Dive Brief:

California gas utilities let 6.6 billion cubic feet escape in 2015 — more than was lost in the Aliso Canyon leak discovered in 2015, according to the Environmental Defense Fund.

more than was lost in the Aliso Canyon leak discovered in 2015, according to the Environmental Defense Fund. EDF said that based on wholesale gas prices, the leaks could be costing California customers $18 million annually in addition to posing a significant environmental threat.

The data, collected under a law passed in 2014 that directed utilities to reduce methane emissions, concludes 80% of leaks occur in four areas: customer meter sets; metering and regulating stations; ungraded leaks; and intentional venting.

Dive Insight:

The Aliso Canyon leak had a serious impact on California's energy markets, with the U.S. Energy Information Administration estimating gas generation was off about 20% during summer 2016. But according to EFD's analysis of California methane emission data, the state's gas utilities are already losing more than that each year.

"These huge gas losses are a major environmental problem," writes EDF's Amanda Johnson. "Based on an average wholesale market price of gas, these losses mean ratepayers are paying approximately $18 million every year for gas that is never delivered."

The Aliso Canyon leak was estimated to have released 109,000 metric tons of methane. The state was able to replace lost power largely by carbon-free sources and power imports, and rushed out battery storage projects to avoid energy shortages.

As California continues to address methane leaks, Johnson predicts reported figures are likely to initially rise before declining. "That’s because leak detection and quantification technology required under SB 1371 is better equipped at finding leaks – meaning utilities will start accounting for more leaks with each survey," she writes.

Of the state's two largest gas utilities, EDF said Pacific Gas and Electric has moved ahead with efforts to reduce methane leaks. But "in contrast, SoCalGas – the nation’s largest gas utility, and the company responsible for the Aliso Canyon gas leak – appears to be dragging its feet," Johnson said.

The utility disputed that to Natural Gas Intelligence last week, saying Southern California gas is pursuing "many new technologies that allow the company to detect and repair non-hazardous leaks more quickly than ever."