Feds File Criminal Charges against PG&E for Deadly San Bruno Pipeline Blast

Wednesday, April 02, 2014
(photo: Brent Ward, San Francisco Chronicle)

It is rare, but not unheard of, for federal criminal charges to be brought against a utility for safety misdeeds, but not rare for an indictment to lack the names of any individual culprits.

On Tuesday, a federal grand jury indicted Pacific Gas & Electric Co. (PG&E) on 12 counts involving safety violations that led to the 2010 San Bruno natural gas pipeline explosion, which killed eight people and leveled a neighborhood in the Bay Area. No executives were initially named in the indictment (pdf).

“Despite knowledge of these deficiencies, PG&E did not keep a record-keeping system for gas operations that would ensure that pipeline records were accessible, traceable, verifiable, accurate and complete,” the indictment said.

Although the penalties amount to only $6 million, a conviction could result in government oversight of prescribed remedies. The indictment is only the latest public rebuke to the utility. Last September, PG&E settled lawsuits from 499 people for $565 million.

The state Public Utilities Commission (PUC) is considering fines of up to $2.25 billion, but hit a roadblock last June when its staff recommended that most of the penalty was essentially paid after crediting money being spent on already-required infrastructure upgrades.  

Public uproar and objections from members of its own legal team sent the PUC back behind closed doors to figure out a solution.

The U.S. Attorney’s office loaded the indictment with information from a National Transportation Safety Board (NTSB) finding in 2011 that PG&E was responsible for the blast. The utility was accused of repeatedly violating the federal Pipeline Safety Act by not having critical infrastructure data, not conducting proper inspections and not having a plan to identify and handle risks.

Specifically, PG&E knew it lacked data on the strength of 55-year-old Line 132 in San Bruno. The pipe had a bad seam weld from the get-go, but PG&E didn’t have records that the pipe even had seams. The company avoided more-expensive water-pressure testing to find out if it might not hold up, and then raised the pressure on a few occasions to make its quotas.

“PG&E believes that its employees did not intentionally violate the federal Pipeline Safety Act, and that even where mistakes were made, employees were acting in good faith to provide customers with safe, reliable and affordable energy,” CEO Tony Earley said in a statement.

–Ken Broder


To Learn More:

PG&E Indicted on 12 Charges in San Bruno Blast Case (by Jaxon Van Derbeken, San Francisco Chronicle)

PG&E Indicted on Criminal Charges by Federal Grand Jury over San Bruno (by George Avalos, Oakland Tribune)

State Regulators Flip on San Bruno Blast, Seek $300 Million Fine for PG&E (by Ken Broder, AllGov California)

United States of Amercia v. Pacific Gas & Electric (U.S. District Court for the Northern District of California) (pdf)

Leave a comment