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Liquified Natural Gas Terminals Proposed for California:
An Unnecessary and Risky Proposition
Contact:
Tom Politeo, Sierra Club Harbor Vision Task Force
562.618.1127 (cell)
Liquefied Natural Gas: Problems, Not a Panacea
What Is LNG?
Liquefied natural gas (LNG) is natural gas (what many of us use in an odorized form, in our kitchen stoves) in a liquid form. Gas is liquefied by chilling it to minus 259 degrees Fahrenheit (minus 161 degrees Celsius), whereupon it becomes a clear, colorless, odorless liquid. In liquid form, natural gas becomes far more compact-and dangerous. From liquefaction plants overseas, LNG would be shipped to California in huge tankers. At LNG facilities proposed for California (see next section), the gas would be regassified and the natural gas fed into pipelines for distribution to California residences, businesses and other consumers (for more details visit www.energy.ca.gov/lng/,
www.sierraclub.org/ca/coasts/lng.asp,
www.pacificenvironment.org/lng/intro.htm.)
The Sierra Club and other organizations oppose the proposal to build LNG facilities in California and the rest of the U.S, believing that other, sustainable resources should become the basis of our America's energy policy-not increased reliance on imported fossil fuels, which is what LNG represents. In a nutshell, there are several important reasons, listed below in What's Wrong with LNG Plants, for Californians to reject the plans to construct LNG plants in ports and offshore.
What's Proposed
As of early 2005, according to the California Energy Commission there were three active proposals to build LNG terminals in California (for detailed descriptions go to www.energy.ca.gov/lng/projects.html). The proposals are for:
- The Long Beach LNG Facility, to be located in the Port of Long Beach. Proposal was submitted by Sound Energy Solutions (SES), a subsidiary of Japan-based Mitsubishi Corporation. The Port of Long Beach announced in May 2003 its intent to sign a letter of agreement with SES to pursue development of the project.
- The Cabrillo Deepwater Port, to be located offshore from Ventura County. Proposal was submitted by BHP Billiton.
- The Crystal Clearwater Port, also to be located offshore from Ventura County. Proposal was submitted by Crystal Energy LLC.
Opponents of these three projects worry that the Bush Administration's energy bill, before the Senate in late April, 2005, would take permitting and regulatory control away from the California Public Utilities Commission and place it with the Federal Energy Regulatory Commission (see History of the Campaign Against LNG, below).
What's Wrong with LNG Plants
- LNG is dangerous. On January 19, 2004, a large explosion occurred at an LNG plant in Skikda, Algeria. According to the U.S. Department of Energy (www.eia.doe.gov/emeu/cabs/algeria.html) the blast killed at least 27 people and shut operations at several adjacent facilities, including a refinery and oil loading terminals. In LB, the proposed terminal would sit amidst earthquake faults, close to other petroleum and chemical facilities in one of America's busiest harbors. Experts have pointed out that LNG tankers and plants pose an inviting target for terrorists, as well. These factors would make the proposed plant a risk to harbor workers and residents of the city.
For this and other reasons citizens in Eureka (CA), Vallejo (CA), and in Tijuana, Mexico have rejected proposals to site LNG plants in their communities.
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More fossil fuel is not the answer to America's energy needs. Costly LNG plants would increase our dependence on foreign fuel at a time when we should be reducing it. The Sierra Club and its allies believe that the U.S. should be pursuing an alternative energy strategy that moves the country away from dependence on foreign suppliers and toward energy independence. Components of such a strategy include much stronger energy conservation efforts and development of solar, wind, tide and other renewable power sources.
Moreover, although LNG proponents claim that LNG is a solution to an alleged need for California to increase sources of energy, CA utilities have not proven convincingly the need for LNG. An independent study conducted in 2004 by Synapse Energy Economics concluded that California is in a position through 2013 to meet all of its forecasted increases in energy demand with non-gas sources. (lngwatch.com/lngwatch/#notproven).
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Cost to ratepayers --
California utilities and energy companies seek to build into their rate structures the hundreds of millions of dollars it will cost to build LNG plants and infrastructure. The California Public Utility Commission will decide this year whether to authorize this "rate-based" approach for the companies to finance LNG projects. If "rate-basing" is authorized, Californians, through their power bills, could end up paying for energy that the state and utilities haven't even determined we need. (See "Locking Ratepayers into New Monopoly Contracts Will Force Californian Families and Small Businesses to Pay for Bad Business Decisions" at
lngwatch.com/lngwatch/#notproven)
History of the Campaign against LNG
Applications were filed for the three California LNG plants, as follows:
- Port of Long Beach, Filed with FERC and Port of Long Beach on 1/23/04.
- Cabrillo Deepwater, Filed with Coast Guard and CA State Lands Commission 1/27/04.
- Crystal Clearwater, Filed with US Coast Guard on 1/27/04; State Lands Comm. on 2/11/04; refiled with USCG on 7/27/04; USCG identified additional data deficiencies. Draft EIS/EIR published; three hearings held in Southern California.
On March 24, 2004, FERC issued a Declaratory Order Asserting Exclusive Jurisdiction over siting of LNG terminals in the U.S.
In response to FERC's action, Californians for Renewable Energy, Inc., a group opposed to LNG, filed a lawsuit on July 20, 2004, in the U.S. Ninth Circuit Court of Appeals, challenging FERC's claim to regulatory authority over LNG facilities in California. On August 4, 2004, CPUC filed a similar Petition for Review of the FERC Orders. The two suits have now been joined and the case is pending before the Ninth Circuit Court.
As of late April, 2005, an Energy bill, passed by the U.S. House of Representatives and soon to be deliberated by the U.S. Senate, contains provisions that would grant FERC authority by statute over LNG matters. If passed by the Senate and signed into law by the President, the bill would effectively grant regulatory control of LNG in California to FERC, eliminating the basis for the CARE and CPUC lawsuits.
Campaign Partners and Supporters
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