AB 324

Pipe Dream

May 2023

Californians are understandably irate over skyrocketing natural gas bills that have left many homeowners unable to pay their utility bills. Consumer groups are calling for investigations into SoCalGas and their unregulated parent company, Sempra Energy, that profited handsomely all at ratepayer expense. The CPUC just opened an investigation as to why natural gas costs are 3-4 times higher in California than most other parts of the United States. Adding insult to injury, SoCalGas is seeking a massive 46% rate increase that will cost ratepayers more than $4.9 billion over the next few years, and nearly $2 billion per year, every year thereafter.

But even that is not enough. SoCalGas and Sempra Energy have proposed a measure in the California Legislature that will drive natural gas costs and consumer utility bills even higher.

AB 324 (Pacheco) would require procurement of highly expensive and highly volatile hydrogen for injection into the state’s existing natural gas pipelines.

SoCalGas claims to be on a mission to build the “cleanest, safest and most innovative energy company in America” … not exactly. The same company that brought us the Aliso Canyon disaster is now trying to legislate a high cost scheme that will enrich their shareholders and leave ratepayers holding the bag.

Last year legislators defeated SB 733, a last-minute “gut and amend”, that sought to tip the scales in SoCalGas’ favor… allowing big gas to invest billions of ratepayer dollars in hydrogen pipelines and infrastructure. While hydrogen is clearly part of California’s clean energy future, regulatory agencies have just begun to explore its role and safety in our natural gas system. SB 733 was an end run around the important due diligence currently being conducted by the California Public Utilities Commission and California Energy Commission.

But they are back again this year, bigger and bolder, with AB 324 that will ensure billions of dollars in shareholder profits all at the expense of their ratepayers. This bill will lead to even higher energy costs for consumers. Natural gas rates are skyrocketing in California and AB 324 (Pacheco) will ensure they will go far higher, further harming the economy and hurting small businesses, farms, and residential customers who can least afford it.