One day after PG&E began pressure-testing a part of its pipeline system, the utility was told it could face a far more costly and time-consuming program to verify the safety of its oldest pipes.
In a tentative ruling Tuesday from an administrative law judge, PG&E was told to pressure-test or replace 705 miles of its natural gas transmission pipelines, which could take five years, cost upward of $350 million and inconvenience customers.
The proposed decision by administrative law judge Maribeth A. Bushey is the latest and most far-reaching order to hit the utility in the aftermath of the Sept. 9 San Bruno natural gas line explosion that killed eight people and destroyed 38 homes.
“PG&E needs to rebuild the Commission’s and the public’s trust in the safety of its operations,” Bushey, the administrative law judge for the California Public Utilities Commission, wrote in the proposed decision.
PG&E said it is “closely reviewing” the decision and will work with the commission to improve safety industrywide.
“Today’s proposed decision is a positive step in raising the public-safety bar as we work to verify our records and validate safe operating pressures for our pipelines,” said Brittany Chord, a PG&E spokeswoman.
On Monday, PG&E began testing 152 miles of its natural gas transmission system. The judge’s proposed order would dramatically increase the number of miles it would need to examine and comes amid concerns about the company’s records on its pipes.
‘A national model’
PUC spokeswoman Terrie Prosper said PG&E must submit a plan for how it plans to test the pipes, which previously have not had pressure tests, and how the cost would be shared by ratepayers and shareholders. PG&E estimates the cost of pressure testing a mile of pipeline at $150,000 to $500,000.
The earliest the commission could vote on the proposal, which is expected to be approved, is June 9. The order gives PG&E 60 days to submit plans for testing or replacing pipelines.
“The proposed decision is pretty strong,” Prosper said, noting that such an expansive pipeline testing regime is unprecedented in the industry and would be “a national model.”
“It’s a huge undertaking,” Prosper said. “San Bruno was a game-changer. We have to be absolutely certain that utilities know what’s in the ground so that we don’t have another San Bruno.”
Parts of the order also affect the state’s other regulated natural gas utilities — Southern California Gas Company, Southwest Gas, and San Diego Gas and Electric Company.
PG&E conducted its first test Monday on a 1.5-mile section in Mountain View. The line passed the test.
“We understand that the issues at hand implicate substantial expenses and capital investments,” Bushey wrote. These can be debated, she said, but “attempts at legal exculpation have no place in our proceedings to address these urgent issues.”
The untested pipelines are “some of the oldest in the natural gas transmission system.” Bushey noted.
The judge’s proposed directive was set in motion by the National Transportation Safety Board’s discovery that the utility’s records incorrectly described the line that exploded as seamless, when in fact it had seams. The line came apart at a defective seam weld. The line had not been pressure-tested, which is a preferred method for detecting flawed seam welds.
Sharing a financial burden
In addition, the San Bruno pipe burst at a pressure that was less than what PG&E thought was safe. Further troubling state regulators was the utility’s inability to find records supporting the existing pressure levels on some of its oldest pipes.
TURN, The Utility Reform Network, said it will review the proposal to make sure the financial burden doesn’t fall entirely on customers.
“A plan for pipeline testing is overdue,” TURN staff attorney Marcel Hawiger said. “TURN will carefully review the proposed decision to make sure it puts customer safety first. The expenses of this testing cannot all fall on ratepayers; shareholders must bear some of the burden,” Hawiger said.
Contact Pete Carey at 408-920-5419.
