(a) The Legislature finds that there are underground storage facilities for gas that utilize depleted or partially depleted oil or gas reservoirs. Purchased gas, usually from out of state, is injected for storage and withdrawn during peak load periods. The supervisor is required to maintain surveillance over these facilities to ensure that the original reserves are not lost, that drilling of new wells is conducted properly, and that no damage occurs to the environment by reason of injection and withdrawal of gas.

(b) In order to help support the regulatory effort of the supervisor, there shall be imposed an annual charge on operators of underground gas storage facilities to defray the regulatory costs incurred by the state in conducting the activities described in subdivision (a). Each underground gas storage facility operator shall pay a proportionate share of the total regulatory costs projected for each fiscal year based on the field capacity and number of wells for each underground gas storage facility. For each underground gas storage facility, the portion owed by the operator shall be computed by multiplying the operator’s field capacity by the number of the operator’s wells, and dividing that product by the statewide sum across all underground gas storage facilities of the product of the field capacity of each individual underground gas storage facility multiplied by the number of wells at that facility.

(c) In order to defray the costs of the response effort of the division in the event of a large, uncontrolled release of gas from an underground storage facility that poses a significant present or potential hazard to public health and safety, property, or to the environment, there shall be an additional charge imposed entirely on the operator of the underground storage facility at which the uncontrolled leak or release of gas occurred. The charge shall be in the amount of the total directly associated costs incurred by the division in the previous calendar year in the course of responding to the release, including personnel hours, travel expenses, contracting costs, and any other directly associated costs incurred by the division.

(d) For purposes of this section, the following terms have the following meanings:

(1) “Field capacity” means the total gas storage capacity, including base and working gas capacity, of an underground gas storage facility, in cubic feet.

(2) “Wells” means all wells associated with an underground gas storage facility except those that have been plugged and abandoned pursuant to Section 3208 before the preceding calendar year.

(Amended by Stats. 2016, Ch. 673, Sec. 4. (SB 887) Effective January 1, 2017.)