Southern California Gas urges customers to cut natural gas use

12/19/2016

(Reuters) -- Southern California Gas Co (SoCalGas) has urged customers to reduce natural gas use to help lower the risk of possible gas and electricity shortages due to what it described as severe cold weather throughout the US Southwest.

The notice, issued Sunday night, came as the utility continues to have only limited access to fuel in its giant Aliso Canyon gas storage facility in Los Angeles following a massive methane leak between October 2015-February 2016.

"We did not pull any gas out of Aliso, but we had to draw significantly on other fields to maintain system reliability," SoCalGas spokesman Chris Gilbride said on Monday.

In addition to residential customers, SoCalGas, a unit of California energy company Sempra Energy, told non-core customers, including refineries and power plants, that they may receive a notice to curtail service.

The independent system operator, which runs the power grid for much of the state, has not yet called on consumers to cut back on electric consumption.

Gas demand spikes in winter due to heating of homes and businesses, while power demand does so in summer when customers crank up air conditioners.

California agencies have said in a report looking at the ongoing outage of Aliso Canyon that SoCalGas could have a tough time meeting a forecast peak demand of 5.2 Bcf/d on the coldest days this winter without the facility.

Gas demand on Monday was expected to reach 4.0 bcf, with 2.9 bcf coming from pipeline imports and the remaining 1.1 Bcf/d from SoCalGas' other three storage facilities.

The state required SoCalGas to keep 15 bcf in the 86-bcf Aliso Canyon to minimize risk of gas shortages that could result in electricity outages.

But that may not be enough to prevent the utility from curtailing supplies to power plants and other industrial facilities this winter.

In past years, SoCalGas has pulled gas from Aliso Canyon on an almost daily basis during the coldest winter months to keep homes and businesses warm and fuel power generators and refineries.

California government agencies looking into SoCalGas' request to start injecting gas into Aliso Canyon said a few weeks ago they would not complete their safety review until early 2017, keeping the field shut at least until later in the winter.

SoCalGas sought permission to re-inject gas into the facility on Nov. 1 to rebuild supplies before the winter.

Reporting by Scott DiSavino; Editing by Paul Simao