Information from a state regulatory commission staff audit released by a local congresswoman last week raised more questions about the thoroughness of Pacific Gas and Electric Co.’s (PG&E) maintenance repair and replacement work on its natural gas transmission pipeline system, and specifically Line 132, which suffered a tragic segment rupture in San Bruno, CA, last year.

In question is a total of $183 million in ratepayer funds authorized by the California Public Utilities Commission (CPUC) in the late 1980s and 1990s for which there is no repair or replacement work accounted for, according to information that Rep. Jackie Speier (D-CA) made public from the latest CPUC review of the 1987-1999 period. The CPUC said the expenditures were authorized as part of three separate PG&E general rate case decisions during the period.

In more recent years (2000-2010), PG&E has overspent on pipeline safety-related work, according to the CPUC information provided to Speier’s office.

Later in the week PG&E countered the public criticism by noting that it had invested nearly $1.5 billion during the past 26 years to replace one-third of its natural gas transmission system. The San Francisco-based utility wanted to put in perspective concerns and alleged inconsistencies cited by officials regarding its work before and after the catastrophic pipeline rupture last year.

In response to queries from NGI, a utility spokesperson last Wednesday said about 2,100 miles of the 6,000-mile transmission system have been replaced as part of PG&E’s pipeline replacement program, which has been ongoing since 1985. And during those years — particularly in the 1980s and 90s — the priority of various pipe testing and replacement changed frequently. Some changes were caused by major natural disasters in the San Francisco Bay Area.

Earlier Speier had criticized the combination utility for allegedly scrimping in the past on replacement of pipe that it is now spending millions of dollars to hydrostatically test. In addition, local news reports indicated that sections of Line 132 were all replaced more recently except for a half-mile stretch that includes the segment that failed.

PG&E confirmed that long stretches of Line 132 in San Bruno, both south and north of the ruptured segment, were replaced, but an approximate half-mile segment that included the section that failed was not replaced. The utility spokesperson also said none of the $183 million of unused funds was used for part of the long-term pipeline replacement effort.

“The [Line 132] project was developed and completed to address seismic concerns related to segments to the north and south of the accident site,” the PG&E spokesperson told NGI. The utility’s gas pipeline replacement program (GPRP) was established to replace pipe throughout PG&E’s territory, using a “prioritization model,” she said.

“This model was developed jointly between PG&E operations and our geosciences department and [it] established prioritization factors that included pipe material or welding techniques, leak history, presence of cathodic protection on the pipe, structure and population proximity and seismic vulnerability.”

For Line 132 in San Bruno, the geosciences unit focused on seismic risks and a GPRP project was developed and completed to address seismic concerns specifically in that area, the spokesperson said. “Based on our program criteria, the segment involved in this terrible tragedy was not part of the project.”

After initially asking the CPUC for the audit in March, Speier last week was critical of PG&E concerning the time it has taken to obtain information from the utility. “I am assured by the CPUC that the new monitoring practice will strengthen its oversight of natural gas operators,” the congresswoman said.

Noting that the latest audit information confirms that PG&E’s gas operations need to be more closely monitored, Speier said, “PG&E is now required to file a safety report twice a year on its operation, inspection and replacement of pipelines with full scrutiny placed on how authorized money is spent. Obviously, this degree of monitoring didn’t exist when PG&E decided to forgo replacing aging pipelines in San Bruno in the early 1990s.

“In fact, PG&E decided not to replace the very pipelines it is now going to spend millions to hydrotest. It is tragic that it took a disaster that killed eight people to bring to light the ramifications of $183 million in underspending.”

In the 1985-1999 time period PG&E acknowledges that it spent less than was originally forecast for the GPRP, but the spokesperson said it is “important to note” that the utility kept the pipeline program on schedule throughout those years. “At the approximate halfway point, PG&E had replaced 57% of the transmission pipe in the GPRP. We were getting more efficient at replacing gas transmission lines.”

More than a decade later, PG&E cannot trace precisely whether all of the GPRP funds were spent, but the spokesperson contends that the utility is certain it spent money on “the highest priority work to maintain the safety and reliability of its system.”

For instance, she said, projects that were deemed high priority included those to deal with the 1989 Loma Prieta earthquake and the 1991 Oakland Hills firestorm, as well as reappropriating funds to accommodate customer growth when it exceeded forecasts.

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