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CC - Item 1B - Prevent Increased Air Pollution• uvu r ~ecl e, f nq Southern California Must Preserve its Supply of Clean Natural Gas to Prevent Increased Air Pollution FACT SHEET For decades, Southern California has relied on clean natural gas to minimize air pollution from its homes, businesses and industries. The current supply meets AQMD's requirements. Due to a projected growth in natural gas demand and to replace existing gas supply, gas providers plan to import huge quantities of liquefied natural gas (LNG) from overseas. Shipped by tanker vessels to import terminals. along the West Coast of the United States and Baja Mexico, the fuel is re-gasified at the terminals and then piped to consumers in Southern California. Sempra Energy's Energia Costa Azul LNG import terminal in Baja, in conjunction with Sempra's subsidiary Southern California Gas Co., will begin such imports as early as next year. • LNG from overseas is known to contain impurities that cause it to burn hotter and dirtier, resulting in increased air pollution. • Southern California Gas Co. estimates that 1 billion cubic feet of imported gas will result in an additional 1.2 tons per day of smog-forming nitrogen oxide emissions - equivalent to that from 120,000 cars. The AQMD believes the actual air pollution impact will be much higher. • Increased air pollution will add to the already serious health burden in Southern California, the most polluted region in the country. Increased health effects mean higher health costs for residents. • The use of dirty natural gas imported from overseas may cause some business to violate air pollution permit conditions, raising their compliance costs. • Imported natural gas can be treated to prevent excess emissions, adding less than 1 percent to the cost of the gas. To preserve the region's supply of clean natural gas, AQMD has: Proposed a measure in its 2007 Air Quality Management Plan that would require imported natural gas to be as clean as natural gas currently supplied to the region; and Filed a lawsuit seeking to compel the California Public Utilities Commission to study the environmental impacts of using dirty imported gas and to mitigate air pollution impacts from its use.