‘It's Frustrating, it's Dangerous and it's Irresponsible': PG&E Fined $5.45 Million Over Natural Gas Inspections

The California Public Utilities Commission on Friday issued a $5.4 million citation against PG&E for its use of more than 100 unqualified inspectors to check exposed gas pipelines for corrosion.

Regulators stressed that the utility knew as far back as 2014 that contract crews were not certified to perform inspections and yet PG&E officials did not actually report the problem until September of this year. That report came seven months after a regulator discovered in February that an unqualified inspector had vouched for the safety of a PG&E distribution pipeline.

PG&E ultimately disclosed that some 101 unqualified inspectors had performed 500,000 suspect inspections in 2014 alone. It is not clear how the utility discovered the problem as regulators said they had to wait for the utility to authorize the release of its own assessment of the breakdown.

In a statement, the commission said the use of properly trained inspectors to do the corrosion checks was of the "utmost importance for safe pipeline operations."

It continued: "PG&E violated federal and state law by using contractors who were not properly trained or qualified, failing to check qualifications of contractors, and not having quality control and quality assurance controls in place to ensure that its contractors were qualified."

Regulators noted that the utility is reinspecting its gas distribution lines — the network of smaller gas pipes that supply individual homes and businesses. Much of the work was done before the company disclosed the issue, but re-inspection work will not be complete until mid-2017.

Sen. Jerry Hill, D-San Mateo, said state regulators should have come down harder on the utility, given its track record of withholding key information about problems in its system. He said the utility has been fined repeatedly for not promptly disclosing problems, so its failure here should have been met with more severe sanctions.

"It's the same old story over again," he said. "It's frustrating, it's dangerous and it's irresponsible to hide the use of unqualified inspectors and withhold that information to try to deceive the public."

Hill said he intends to "to look at the rationale for such a small fine."

In the San Bruno pipeline disaster, the company was penalized a total of $1.6 billion for record keeping and gas safety violations.

For its part, PG&E issued a statement after being slapped with the multi-million dollar citation.

“Nothing is more important than the safety of our customers, employees and the public," it said. "Before this issue was self-reported to the CPUC, PG&E had changed its operator qualifications process as it pertains to the AC inspections work to ensure this does not happen again, and expects to complete re-inspection of all facilities inspected by those with incomplete qualifications by the end of 2016.”

According to the CPUC, here is a list of the counties in which the inspections took place:

  • Contra Costa County
  • El Dorado County
  • Glenn County
  • Nevada County
  • Placer County
  • Sacramento County
  • San Francisco County
  • San Mateo County
  • Santa Clara County
  • Solano County
  • Sutter County
  • Yolo County
  • Yuba County
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