As part of the lingering reaction to a natural gas transmission pipeline rupture and explosion two years ago in San Bruno, CA, Gov. Jerry Brown on Sunday signed into law four bills dealing with parts of the tragedy along with two other energy-related bills. Overall, Brown signed 34 measures and vetoed five for the day.
One new law Brown signed (AB 2564) is designed to facilitate the multi-billion-dollar, multi-year pipeline enhancement programs (see Daily GPI, March 1) proposed by California's major intrastate pipeline operators -- Pacific Gas and Electric Co. (PG&E) and Sempra Energy's two utilities, Southern California Gas Co. (SoCalGas) and San Diego Gas and Electric Co. (SDG&E). The new law exempts the pipeline safety work through 2017 from certain environmental-related local agency fees and requirements.
Noting that the scope of the pipeline enhancement work, compressed into four years, is unprecedented and a "state and public safety priority," AB 2564 streamlines the environmental review requirements and fees for gas pipeline work of a mile or less in length.
Specifically, the new law's author described its purpose as "expanding the application of an existing California Environmental Quality Act exemption for pipeline projects less than one mile in length.
"AB 2564 expedites pipeline maintenance and replacement, complies with permits required by local governments, and respects the environment in an effort to prevent the San Bruno catastrophe, which claimed the lives of eight residents and injured many others, from happening again," said Assemblywoman Fiona Ma (D-San Francisco), the bill's author.
The three other pipeline bills signed into law were authored by local San Bruno state Assembly member, Jerry Hill, who has been a vocal activist for tougher requirements for pipeline operators and a frequent critic of the state oversight prior to the incident two years ago.
Hill's bills will now put more specific requirements into the law governing the California Public Utilities Commission (CPUC) regarding the state commission's responsiveness to federal National Transportation Safety Board (NTSB) requirements (AB 578) and the CPUC's establishment of a pipeline safety metric to measure the effectiveness of gas utilities' pipeline safety efforts in establishing their overall rate structure (AB 1456).
"AB 578 requires the CPUC to adopt gas pipeline safety recommendations of the NTSB if those recommendations are appropriate to California utilities," Hill said prior to Brown's signature. "The CPUC may decide not to do so, but it must submit those reasons in writing as a part of the [regulatory] commission's record of proceedings."
As for AB 1456, Hill indicated it mandates that the CPUC "adopt performance metrics for pipeline safety and evaluate the state's gas utilities against those metrics." He added that the state regulators "may levy penalties on the utility for poor performance."
Earlier, Hill alleged that PG&E had tried to "kill" his legislation and urged the CPUC to reject the utility's proposal for rate recovery for the pipeline safety plan (see Daily GPI, Feb. 3) . Subsequently, SoCalGas and SDG&E have both made similar filings for rate recovery to the CPUC.
Meanwhile, Brown signed a third bill (AB 861) that prohibits utilities from using ratepayer money for executive bonuses based on company earnings or stock price and instead requires that bonuses be paid using shareholder profits. Hill argued that "utilities are not normal corporations, and therefore "they cannot increase their profit by increasing market share or selling more product."
Finally, Brown signed AB 1650 adding to requirements and regulatory oversight for the CPUC regarding energy and water utility emergency and disaster preparedness plans.
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