PG&E Fined $8.1 Million for Contractor Skipping a Third of Gas Pipeline Inspections

Friday, November 08, 2013

California’s Public Utilities Commission (PUC) fined Pacific Gas & Electric (PG&E) $8.1 million because a contractor performed “non-standard” tests on gas pipelines after the 2010 San Bruno pipeline blast killed eight people and leveled a neighborhood.

By “non-standard” testing, the PUC means a bunch of critical pipe welds were skipped during inspections. TC Inspections Inc. of Rodeo was hired to check natural gas lines running under Oakland, El Cerrito, Livermore, Petaluma, Lodi and Manteca, and the Calaveras County hamlets of San Andreas and Valley Springs.

State and federal regulations require that the pipe welds be x-rayed from three angles, thereby covering the entire girth of the pipe, according the San Francisco Chronicle. The company x-rayed from two angles, leaving a portion of each weld unexamined. The failure of a weld, following years of neglect and spurious inspections by PG&E, led directly to the San Bruno disaster.

The PUC fined the utility in this instance because it is legally responsible for the work of its contractors. PG&E can appeal the fine.

PG&E engineer Sumeet Singh told the Chronicle that the pipelines in question were being re-excavated and reinspected out of an “abundance of caution,” and they have not yet found any problems.

The director of the PUC’s Safety and Enforcement Division, Brigadier General (CA) Jack Hagan, said the citation was only the “latest reminder” of the utility’s “serious lapses.”

“It is totally unacceptable that prior to March of this year—two and a half years after the San Bruno tragedy—PG&E could employ contractors for important testing that would do such shoddy work, and still more unacceptable is that PG&E would do such poor quality control of their contractor,” Hagan said in a press release.

The TC Inspections-related fine comes just days after the PUC fined the utility $17.25 million for its handling of pipeline inspections in the city of San Carlos. PG&E was ordered to shut down a major pipeline after internal e-mails from an engineer surfaced that indicated officials knew there were potentially serious problems while telling the city everything tested out fine.

The engineer had cautioned higher-ups: “Are we sitting on a San Bruno situation? With fatigue crack growth over many years? Is the pipe cracked and near failure? I don’t want people to panic but seems like we should consider this and probably move this pipe up the PSEP priority for replacement.”

They didn’t—until they were caught.

–Ken Broder


To Learn More:

PG&E Fined $8 Million for Flawed Pipe Inspections (by Jaxon Van Derbeken, San Francisco Chronicle)

PG&E's CEO Calls for Probe of Utility's Management (by George Avalos, Oakland Tribune)

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

CPUC Issues $8.1 Million Staff Citation to PG&E for Non-Standard Pipeline Testing (California Public Utilities Commission) (pdf)

Leave a comment