The Truth about LNG: Unspinning the LA Weekly Coverage

Wayne Lusvardi at ChronWatch sorts the truth from the mistruths in LA Week's recent article on liquefied natural gas:

Spin - Kelly quotes U.S. Rep. John Dingell (D-Mich) that “if you love Enron, you’ll love” the newly passed energy policy legislation passed last month which allows the Federal government to override some California obstructions for siting of LNG terminals off the coast of California. Unspin – Since LNG terminals will compete against Enron’s Transwestern Pipeline, how could it be that Enron would welcome competition from LNG terminals? The infamous name “Enron” is linked with “LNG” in the article only to demonize LNG in the mind of the reader.
Spin - LNG will stymie such technology as wind and solar. Unspin – Redundant conventional power plants are necessary to solar and wind energy farms because of the unpredictability of the weather. It would take 300 square miles of a wind farm to generate the same 1,000 megawatts as a conventional gas-fired power plant which takes up only about one-half square mile. Imagine one mile squares of wind farms lined up in a row extending from Los Angeles to San Francisco.
Spin – State energy regulators fear that LNG providers will gain an excessively large share of the energy market and exercise undue “market power” resulting in another 2001-style energy crisis unless regulators can impose “anti-hoarding” price regulations on them. Unspin – During the energy crisis of 2001, gas prices spiked not so much because of price gouging but because of the lack of cheap hydropower from the Pacific Northwest and the lack of additional capacity in inter-state gas pipelines. Anyone with a rudimentary background in economics should be able to realize that the more the supply of natural gas and the greater number of providers, such as LNG, the greater the likelihood of lower gas prices.
Spin – A report issued by the Energy Ventures Group is concerned that: (a) LNG importers will become “pivotal suppliers” similar to the power generators that caused the state’s energy crisis; and (b) that LNG will add to the U.S. trade deficit. Unspin – Merchant energy companies did not “cause” the California electricity crisis of 2001; while the Los Angeles DWP and its contractor Reliant Energy were involved in a price ratcheting and arbitraging scheme of much greater proportions than Enron’s puny 4% share of the California energy market. The crisis was caused by energy regulators who erected barriers from buying cheap electricity from out of state during the crisis and slapped on price controls and a “competitive transition” surcharge. The Energy Ventures Group concern about a trade deficit and price gouging is contradicted by a December 18, 2002 news release on their website “The Coming Natural Gas Crisis” which curiously predicts that there will be a shortage of natural gas for the next 5 to 7 years.
Spin - The LA Weekly article states that Sempra Energy has already begun building an LNG terminal in Mexico this year and that the PUC wants to “protect Californian’s safety and pocketbooks.” Unspin – What writer Kelly omits is that if Sound Energy and BHP Billiton are not allowed to build competitive terminals in California, then Sempra will have a monopoly since it already curiously has been given the go-ahead to build a terminal. Why isn’t Kelly equally worried about price gouging by Sempra?
Spin – LNG has been endorsed by the Mojave Desert Air Quality Management District and Omnitrans (San Bernardino) as well as businesses and other public agencies. Unspin – No mention is made that Honda is coming out with a natural gas fueled car and that it is not only public transit agencies that would benefit from LNG, but consumers.

Sounds familiar...