Southern California Gas Company's Reply Comments on Electric Reliable and Clean Power Procurement Program Staff Proposal

Strategic Insights -

The Public Utilities Commission of California has issued a regulatory update, instituting rulemaking to continue electric integrated resource planning and related procurement processes. Southern California Gas Company (SoCalGas) has submitted their reply comments on the Electric Reliable and Clean Power Procurement Program Staff Proposal. The company emphasizes the importance of incentivizing long lead time resource procurement planning, supporting the inclusion of re-powers of gas generation, and promoting clean firm resource procurement.

Key Takeaways:

  • SoCalGas supports incentivizing long lead time resource procurement planning, recommending extended compliance years to encourage load serving entity (LSE) procurement of long lead time and clean firm resources.
  • The company agrees with the Green Hydrogen Coalition's recommendation to extend RCPPP procurement timelines to incentivize and include long lead-time resources like renewable hydrogen.
  • SoCalGas disagrees with the proposal to exclude re-powers of gas generation, arguing that it would result in the retention of less efficient gas generation and instead recommends incentivizing re-powers that can focus on reducing carbon intensity with improved technology and/or cleaner fuels.
  • The company advocates for promoting clean firm resource procurement, agreeing with CEJA/Sierra Club/CEERT that 2024 natural gas generation supplied 40% of California's total electric generation and will continue to provide power when renewables and batteries are unavailable.
  • SoCalGas supports the inclusion of a wide range of resources, including large hydro, nuclear, renewable hydrogen, renewable natural gas, and natural gas-fired generation with carbon capture as zero-carbon resources.
  • The company recommends allowing for partial ZECs (Zero Emission Certificates) for carbon capture technologies, as suggested by SDG&E and Bloom Energy.
  • SoCalGas disagrees with the proposal to restrict hydrogen eligibility only to electrolytic hydrogen created from surplus renewable energy, arguing that it could curtail the critical development of hydrogen and prevent it from being available when California needs it in the future.
  • The company suggests considering a mass-based approach for GHG emission reduction targets, setting targets/limits for each individual LSE based on the electric sector's contribution to overall state GHG goals.
  • SoCalGas recommends using a similar emissions accounting methodology as the IRP's hourly Clean System Power (CSP) tool for compliance under a mass-based approach.

Statistics:

  • 40% of California's total electric generation came from natural gas in 2024
  • 1.6 MMT (megatons) of hydrogen use is projected in the power sector by 2045, according to California Energy Commission modeling
  • Southern California Gas Company's opening comments recommend extending compliance years to incentivize load serving entity (LSE) procurement of long lead time and clean firm resources

Sources:

  • California Public Utilities Commission, Order Instituting Rulemaking to Continue Electric Integrated Resource Planning and Related Procurement Processes, Rulemaking 20-05-003 (Filed on May 7, 2020)
  • Southern California Gas Company, SOUTHERN CALIFORNIA GAS COMPANY'S (U 904 G) REPLY COMMENTS ON ADMINISTRATIVE LAW JUDGE RULING SEEKING COMMENTS ON THE ELECTRIC RELIABLE AND CLEAN POWER PROCUREMENT PROGRAM STAFF PROPOSAL
  • CAISO, California Independent System Operator, Opening Comments
  • Green Hydrogen Coalition, Opening Comments
  • CEJA/Sierra Club/CEERT, Opening Comments
  • California Environmental Justice Alliance, Opening Comments
  • Center for Energy Efficiency and Renewable Technologies, Opening Comments
  • California Energy Commission, In-State Electric Generation by Fuel Type (GWh) Table, available at: https://www.energy.ca.gov/data-reports/energy-almanac/california-electricity-data/electric-generationcapacity-and-energy.