State PUC reviews $3 million PG&E fine

In this Sept. 9, 2010 file photo, a massive fire roars through a mostly residential neighborhood in San Bruno, Calif. (AP Photo/Jeff Chiu, File)

April 11, 2011 6:37:12 PM PDT
There is a major difference of opinion on what PG&E should have to pay for missing a deadline in the San Bruno pipeline investigation. The utility has agreed to a $3 million fine, but may never be able to meet a demand for records dating back 50 years or more. The penalty is now in the hands of an administrative law judge.

At the start of the year, PG&E was ordered to produce safety records for its gas pipelines by March 15. However, the search proved difficult. In a series of meetings, PG&E said it told the staff of the California Public Utilities Commission the deadline couldn't be met.

PG&E attorney Joe Malkin said it's their opinion that the fine should have been $20,000.

"We thought it was clearly understood, certainly by all of the staff people we were meeting with, what we were going to be to physically do and what we would physically do later," said Malkin.

When PG&E failed to comply, it faced a hefty fine. Unknown to at least two of the state commissioners, the PUC staff had negotiated a $3 million fine, plus another $3 million if it misses a second deadline in August. The commission must now decide whether to approve, amend or reject the settlement. Watchdog groups, such as The Utility Reform Network, say PG&E should face a stiffer penalty if it fails to produce the records by a new deadline in August.

"If they do fail to meet the deadlines and the compliance plan, should be increased more in the range of $30 million, not just another $3 million," said TURN attorney Marcel Hawiger.

PG&E spokesman Joe Molica says it is continuing to search for the requested documents.

"This was a monumental effort that we worked extremely hard to meet, and in some cases, there were pipeline records that still may be missing, and that effort continues," said Molica.

The executive director of the state PUC, Paul Clanon, declined to address any misunderstanding between PG&E and his staff over the original March 15 deadline.

"We need those people doing that record search and doing the engineering analysis," said Clanon.

PG&E's top gas engineer updated the commission on its on-going safety program. As part of that effort, 20 high-risk leaks were discovered and repaired.

For now, PG&E says it agrees with the stipulated fine of $3 million now and an additional $3 million if it doesn't produce all the records by the end of August. It says it wants to move on.

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