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    News

    LB State Senator Karnette Backs CA Public Utilities Comm'n In Fight w/ FERC Over Who Should Decide LB LNG Facility


    (June 10, 2004) -- State Senator Betty Karnette (D, Long Beach) has announced that she supports the position of the CA Public Utilities Commission (CPUC) that the Mitsubishi subsidiary (Sound Energy Solutions), now seeking permission from the Federal Energy Regulatory Commission (FERC) to build and operate a Liquefield Natural Gas (LNG) facility in the Port of Long Beach, should be required to seek and obtain permission under CA law from the CPUC.

    In an emailed letter received today by LBReport.com (and posted verbatim below), Sen. Karnette states that she supports "the CPUC's position regarding jurisdictional issues" related to construction of the proposed LNG facility at the Port of LB and adds, "I strongly agree with the CPUCís assessment that SES is required, by law, to apply with the CPUC for a Certificate of Public Convenience and Necessity (CPCN) and that FERC has no basis for preempting the Stateís environmental requirements with regard to the proposed LNG facility.

    As previously reported by LBReport.com, in March FERC ruled that SES does not need CPUC's permission...and FERC declared itself the body with exclusive jurisdiction over safety and siting issues.

    CPUC, and others including LB Citizens for Utility Reform (headed by LB activist Bry Myown) responded by requesting that FERC grant a re-hearing to reexamine its position.

    Additionally in April, CPUC escalated its confrontation with FERC by voting unanimously to institute its own regulatory proceedings (regardless of FERC's position). In a CPUC proceeding, SES would have to demonstrate to CPUC's satisfaction that its proposed facility would be safe and serve the public interest and necessity.

    Sen. Karnette's letter comes as FERC has scheduled a June 17 agenda item on rehearing requests filed by CPUC and LB Citizens for Utility Reform, the latter submitted by Ms. Myown, a critic of the SES proposal. Ms Myown has indicated she believes FERC is making LB a test case nationally that could result in state and local agencies losing control over safety and siting issues surrounding proposed LNG plants across the country.

    In comments to LBReport.com in May, Assemblyman Alan Lowenthal (D., LB-SP-PV) also declared he supports CPUC's position on the jurisdictional issue.

    [begin Sen. Karnette emailed text received today; text indicates a June 4 date on the original letter]

    As the Federal Energy Regulatory Commission (FERC) deliberates on jurisdictional issues related to the proposed Liquefied Natural Gas (LNG) facility in Long Beach, I am hopeful that the re-hearing will focus on the California Public Utilities Commissionís (CPUC) statutory responsibility to oversee this project and to ensure that the best decision is made for the state and local community.

    I support the CPUCís position regarding jurisdictional issues related to the Sound Energy Solutions (SES) proposal to construct a LNG facility at the Port of Long Beach.

    I strongly agree with the CPUCís assessment that SES is required, by law, to apply with the CPUC for a Certificate of Public Convenience and Necessity (CPCN) and that FERC has no basis for preempting the Stateís environmental requirements with regard to the proposed LNG facility.

    SESís proposal to sell LNG in California's natural gas market clearly qualifies them as a public utility under Californiaís Public Utilities Code. As a result, the CPUC should have the statutory duty over safety and siting of natural gas facilities in California.

    Preserving our environment and improving safety and security at and around our ports is paramount. The State of California, and local stakeholders in particular, must play the key role in any final decision that is made.

    Sincerely,

    [ORIGINAL SIGNED]

    BETTY KARNETTE
    State Senator, 27th District

    Responding to the developments, Ms. Myown told LBReport.com, "I deeply appreciate the Senator's and Assemblyman's statements and I strongly urge them to file their own comments with FERC, and obtain and file a resolution from from their legislative colleagues before June 17. I also hope they will encourage their their Congressional colleagues to do likewise."


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