Calif. may lower fines for utility in fatal blast

AP News
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Posted: Mar 25, 2011 12:43 AM
Calif. may lower fines for utility in fatal blast

California regulators proposed on Thursday to fine a utility for a deadly pipeline blast as little as $3 million, instead of moving ahead with a prior approach to charge the company about $1 million each day for shoddy record-keeping.

The California Public Utilities Commission unanimously approved a motion Thursday ordering Pacific Gas & Electric Co. to appear on Monday at a hearing for a discussion of the new proposed agreement that could significantly lower the company's penalties.

Last week, the commission's executive director had said PG&E could face fines of $1 million a day or more for failing to hand over key safety records for its transmission lines, including for sections of the aging natural gas line that blew in San Bruno.

But Thursday, Paul Clanon asked commissioners to instead mull over a new proposal that would require the utility to jumpstart testing of its transmission lines running beneath some of the state's largest cities.

If the company does not pressure-test certain high-risk lines or experiences any unexcused delays, fines could rise to $6 million, he added.

"This is a very public and enforceable way to get this information," Clanon said. "We don't want to spend months in litigation."

The Sept. 9 blast killed eight people and destroyed three dozen homes in San Bruno.

Regulators ordered PG&E to provide detailed engineering records soon after the accident. The utility provided summary documents, but company officials acknowledged they could not find key safety records for 8 percent of lines running through populated areas.

Regulators and lawmakers have sharply criticized PG&E for relying on documents showing historical pressure levels for older pipelines rather than actual pressure tests or engineering work.

The utility could not turn up pressure tests for 69 percent of transmission lines laid before 1961 in densely populated areas.

PG&E spokesman Joe Molica said the company would pay the first $3 million installment of the proposed reduced fines within 10 days if the commission approves the tentative agreement, which could happen as soon as April 14.

"Safety is our highest responsibility and we share the commission's goal of enhancing the safety of the natural gas system," Molica said.

Assemblyman Jerry Hill, a Democrat whose district includes San Bruno, said he was troubled by what he termed a "backroom deal," in which the utility would not admit wrongdoing.

"This type of dealing erodes my faith in the public and transparent process the commission had promised," Hill said in a statement Thursday. "The PUC's decision looks to be premature _ especially when records remain unavailable for hundreds of miles of pipeline that could ignite another explosion. The PUC should wait until the end of the administrative process before agreeing to a fine amount."