California agency touts coordinated LNG permitting

In adopting its mandatory 2003 biennial report to the governor and Legislature, the California Energy Commission recommended the state establish a coordinated permitting process for liquefied natural gas receiving facilities proposed to serve the West Coast.

Alaska, which is sitting on trillions of cubic feet of gas with no way to get it to market, sees the proposed LNG receiving terminals in Southern California as a prime marketing opportunity.

The California report, however, also acknowledges the state needs to reduce its dependence on natural gas as a fuel for power plants in order to lessen the risk of volatile electricity prices when gas markets shoot up. To achieve that goal, California will need to reduce its overall electricity demand, and increase the use of renewable energy, the report said.

Natural gas powers more than one-third of California’s electrical generation, with the amount expected to grow to 45 percent in 10 years, the report said. The commission adopted the report Nov. 12.

Major recommendations of the report include:

• More stringent energy efficiency targets for 2008, and the state implement real-time pricing of electricity to reduce peak load demands by 5 percent.

• Encourage more cogeneration and distributed generation in state, and examine the implications of retiring or replacing aging, inefficient power plants.

• Establishing the goal of reducing petroleum consumption used for transportation by 15 percent by 2020.