California repeatedly warned about spiking gas prices, fragile supply. But fixes never came
California’s biggest energy companies are refusing to build new pipelines as the high-prices of natural gas and heating oil threaten to send an unprecedented flow of gas out of the state.
The company chiefs, many of whom are political appointees, have cited the state’s weak regulatory structure, the cost of completing projects, and the threat of lawsuits from environmentalists in explaining their inaction.
As California’s energy crisis deepens, it’s an ironic twist that the state’s biggest energy companies have been fighting the very regulatory fix required to solve the problem.
But the companies’ unwillingness to build new pipelines is exactly what’s needed to lower prices. After the price spike of 2010, the state’s energy companies — eager to take their sweet profits home — poured tens of millions of dollars into lobbying to block any effort to create a statewide system of natural gas pipelines.
The pipeline problem is a sign that regulators have failed to solve a decades-long energy crisis: The state relies heavily on gasoline and diesel, with no significant amounts of natural gas pipelines crisscrossing the state, not to mention the state’s vast network of power plants.
“There is no pipeline system going in, there is no pipeline system going out,” said Bill Lockwood, chief executive of Southern California Gas Co. in Gardena. The companies and their lobbyists argue that the state’s rules don’t allow it to build pipelines.
“To be blunt, it’s not a pipeline system because it’s not in the state,” he said.
No wonder California’s regulators spent so much time on the problem: The state’s lack of pipeline capacity is a major reason it’s unable to meet its targets.
