Along with billions of dollars to make over its natural gas pipeline system, Pacific Gas and Electric Co. (PG&E) with 50,000 miles of distribution and transmission pipes is depending on all of its employees to speak up in identifying unsafe equipment, systems and processes, PG&E gas executive Nick Stavropoulos told NGI.

Self-reporting, or whistle blowing, by rank-and-file employees is making the difference as the large San Francisco-based combination utility attempts to bounce back from nearly two years of close public scrutiny and criticism since one of its high-pressure transmission pipelines ruptured, killing eight people and devastating a residential community in suburban San Bruno, CA.

"I'm encouraged by our team because individuals are coming forward to identify opportunities for us to improve and get better," Stavropoulos said. "I'm encouraged because if we were not seeing that...then I would begin to worry. People feel safe now in reporting up [the management chain] what they find."

Despite negative reactions from state regulatory safety staff (see Daily GPI, June 7), Stavropoulos said he sees the increase in reports on problems within the organization as a sign the utility is making progress in its quest to become one of the safest pipeline systems in the nation. "We're being very open, honest and transparent, and extremely conservative in reporting these violations," he said.

California pipeline operators now are adhering to a "brand new standard" in more self-reporting of incidents to the California Public Utilities Commission (CPUC), said Stavropoulos. He said self-reporting is intended to be for violations of state or federal regulations, but PG&E has interpreted it to include instances in which the utility violates its own internal company standards that may be, and often are, more stringent than the regulatory rules.

"If we don't meet our own internal standard that is above and beyond anything required in the regulations, then we report that, too. We're going to the other extreme, trying to self-report everything [that deviates from utility standards]."

PG&E has been focusing on up to a dozen recommendations from the National Transportation Safety Board (NTSB), and in a report last month it detailed how it is making "fundamental changes" to its operations and management practices throughout its gas organization. Those changes include completing a validation of maximum allowable operating pressure (MAOP) for more than 2,000 miles of transmission pipelines running through high-consequence areas, and validation of another 1,000 miles of pipelines in more remote areas.

Along with developing the internal "safety culture" and brutal honesty, rate support for a $2.2 billion four-year pipeline enhancement program is critical to the utility building a pipeline system that adheres to the highest standards, Stavropoulos said. That's the other critical issue he faces: getting the CPUC to approve recovery of the vast bulk of the expenditures in retail utility rates. He doesn't know the exact numbers, but Stavropoulos is aware similar multi-billion-dollar pipeline update programs are under way elsewhere as more states come up with updated pipeline safety requirements.

"They are also developing innovative cost-recovery mechanisms to support those programs for pipeline operators to replace aging infrastructure," he said. "I'm very encouraged nationally by all this. Like your highways, assets do age, and they need to be replaced."

©Copyright 2012 Intelligence Press Inc. All rights reserved. The preceding news report may not be republished or redistributed, in whole or in part, in any form, without prior written consent of Intelligence Press, Inc.