Report Claims PG&E Committed Thousands of Safety Violations

By Published On: June 1, 2012

Pacific Gas & Electric could face over $1 billion in fines for more than 3,000 alleged violations of pipeline safety rules in areas of high population density, an investigative report by a California Public Utilities Commission division revealed May 25. The commission’s Consumer Protection & Safety Division “believes that between 1971 and 2012, PG&E has committed numerous and serious violations” of federal and state laws and regulations and PG&E procedures, according to its report. “The violations presented significant risks to the public and went unreported for many years although PG&E should have recognized the obvious weaknesses.” The division claims PG&E violated 3,062 standards resulting in about 16 million daily counts, most of which have maximum penalties between $20,000 and $50,000 per day. It urges regulators to levy significant penalties. “PG&E Corp. and the utility are unable to estimate the reasonably possible amount of penalties in excess of the amount accrued, and such amounts could be material,” PG&E’s stated in a May 29 Securities & Exchange Commission filing. PG&E claimed it has set aside $200 million in shareholder funds for potential liabilities. The report asserts PG&E failed to properly monitor the maximum pressure it allowed in its pipes and at times exceeded allowable levels. The maximum allowable pressure is federally mandated “with a safety factor to ensure protection of the public,” to avoid ruptures that can kill people and damage property, the reports notes. The report points out that the utility admitted it failed to identify nearly 900 pipeline segments with class location changes on its gas transmission system, failed to patrol 150 miles of pipe segments, and did not have monitoring records for 100 miles of its pipes. Changes in class category--based on changes in population density or expansion of the pipeline itself--were of particular interest to the consumer safety division because they “represented a significant public hazard since the misclassified segment would be operating with a lower safety.” PG&E’s pipeline system includes approximately 1,060 miles of pipelines in densely populated areas. The utility is also the subject of two other ongoing investigations. PG&E’s response to the consumer safety division’s report is due July 23 and evidentiary hearings are scheduled for August.

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