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Puget Sound Energy Reaches $2.75M Settlement For Seattle NatGas Pipeline Explosion

Bellevue, WA-based Puget Sound Energy (PSE) and the state’s regulatory staff said Tuesday they have reached a $2.75 million settlement for the combination utility’s role in a natural gas pipeline explosion in Seattle last year.

The Utilities and Transportation Commission (UTC) agreed to suspend $1.25 million of the $2.75 million penalty on the condition that PSE completes a “comprehensive inspection and remediation program."

The public counsel unit in the Washington state Attorney General's Office participated in the negotiations but took no formal position on the agreement, but the parties acknowledged that it could at a later date could join or oppose the agreement.

Last fall, UTC staff filed a formal complaint against PSE, alleging the company committed 17 violations of pipeline safety regulations and recommended a penalty of up to $3.2 million for a broken gas service line that PSE records showed as abandoned. The pipeline had never been properly disconnected.

The investigators alleged that PSE failed to properly disconnect and seal the line, allowing it to remain in service for nearly 12 years without proper oversight.

The settlement, which now goes to the three-member UTC for final disposition, includes a detailed compliance program covering four different categories of pipelines to be dealt with over varying time frames ranging from 18 to 36 months. The work schedule calls out thousands of locations and more than 40,000 service lines for identification, inspection and remediation work.

"If the company discovers an active gas line in the sample from Groups 2-4, PSE must inspect all locations within that group and file an amended compliance plan with the commission," said a UTC spokesperson.

In addition, the settlement commits PSE to evaluating active, above-ground service pipes as part of the utility's regular inspection process with an enhanced focus on pipes susceptible to external damage, including tampering or vandalism.

Also under the settlement, PSE must review its standards and practices related to deactivating service lines and implement employee training on any changes in the procedures.

Last September UTC pipeline safety staff released the results of its investigation in the cause of the March 2016 explosion that injured nine firefighters and caused extensive property damage, identifying an aboveground service line as the immediate cause of the mishap. "It was found the line had been improperly retired in 2004, and had remained active until it was shut off after the explosion," the UTC report said.

The complaint alleged five violations related to the improper closing of the pipeline and failure by PSE to perform periodic gas leak surveys and corrosion tests as required by pipeline safety regulations. UTC said that in the settlement PSE did not contest the five violations.

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