PG&E Fined $1.4 Billion for San Bruno Explosion

It is the largest fine in the history of the California PUC.

The California Public Utilities Commission lowered the boom on Pacific Gas and Electric on Sept. 2 for the San Bruno pipeline explosion, issuing four decisions by two administrative law judges and penalizing the company $1.4 billion. It is the largest safety-related penalty ever levied by the agency.

The ALJs issued three decisions establishing the number of violations. In the fourth decision, the judges imposed a penalty based on the total number of violations. They found that PG&E committed 3,798 violations of state and federal laws, rules, standards, or regulations in connection with the operations and practices of its gas transmission system pipeline. "Many of these violations continued for several years, resulting in a total of 18,447,803 days in violation. The $1.4 billion penalty, when combined with the amount that the CPUC previously ruled must come from shareholders for expenditures to improve the safe operation of natural gas pipelines (R.11-02-019), exceeds $2 billion," according to the agency's news release.

From the penalty, $950 million will be paid to California's General Fund, $400 million in pipeline improvements that cannot be recovered from customers, and approximately $50 million to be used to implement more than 75 remedies to enhance pipeline safety, including $30 million for the CPUC's Safety and Enforcement Division to hire independent auditors to audit PG&E's Pressure Validation project and Project Mariner implementation, training for emergencies, establishing a centralized database to track location and use of salvaged pipe in PG&E's gas transmission pipeline system, and to pay litigation expenses of intervenors.

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