Federal regulators last Monday issued their final report and recommendations on the deadly Pacific Gas and Electric Co. (PG&E) natural gas transmission pipeline rupture and explosion in San Bruno, CA, a year ago. The 140-page document goes into more detail about what led up to the conclusions and recommendations released at the end of August (see NGI, Aug. 5).

Separately, at the end of September, a state regulatory judge proposed coming down harder on PG&E for its 2008 fatal distribution pipeline blast in Rancho Cordova, CA. Administrative Law Judge John Wong rejected the stipulated resolutions in the PG&E-regulatory staff settlement, along with proposing to increase the proposed fine to $38 million from the settlement’s proposed $26 million. He wants the California Public Utilities Commission (CPUC) to reject the details of the deal.

PG&E responded to the final federal determination by attempting to assure stakeholders and the general public that it is implementing all of the recommendations from the National Transportation Safety Board (NTSB), and it is committed to “learn from San Bruno” and to share those lessons with the natural gas industry.

President Christopher Johns said the San Francisco-based combination utility is “implementing NTSB recommendations as part of a larger effort, both immediate and long term, to promote safer pipeline operations. PG&E will continue making fundamental changes to its operations to assure the safety of the public, our customers and our employees always comes first.”

Unsparing in its criticism, NTSB’s final report reiterated the board conclusion from Aug. 30 that the probable cause was a combination of “inadequate quality assurance and quality control” in 1956 when the failed part of PG&E’s Line 132 was relocated, and a failed pipeline integrity management program. Along with the utility’s poor pipeline management, the federal board also singled out the CPUC for criticism of its oversight of PG&E.

In listing more than two dozen recommendations, the final report reiterates needed changes among the federal and state regulators, in addition to the utility and the governor of California. In that regard the federal Pipeline and Hazardous Materials Safety Administration (PHMSA) has its share of follow-up work to do in the wake of San Bruno, which killed eight people, destroyed 34 homes and damaged another 70.

Last November the CPUC opened its penalty proceeding regarding the Dec. 24, 2008 incident involving leaking gas from a PG&E distribution pipeline that exploded and ignited a fire in the Sacramento suburb of Rancho Cordova, CA, killing one person and injuring five others. Last June the CPUC’s Consumer Protection and Safety Division (CPSD) filed a stipulated resolution. Separately, PG&E and the state’s major consumer watchdog group, The Utility Reform Network (TURN), entered another stipulation under which the combination utility agreed not to include in its next rate case the costs associated with resolving the Rancho Cordova claims and litigation.

PG&E, CPSD and TURN now have 30 days to accept the ALJ’s revised proposed penalty. If they don’t accept the $38 million figure, evidentiary hearings in the case will be held.

In offering his proposed order, Wong cited the “severity and gravity” of the incident, saying PG&E acknowledged that it “failed to provide safe and reliable service at Rancho Cordova,” and pointing to a “series of failures” by its employees to follow company “prescribed procedures.” Because of those failures the utility said it took full responsibility for the tragedy.

Timothy Alan Simon, the assigned CPUC commissioner in the investigation, said he was pleased with Wong’s proposed decision, noting it “sends a balanced message to California utilities and communities that public safety of our critical infrastructure is the highest priority to the CPUC.”

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