In a separate proceeding closely watched by the gas industry, California safety regulators have proposed that PG&E be fined a record $2.25 billion for violating rules on recordkeeping, pipeline classification and the direct causes of the blast.
PG&E has warned that if such a fine is approved, it could hamper its efforts to raise equity to pay for safety improvements. The administrative law judge’s proposed decision in that proceeding has been awaited all year.
“San Bruno was a tragic accident,” the utility said in its statement. “We have worked hard to do the right thing for victims, their families and the community, and we will continue to do so.”
PG&E said it has already committed to spend about $2.7 billion of shareholder money to test and upgrade its system and that it has completed nine of the 12 safety recommendations made by the NTSB, with work on the final three progressing. The utility has also settled claims amounting to nearly $500 million with the victims and families of the San Bruno accident, established a $50 million trust for San Bruno for recovery costs and contributed $70 million to support city and community recovery efforts.
“PG&E thinks they should get credit for progress they’ve made since the incident, but we think it should have been done over the last 50 years instead of so much money going to shareholders,” Ruane says.
Bryan Foster, a San Bruno resident who witnessed the blast, filed a research report to the California Dept. of Justice last September that futher alleges the utility was operating the pipeline to supply only one customer—a power plant illegally retrofitted in 2008 with natural gas turbines.
The section that exploded was a sole-source, dedicated fuel line, running from San Bruno into San Francisco, to the Mirant Power Plant located in the Hunter's Point District.
The operating pressure of the pipeline was nearly 100 psi over what federal guidelines allowed when it exploded, NTSB said in its report.
“We’re glad that the Justice Department is drilling down into this case,” said Carl Weimer, executive director of independent safety group the Pipeline Safety Trust. “The level of this fine, at $1 billion, is likely sending a message not just to PG&E but to the industry as a whole. He said a settlement in the case is likely already under discussion. “Between the $1 billion federal case and the $2.25 billion state case, these are huge issues,” Weimer added.