The plan comes after a request from the California Public Utilities Commission for all of the state's natural gas transmission line operators to come up with a plan to test or replace all untested pipelines.
The pipe that ruptured in San Bruno a year ago was installed in 1956, before a 1970 law requiring regular strength tests.
After the explosion, PG&E discovered its records about what kind of pipe it had underground were inaccurate. It now says it will verify and upgrade all of its nearly 6,000 miles of transmission lines to meet new state standards.
"It's a clear break between what the standards are now and where we're going to go; this is all about making our pipeline system safer," PG&E spokesperson David Eisenhauer said.
The plan filed with the CPUC Friday calls for strength testing all pipes not already tested, replacing if necessary and retrofitting pipes to allow inline inspections, enhanced electronic monitoring, expanded use of automated valves and consolidating all remaining paper records into a computerized system.
The plan will cost about $2.2 billion, with shareholders absorbing more than $500,000, leaving ratepayers with a monthly increase of about $2.
"These are expenditures that are critically important for us to have safe pipelines and make sure that our customers and people who live near our pipelines can have the confidence they're near a safe pipeline," Eisenhauer said.
"Well, I guess I'm going to fire them and go with a competitor, oh that's right I can't do that, can I? That's what happens when you're a monopoly, so you can make it work out however you want and you'll never lose money," San Bruno resident Phil Piserchio said.
The CPUC does still have to approve the plan and costs.
Assm. Jerry Hill, D-San Bruno, hopes they will not approve the current version.
"Over $2 billion of expected expenditures, and they're looking to the rate payers to pick up 90 percent of that cost, 90 percent, and that's at the same time when over those years they've been negligent in the manner in which they've provided maintenance, they've been negligent in the manner in which they've abused and illegally spiked their pipes," Hill said.
Eight people died and 38 homes were destroyed in the San Bruno explosion and resulting fire.
Next week, the National Transportation Safety Board is expected to issue its final report on the probable cause of the blast.