PG&E Penalized $38M for Rancho Cordova Gas Blast

By Published On: December 2, 2011

A “long sequence of errors,” including substandard gas pipes and lack of oversight led the California Public Utilities Commission to fine Pacific Gas & Electric shareholders $38 million for a gas pipeline explosion in Rancho Cordova. The blast near Sacramento took one life in Dec. 24, 2008. “The lack of safety culture at PG&E must change,” commissioner Mark Ferron said Dec. 1. Regulators also bumped up commission natural gas safety efforts. They agreed to give commission staff the authority to fine natural gas companies for violating state and federal safety rules. Staff now has the power to issue written citations for violations of General Order 112-E or federal standards that are uncovered during gas company inspections. The maximum penalty increases from the $20,000 for each offense to $50,000/each as directed by recently enacted legislation. In other news, regulators approved a ruling by Ferron that clarifies the annual compliance targets for meeting the 33 percent renewable energy mandate. “It is transparent and easily understood by the market,” said Ferron. “We are drawing a straight line from where we are today to where we need to be,” he added. The 33 percent renewables mandate law, SBx1-2, set three-year alternative energy portfolio requirements. Utility supplies are to be 20 percent renewable by 2013, 25 percent renewable by 2016 and 33 percent green by 2020. Thursday’s decision sets annual milestones for utilities, community choice aggregators and electricity providers, which are to be measured in MWh. They annual targets are: – By 2014, 21.7 percent of retail sales are to be from alternative energy supplies, rising to 23.3 percent the next year and 25 percent in 2016. – The next year, renewable retail sales are to increase to 27 percent of a provider’s portfolio in 2017, inch up to 29 percent in 2018, 31 percent in 2019, and finally reach 33 percent at the end of this decade. Regulators also voted to increase the budget for the California Solar Initiative program by $200 million to cover a shortfall in non-residential programs. The vote implements SB 585 by Senator Christine Kehoe (D-San Diego) enacted earlier this year, which diverts solar subsides for residential projects to non-residential installations. --Elizabeth McCarthy & J.A. Savage CPUC Moving Toward Statewide ‘Smart’ Meter Opt-Out Program The California Public Utilities Commission is moving to allow ratepayers across the state to opt out of new power and gas meters that send utilities energy usage information through wireless communication technology. Comments are due on a proposed opt-out decision for Pacific Gas & Electric customers by Dec. 12. The decision could be finalized as early as next month. Meanwhile, the commission is calling on Southern California Edison and San Diego Gas & Electric to develop their own opt-out plans. Stop Smart Meters director Joshua Hart blasted the CPUC’s proposed decision on PG&E’s opt-out plan, calling it “Extortion. Plain and simple.” Under the CPUC’s proposed decision, PG&E customers would have to pay an upfront fee of $90 to have the radio transmitters on their meters turned off, plus $15 monthly to cover meter reader visits in lieu of wireless meter reading. Low-income customers would pay $5/month, with no upfront charge. The proposed decision by commission president Mike Peevey whittles back PG&E’s initially proposed fees, which entailed an upfront charge of either $135 with a $20 monthly fee, or $270 with a $14 monthly surcharge. The CPUC’s move to allow customers to opt-out of so-called “smart” meters comes after a campaign by people concerned largely about radio frequency radiation emitted by the devices. Since at least the summer of 2010, activists have attended commission business meetings to voice concerns about the potential health effects of the meters. They have asked for a halt on their installation or, asked for post-installation removal (Current, Aug. 20, 2010). In a compromise move, the commission prevailed upon PG&E to propose an opt-out plan earlier this year. Concern about the meters spread to Southern California where the Utility Consumers’ Action Network petitioned the commission to order SDG&E to prepare an opt-out plan. Santa Barbara County requested that Edison to do the same. The commission is seeking comments in those proceedings. In initial filings last month, utilities did not challenge the directive to develop opt-out plans as long as they are “technologically feasible,” have a “reasonable” cost, and do not hinder the state’s effort to develop a “smart grid.” The meters are envisioned as a way to provide customers with real-time information on their home and business energy use in an effort to get them to conserve. Eventually, the meters are to be linked to energy-using devices in the home that can be turned on and off remotely during power crunches to relieve stress on the grid, and provide data for a “smarter” grid, among other uses. Once the opt-out program is approved, PG&E expects about 150,000 of its customers to elect to have the radio transmitters on their meters turned off. The hotbed for meter activism has been in Marin, Santa Cruz, Sonoma, San Francisco, and Santa Barbara Counties, though concern has arisen in other areas too. Tea Party Patriots and the Eagle Forum--an anti-feminist and property rights oriented group started by Phyllis Schlafly--have been heavily involved in the fight against the wireless meters. The groups see them an invasion of privacy because they produce real time data on energy usage and because they are closely associated with energy conservation, which they see as government rationing and an interference with the free market (Current, May 27, 2011). A decision on opt-out plans for SDG&E and Edison is likely sometime next year.

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