While recording a 1Q2014 $40 million charge after nearly $3 billion in safety-related natural gas pipeline work, Pacific Gas and Electric Co. (PG&E) also reported Thursday that a recent house consultant's report shows the utility's use of pipe records needs improvements.
This comes after PG&E senior executives reported the one-time earnings charge equating to five cents/share was related to costs and legal charges incurred since the fatal 2010 San Bruno pipeline rupture (see Daily GPI, Sept. 13, 2010). Overall costs borne by utility shareholders amount to $2.7 billion, according to P&GE CEO Tony Earley.
Earley also cited a PG&E-commissioned investigation by a third-party consultant of a natural gas explosion in a home in March this year that renewed concerns about the combination utility's ability to maintain adequate records for its natural gas pipeline system (see Daily GPI, March 17).
Menlo Park-based Exponent Inc. concluded that the case of the Carmel, CA, home pipeline explosion was another instance of PG&E having "inadequate verification of system status and configuration when performing work on a live [pipe]line." And as a result, the report recommends a number changes in the utility's procedures to assure "positive verification" of a pipeline's real-time status.
In this case, utility workers cut into a cast iron pipe that previously had been fitted with a plastic pipe insert. A PG&E spokesperson at the time told NGI that it was a case of the utility's pipeline records not matching what was in the ground.
With the release of the latest financial impact and the Carmel gas explosion in an unoccupied home, PG&E's spokesperson said the utility was grateful no one was injured in the blast and it has "taken very seriously" the incident.
"We are committed to taking every action possible to make sure that it's not repeated," he said. "From the time of the incident, we have implemented changes to field processes addressed in the report's findings."
PG&E claims it has been proactive and has not waited for the report to take action. Earley said no regulators or local community officials so far have commented on the report.
"Since the incident, we have enhanced the step-by-step process used by our gas employees before tapping on a pipeline, which is a common drilling practice used across the industry. We embrace the report's findings."
Fundamental to the Carmel incident is that gas utility workers need to always make sure they verify that what is in the ground matches the company's pipeline records, the spokesperson said.