PG&E Says San Bruno Blast May Cost $1 Billion; State Says It Can Afford Twice That

Monday, September 03, 2012

At just about the same time the CEO of Pacific Gas & Electric Co. (PG&E) was telling the press Thursday that the deadly 2010 San Bruno gas explosion might cost the company $1 billion, a court computer mistake inadvertently revealed for the first time a private lawsuit settlement figure from the disaster.

A page on the San Mateo County Superior Court website showed that PG&E paid nearly $2.5 million to settle with a teenage girl who was severely burned after a failed pipeline weld triggered a blast that killed eight people and razed a neighborhood. About one-fourth of 400 known plaintiffs have reached a settlement with the utility, but this is the first that did not remain confidential.

Regulators have accused PG&E of shoddy record keeping, failure to do required tests, control room breakdowns, a crummy emergency response and a culture that “emphasized profits over safety.”

PG&E had estimated earlier that claim settlements might cost the company $455 million and spokeswoman Brittany Chord said the company spent $145 million for that during the quarter ending in June.

CEO Anthony Earley said the total cost of the explosion could reach $1 billion, including money spent on repairs and $200 million in fines it expects to pay.

Earley’s estimate leaves a lot of room between what PG&E expects to pay in fines and the $2.55 billion that a PUC consulting firm reported the utility could afford. Overland Consulting of Kansas informed the agency in May that the utility could sell $2.25 billion in stock and add that to $300 million already salted away for the occasion without threatening the company’s viability, according to the San Francisco Chronicle, which reviewed the 15-page document.

It was not suggested that PG&E actually pay that sum, which would dwarf the previous record of $38 million, also paid by PG&E, for the 2008 Rancho Cordova pipeline blast that killed a homeowner.     

–Ken Broder

 

To Learn More:

San Mateo County Court Mistakenly Posts Secret San Bruno Fire Settlement (by Joshua Melvin, San Mateo County Times)

PG&E Can Handle Big Fine—Report (by Jaxon Van Derbeken, San Francisco Chronicle)

Court Mistakenly Posts Secret Pipeline Settlement (Associated Press)

PUC Not Impressed by PG&E “Jingles and Slogans” Since San Bruno Explosion (by Ken Broder, AllGov)

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