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California Regulators Issue $5.45M Penalty Against PG&E

California regulators last Friday issued a $5.45 million staff safety citation against Pacific Gas and Electric Co. (PG&E) in a case of utility-divulged violations. PG&E has 30 days to either pay the fine or appeal the citation.

PG&E was penalized for using non-qualified contractors to perform inspections and for related violations by the California Public Utilities Commission (CPUC) based on the CPUC Safety and Enforcement Division's (SED) investigation and its review of PG&E's self-reported violations last September.

"SED found an instance [dating back to February] of a PG&E contractor who had previously performed atmospheric corrosion inspections on PG&E’s natural gas system but lacked the required qualifications," said a CPUC spokesperson. Then in September, "PG&E filed a report with the CPUC stating that 101 non-qualified contractor inspectors conducted approximately half a million atmospheric corrosion inspections in seven areas of PG&E’s service territory between February and May 2014 and in November 2014."

The inspections are viewed as critical to ensuring safe pipeline operations, CPUC said.

"PG&E violated federal and state law by using contractors who were not properly trained or qualified, failing to check qualifications of the contractors, and not having quality control and quality assurance controls in place to ensure that its contractors were qualified," the commission said.

State regulators acknowledged that the San Francisco-based combination utility since its self-reporting has taken corrective actions by performing re-inspections of its distribution pipeline system, which was originally inspected by non-operator qualified personnel. The majority of the re-inspections have been completed, and PG&E has promised to complete the rest of them by the second quarter, according to the CPUC.

"The CPUC SED will continue to monitor these corrective actions to ensure compliance with law," the CPUC said.

Under CPUC requirements, any unsafe condition must be immediately corrected, and the SED has staff-level authority to issue citations to gas companies for violation of CPUC or federal gas safety codes and regulations. Penalties can be up to $8 million per citation.

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