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[California Energy Commission Letterhead]

Notice of Staff Workshop on Natural Gas Storage Research

The California Energy Commission's (Energy Commission) staff and the staff of the University of California's California Institute for Energy and Environment (CIEE) will conduct a joint workshop to explore the preliminary results of research on California natural gas storage strategic issues funded by the Energy Commission's Public Interest Natural Gas Research (PIER NG) Program and managed by CIEE.

9:30 a.m.
1516 Ninth Street
First Floor, Hearing Room A
Sacramento, California
(Wheelchair Accessible)

Note: Audio from this hearing will be broadcast over the Internet.
For details, please go to:

For details on how to participate via WebEx, please see the "Participation through WebEx" section of this notice.


This workshop will include presentations by researchers discussing their research projects, their preliminary findings, and the implications for additional natural gas storage in California. Topics include regulatory and pricing considerations for development of new storage, modeling of natural gas infrastructure in California, northern and southern California and in-state versus out-of-state storage options, projections for storage needs in California, new technology options and other strategic issues of concern to California storage operators, regulators and consumers. There will be panel discussions of various California natural gas storage topics with opportunities for audience participation. Each panel will be made up of researchers who have been awarded PIER NG Program grants on the topics to be discussed.


Storage plays an extremely important role in the natural gas market. Storage can serve as an economic substitute for either gas production deliverability or as a substitute for long-line natural gas pipeline capacity. It also serves a critical role in the natural gas market place in terms of its influence on natural gas prices and providing security of supply.

Notwithstanding, storage is only an intermediate product. Storage capacity, like pipeline capacity, provides value only to the extent that it increases the value of the natural gas injected into storage, or increases the reliability of natural gas flowing through natural gas pipelines connected to the storage. Historically, pipelines and local distribution companies used storage to fulfill their obligations for a reliable supply of gas by balancing supply and demand on a seasonal, weekly and daily basis. However, the role of storage and the analysis of storage economics and social benefits have been changed by commodity deregulation and the tremendous growth in the use of natural gas for power generation in California and throughout North America.

The deregulation of natural gas prices significantly changed the value and use of storage because under the new regime there is an opportunity, indeed a commercial necessity, to profitably manage the purchase and sale of the commodity. Commodity price deregulation introduced variability and, therefore, uncertainty into gas commodity pricing. While storage maintains an important role in providing reliability of gas supply, storage also has come to play an increasingly important role for producers, customers and intermediaries managing price levels and price volatility.

The programs Strategic Research area is charged with supporting public interest research on California's natural gas storage infrastructure, regulation and markets. To accomplish this, at the request of the Energy Commission, CIEE issued a Research Opportunity Notice (RON) entitled "Market and Regulatory Options Research for California Natural Gas Storage" (CIEE-NG-2006-01) on March 8, 2006, which resulted in five natural gas storage research projects being approved by the Energy Commission at its November 29, 2006, Business Meeting.

Those projects are listed in the following table and will have their preliminary results presented and discussed at this research forum.

1. Energy & Environmental Analysis (EEA) Developing a multi-state natural gas infrastructure simulation model to analyze the value of natural gas storage in California.
2. UC Davis Developing a low cost, daily simulation model of the California natural gas transportation and storage network to serve as a tool informing policy, infrastructure and daily operational decisions.
3. Black & Veatch (B&V) Expansion of proprietary models to conduct research on California natural gas infrastructure and develop a portfolio of responses to California natural gas market demand scenarios.
4. Gas Technology Institute Developing a California natural gas storage technology research assessment.
5. MRW Developing a research assessment of regulatory barriers to the expansion of natural gas storage facilities in California.

Participation through WebEx

To participate in the meeting using the WebEx onscreen and audio functions, please go to the following URL in your web browser on the date and time of the meeting: https://energy.webex.com/energy/j.php?ED=95803727&UID=1006328472 If the link above does not work, go to: https://energy.webex.com/ and enter the meeting number: 927 533 007 When prompted, enter your information and the following meeting password: 15storage$ Provide your phone number, when prompted, to receive a call back on your phone for the audio of the workshop. Alternatively, you can call 1-866-469-3239 (toll free in the U.S. and Canada). If you have difficulty joining the meeting, please call the WebEx Technical Support number at 1-866-229-3239.

Participation through audio only

If you do not have computer access and wish to participate in the meeting by phone, you can call 1-866-469-3239 (toll free in the U.S. and Canada).

Please be aware that the workshop's WebEx audio and onscreen activity will be recorded.

Contact Information

The Energy Commission's Public Adviser's Office provides the public assistance in participating in Energy Commission activities. If you want information on how to participate in this forum, please contact the Public Adviser's Office at (916) 654-4489 or toll free at (800) 822-6228, by FAX at (916) 654-4493, or by e-mail at [pao@energy.state.ca.us]. If you have a disability and require assistance to participate, please contact Lou Quiroz at (916) 654-5146 at least five days in advance.

Please direct all news media inquiries to Claudia Chandler, Assistant Executive Director, at (916) 654-4989, or by e-mail at [mediaoffice@energy.state.ca.us]. For technical questions on the subject matter, please call Michael Magaletti at 916 654-4599 or e-mail him at [mmagalet@energy.state.ca.us].

Note: California Energy Commission's formal name is State Energy Resources Conservation and Development Commission.

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