MONDAY AGGREGATE: CPUC Hands Gas Customers a Price Argument in Aliso Canyon Proceeding
Good morning.
The CPUC has placed gas-price impacts at the center of the A.26-01-009 Aliso Canyon proceeding while foreclosing SoCalGas’ preferred outcome.
- Commissioner Karen Douglas ruled that any increase above the facility’s current 68.6 Bcf inventory limit is out of scope, but she also noted that reducing storage capacity would likely cause forward prices to rise.
- Parties challenging a 10 Bcf reduction now have a commissioner-supplied premise on price impacts as the proceeding also considers revisions to the framework governing future Aliso Canyon assessments.
Meanwhile, a new proposed decision would allow PG&E to withdraw its $93.5 million Hinkley compressor CPCN application while carrying a detailed evidentiary checklist into its next cost-recovery case, including whether the station needs its current compression capacity under the 1-in-10 peak-day standard.
Commissioner Darcie Houck also opened the comment period for a proposal requiring utilities to document how community engagement shapes climate-adaptation findings/spending.
ALISO CANYON
A new scoping memo from CPUC Commissioner Karen Douglas establishes two questions for the SoCalGas application A.26-01-009:
- Whether the Aliso Canyon gas storage facility's maximum inventory should remain at 68.6 Bcf or be reduced; and
- Whether the CPUC should revise Attachment A, the modeling framework governing future biennial assessments of the storage facility.
Attachment A directs Energy Division to evaluate demand, hydraulic reliability, seasonal gas-system reliability and economic conditions when recommending whether Aliso Canyon’s inventory limit should change.
Commissioner Douglas's ruling says SoCalGas’ request for an inventory increase is out of scope, and explains that a higher inventory could require a higher maximum operating pressure that CalGEM has not been asked to evaluate.
Intervenor testimony is due August 20, prepared rebuttal testimony is due September 17, and intervenor rebuttal testimony is due October 8.
INSTANT ANALYSIS: SoCalGas lost its best-case outcome before serving a page of testimony: an increase in Aliso Canyon’s maximum inventory is now out of scope. But the Commission also put Attachment A itself in play, meaning this docket will determine not only whether the storage limit drops by 10 Bcf, but how future reduction decisions are modeled.
The memo separates two vulnerabilities in staff’s case. The Biennial Assessment acknowledges that its economic analysis does not predict how a lower inventory limit would affect gas prices.
Douglas then goes further in a footnote (Footnote 6), noting that the forward prices used in the analysis reflect the current storage limit and that reducing capacity “would likely cause the forward prices to rise.” That does not decide the case for SoCalGas, but it gives the utility a commissioner-supplied premise for challenging the rate impacts of staff’s recommendation.
More recent coverage of A.26-01-009 is available at the following links.
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NATURAL GAS INFRASTRUCTURE
A new proposed decision, if adopted, would let PG&E withdraw its CPCN application for the $93.5 million Hinkley Compressor Station Electrical Upgrades Project after the utility began construction January 20 under General Order 177's emergency exemption.
PG&E told the CPUC that equipment failures and worsening obsolescence risked an unrepairable outage at the San Bernardino County station (a backbone compression point moving interstate gas toward Central and Northern California) before the CPUC could rule. The project replaces aging switchgear, motor control centers, load centers, conduit and cables.
The PD finds that PG&E followed GO 177’s procedural steps, but it does not determine whether an emergency actually existed. Every substantive dispute moves to future cost recovery. PG&E will have to justify the project’s full scope and defend Hinkley’s existing compression capacity against possible downsizing. PG&E must also separate emergency costs from the broader upgrade and itemize capital and expense costs by equipment, category, year and MAT code.
The PD also asks why PG&E waited until January 2026 to install portable generators it says could avert the emergency, despite 2023 General Rate Case funding for Hinkley work. TURN and Cal Advocates did not oppose withdrawal but questioned the cost, the prior funding and possible mismanagement.
The earliest the CPUC will consider this item is August 13.
INSTANT ANALYSIS: The PD converts every intervenor concern into a mandatory showing in PG&E's next cost-recovery case detailing:
- Whether the full upgrade was necessary;
- Whether Hinkley needs its current compression at all under the 1-in-10 peak day standard;
- Which costs were genuinely emergency-related; and
- Why work started only in January 2026 when ratepayers had already funded Hinkley work in the 2023 GRC.
Additionally, the PD leaves the Commission's Safety and Enforcement Division free to investigate Cal Advocates' mismanagement allegations, which this proceeding never reached.
The proceeding closes, but nothing is settled. The next General Rate Case will inherit a retrospective reasonableness review with an evidentiary checklist already written.
CLIMATE CHANGE ADAPTATION
Commissioner Darcie Houck has entered two items into the record of the CPUC's Climate Change Adaptation rulemaking and opened them for comment.
The first is an Energy Division proposal to replace the utilities' point-in-time Community Engagement Plans with a four-year Community Engagement Framework tied to each Climate Adaptation Vulnerability Assessment (CAVA). The framework requires three public touch points per cycle:
- A scoping kickoff at the end of year one;
- A pre-prioritization check-in in year three; and
- The existing workshop 90 days before the CAVA is filed, held across each utility's organizing regions.
The framework also requires a publicly transparent advisory-group process, a separate Tribal engagement track, posted recordings and materials, and a documented feedback loop showing how community input changed the CAVA or why it was not incorporated. The framework would start in 2027, filed by Tier 2 advice letter, with each CAVA and General Rate Case required to show how engagement and adaptive-capacity findings shaped proposed investments. An evaluation report would follow each CAVA by Tier 1 advice letter.
Energy Division also proposes eight criteria for community adaptive-capacity methods, grouped under public interest, transparency, and data resolution. The criteria include analyses that are:
- Understandable to communities and investment decision-makers;
- Ground-truthed against local experience;
- Built on auditable and stable data;
- Comparable across time and geography; and
- Able to detect small pockets of vulnerability that averages obscure.
Staff's key finding is that first-round engagement and technical analysis ran as parallel tracks, with no visible link from community input to vulnerability findings or rate-case spending. The criteria would apply starting with the 2028 Sempra CAVAs, with PG&E's 2027 filing addressing them where possible. The proposal also directs utilities to coordinate with local governments, state agencies, and other CPUC proceedings to reduce duplicative outreach.
The second attachment is the utilities' Climate Lexicon Working Group Report, filed last August. PG&E, SCE, SDG&E, and SoCalGas built definitions from CPUC, IPCC, and UN sources, then revised them after a public workshop and written comments.
The list covers exposure, acute and chronic hazards, sensitivity, vulnerability, adaptive capacity, disadvantaged vulnerable communities, resilience, risk, risk mitigation, and investment prioritization. The utilities reached consensus on all definitions and incorporated most party suggestions, declining changes where:
- A term was already fixed by CPUC decision;
- Involved cost-recovery policy outside the group's scope; or
- Concerned mitigation rather than adaptation.
Commissioner Houck's ruling asks whether the CPUC should adopt the definitions in whole or in part, and whether to create an update mechanism such as a staff resolution or Tier 3 advice letter process.
Opening comments on both attachments are due July 30; replies are due August 10.
INSTANT ANALYSIS: The Energy Division proposal converts climate-adaptation outreach from a compliance exercise into a traceable input to utility spending. Both sides gain something from that record. Parties get a basis for challenging climate-resilience spending with no visible community connection, and utilities get a documented chain from engagement to investment when defending proposals.
The proposal does not resolve the question of how much weight community input must carry. Utilities face three public touch points yet retain full discretion to reject feedback so long as they explain why.
The lexicon may prove consequential over time. Common definitions for exposure, vulnerability, adaptive capacity, resilience, and risk would set the terms on which utilities frame future CAVAs and parties contest them.