trending Market Intelligence /marketintelligence/en/news-insights/trending/vievavdk7fbfiutvdtgl1q2 content esgSubNav
Log in to other products

Login to Market Intelligence Platform

 /


Looking for more?

Contact Us
In This List

Sempra to California: Natural gas 'not just a bridge fuel'

Q3: U.S. Solar and Wind Power by the Numbers

Path to Carbon-Free Power Generation by 2035

The Growing Importance of Data Centers for European & U.S. Renewable Projects

CAISO and ERCOT Power Forecasts by the Hour


Sempra to California: Natural gas 'not just a bridge fuel'

SNL Image

A view of San Francisco through the Golden Gate Bridge. State lawmakers are considering new restrictions on natural gas
power plants and the need for them in California's economy.
Source: Associated Press

As California presses ahead with its ambitious efforts to green the nation's largest state economy, it must not forget the central role of natural gas-fired generation, utility subsidiaries of Sempra Energy told state regulators and lawmakers, many of whom are looking increasingly for alternatives.

"Today's technology demonstrates that natural gas is a foundational fuel, not just a bridge fuel, for a clean and renewable energy future," Tim Carmichael, state agency relations manager for Sempra's utilities, said in a letter to the California Energy Commission. "Natural gas has enabled renewable growth by providing critical back up generation and storage when the sun doesn't shine and the wind doesn't blow."

Carmichael's comments came on behalf of Southern California Gas Co. in response to the energy policy and planning agency's draft report on California's clean energy future that makes no mention of a role for natural gas generation. Gas remains the state's dominant source of electricity, with a roughly 43% share of in-state generation in 2017, according to state records.

Moreover, a recent report from the California Council on Science and Technology found no near-term alternatives for underground natural gas storage, Carmichael noted. The report, released in January, said, "Without gas storage, California would be unable to accommodate the electricity generation ramping that now occurs nearly every day and that may increase as more renewables are added to the grid."

In his letter, dated June 12, Carmichael asked the energy commission to revise the draft document, the first volume of its forthcoming 2018 Integrated Energy Policy Report, to reflect that California's "clean energy history, current status, and future includes both natural and renewable gas." A commission spokesperson said the utility's comments would be considered ahead of publishing the final report, scheduled for Aug. 1.

Unintended consequences

Meanwhile, state lawmakers have proposed several measures that seek to reduce or even ultimately eliminate natural gas from California's power mix.

An Assembly panel on June 18 advanced legislation that would require more transparency of gas-fired power plants' hourly emissions of nitrogen oxides and other pollutants, place new restrictions on the operations of natural gas-fired plants, and require regulators to complete a study and make recommendations on how to reduce natural gas generation. The Assembly Natural Resources Committee advanced Senate Bill 64 on a 6-3 vote after the Senate passed the measure in May.

SoCalGas and its affiliate San Diego Gas & Electric Co. opposed the measure in a June 15 letter to the committee's chairman, arguing that the proposal "would put a policy in place that could drive up the cost of electricity ... that the state needs to reduce emissions from the transportation sector." The letter calls the bill "duplicative and potentially contradictory" to the work of local air districts.

But proponents of the legislation say that as California adds record volumes of intermittent solar generation, many gas-fired power plants are operating flexibly though they were not designed or permitted to do so. That "could increase air pollution concentrations to unhealthy levels," the Union of Concerned Scientists, a backer of the measure, said in a June 11 letter to the Assembly Natural Resources Committee. "SB 64 would ensure that as renewable energy investments in California increase, this ramp-up in clean generation does not lead to the unintended consequence of increased air pollution."

Another active measure, Assembly Bill 2693, would direct the Public Utilities Commission to specify which natural gas plants can be retired and which are needed to maintain reliability. After passing in the Assembly in May, the bill is in a Senate committee.

S.B. 100, legislation that would accelerate the state's renewable portfolio standard to 60% by 2030 and set a target of 100% zero-carbon power by 2045, also remains active in this second year of California's two-year legislative session. After stumbling in the Assembly in 2017, the measure is scheduled for a hearing July 3 in the Assembly Committee on Utilities and Energy.