California Regulators Signal Ratepayer Protection in Initial Rejection to SoCalGas

San Francisco, CA - In an initial proposed decision last week, the California Public Utilities Commission (CPUC) recommended denying a SoCalGas application that would charge customers $266 million to study and plan the controversial Angeles Link Project pipeline. A final vote on the decision is expected in the coming months and if approved, it would force SoCalGas to either drop the project entirely or require shareholders to pay to develop the risky project.

The Angeles Link would transport hydrogen fuel, a volatile and expensive energy source, from Southern California into the Los Angeles Basin. Sierra Club and others have criticized the project for its enormous Phase 2 planning and study costs, which ballooned from $92 million to $266 million between SoCalGas's applications. Additionally, green hydrogen requires huge quantities of dedicated renewable energy that could better be used to directly replace fossil fuels end uses. Sierra Club also challenged SoCalGas' plan to charge gas customers for this project even though they would not directly benefit from it.

The CPUC's proposed decision says SoCalGas failed to identify specific benefits to its ratepayers and that it would be premature to approve costs while the project is still in the planning phase. Los Angeles Department of Water and Power's plans to rely on Angeles Link to supply the Scattergood hydrogen conversion is no less imprudent, given the project's soaring costs and the significant uncertainties that the Commission here found unacceptable.

In response, Sierra Club's Senior Campaign Organizer Julia Dowell released the following statement:

"Affordability is rightly at the forefront of every energy conversation, and that's increasingly making hydrogen look like a risky and unnecessary technology to use at large scale. The CPUC was correct in its initial assessment that SoCalGas would require gas customers to pay for a project they wouldn't benefit from. We're hopeful that the commission will finalize this decision and push the cost of any hydrogen infrastructure on to wealthy shareholders, not working class customers who are struggling with rising energy bills."