(Reuters) – California’s utilities regulator on Thursday laid out a clear path toward the possible closure of SoCalGas’ Aliso Canyon gas storage facility, prioritizing energy reliability and affordability as the state transitions to cleaner energy.
The California Public Utilities Commission (CPUC) has set a peak natural gas demand target of 4,121 million cubic feet per day, marking the threshold at which Southern California can meet demand without Aliso Canyon, it said in a statement.
Aliso Canyon, which serves more than 11 million customers and supplies fuel to 17 natural gas-fired power plants, will be assessed for permanent closure when “predicted peak day demand declines to target levels two years from now,” the CPUC said.
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Demand for natural gas in Southern California is currently on a downward trajectory due to state policies and climate goals, the regulator said.
The CPUC added that this includes purchasing historic amounts of renewable electricity, reducing dependence on natural gas-fired power plants.
“Aliso Canyon must be closed for good, but without hurting working families with skyrocketing energy bills,” Gov. Gavin Newsom said in a statement.
U.S. natural gas futures rose about 6% to a 23-month high on Thursday on lower production in recent days, an increase in the amount of gas flowing to liquefied natural gas (LNG) export plants to a 11-year high months, and early forecasts for colder weather in January. [NGA/]
(Reporting by Daksh Grover in Bengaluru; Editing by Abinaya Vijayaraghavan)
