Keeping California’s Clean Energy Promise Loretta Lynch Member, Board of Directors Pacific Environment

What is Liquefied Natural Gas? Natural gas is extracted through underground drilling overseas. Natural gas is extracted through underground drilling overseas. Chilled to -260 degrees Fahrenheit—liquefies, becomes highly flammable. Chilled to -260 degrees Fahrenheit—liquefies, becomes highly flammable. Moved in huge, diesel-burning tankers across the ocean. Moved in huge, diesel-burning tankers across the ocean. Re-gasified at coastal import terminals. Re-gasified at coastal import terminals. Sent into CA’s gas pipelines which must be retrofitted to handle foreign gas. Sent into CA’s gas pipelines which must be retrofitted to handle foreign gas.

Who Are the LNG Companies?

LNG: Further Dependence on Foreign Energy

Fact: Plentiful Supplies Industry Hype of Gas Shortages False. There are 1,400 Trillion Cubic Feet of Gas Reserves in the Lower 48 United States. The U.S. Uses About 60 Billion Cubic Feet of Gas per year. That’s a 60 year supply. There are 488 – 516 TCF of gas reserves in Canada. Canada now uses about 8 billion Cubic Feet of Gas per Year, projected to rise to 12 billion by 2025 – 190 BCF Total. At that rate of growth, Canada has about enough gas to supply itself for 90 years, not counting exports.

The Fictional Shortage of ‘05 December ’05 – ’06: Gas prices hit $16 per unit. December ’05 – ’06: Gas prices hit $16 per unit. Utilities blamed hurricanes, tight supplies, ‘spiraling demand.’ Utilities blamed hurricanes, tight supplies, ‘spiraling demand.’ March ’06 Mid-Western Attorneys General Report: Prices driven by complex, deregulated market, NOT shortages. March ’06 Mid-Western Attorneys General Report: Prices driven by complex, deregulated market, NOT shortages. Spring ’06: Gas storage is at record highs, price tumbles to about $6. Spring ’06: Gas storage is at record highs, price tumbles to about $6. June ’06: Washington Post Reports “Gas Glut.” June ’06: Washington Post Reports “Gas Glut.”

California Gas Demand Source: Dave Maul, California Energy Commission In California, we are using 20 percent less than we were in Demand is Expected to Stay Flat Until

How To Reduce Gas Demand Source: Community Environmental Center Renewables and Efficiency has the potential to meet more than 3 times the projected increase in demand, with cleaner and safer energy.

Old, Gas Guzzling Power Plants About 2/3rds of Gas Fired Electricity Comes from Power Plants Over 25 Years old. Most of these are sited in poor neighborhoods. Everyday, these plants unnecessarily hemorrhage huge amounts of gas. Replacing them would save about 50,000 GWh, or about 85 percent of energy from one LNG terminal Hunter’s Point Power Plant, Decommissioned in

Other Efficiency Opportunities Source: Community Environmental Council.

The Role of Renewables Source: Community Environmental Council

Wind More Economical Than Natural Gas Wind power now costs 5 cents per kilowatt hour. NG prices peaked at 8 to 9 cents in winter. Wind power now costs 5 cents per kilowatt hour. NG prices peaked at 8 to 9 cents in winter. Wind industry creates 7 times more jobs than natural gas industry. Wind industry creates 7 times more jobs than natural gas industry. Wind provides long term income to landowners who host the turbines. Wind provides long term income to landowners who host the turbines.

LNG = Higher Utility Bills California LNG investment dependent on locked-in, long term contracts with utilities. Non-competitive environment. Cost of infrastructure passed on to consumers through charge on bill. Cost of foreign extraction passed on to taxpayers through Export Credit Agencies. Cost of increased security around facilities passed on to taxpayers. LNG More Expensive to Produce and Transport than domestic gas. Global Competition from China, India, Europe will drive up cost. Increasing talk by gas producing countries of natural gas cartel.