PG&E Fine Rejected as Low

Posted on October 4, 2011

PG&E’s Rancho Cordova blast fine rejected as low
UTILITIESSeptember 30, 2011|Jaxon Van Derbeken, Chronicle Staff Writer

Rancho Cordova, Sacramento County — An administrative law judge on Thursday rejected as too lenient a $26 million fine against Pacific Gas and Electric Co. that the utility agreed to with state regulators for a 2008 natural gas pipeline explosion near Sacramento that killed a homeowner.

Instead, the judge recommended that PG&E be fined $38 million for breaking state and federal safety laws. If upheld, it would be the largest regulatory penalty ever against a California utility.

Judge John Wong, an administrative law judge for the California Public Utilities Commission, said a $38 million fine “is appropriate given the allegations in this investigation, PG&E’s acknowledgement and admissions, and the gravity and severity” of the blast in Rancho Cordova (Sacramento County) on Christmas Eve 2008.

The explosion happened after gas leaking from a distribution line that PG&E had earlier repaired using substandard pipe filled the home of 72-year-old Wilbert “Bill” Paana. His granddaughter lit a cigarette and the house exploded, killing Paana and badly injuring the granddaughter and her mother.

3-hour wait for help
Wong noted that it had taken PG&E almost three hours to dispatch properly equipped and trained workers to respond to a report of a gas leak in the neighborhood. The workers finally arrived just before the explosion.

The $26 million fine that PG&E agreed to in June with the Public Utilities Commission’s staff, Wong said, is “unreasonable and not in the public interest.”

Boosting the fine to $38 million will “send a clear message to PG&E that safety and reliability of its natural gas system must be its No. 1 priority,” Wong said. The company needs to be taught a lesson, he said, that its “lack of action and lack of initiative” on safety measures are unacceptable.

PG&E and the state commission have 30 days to decide whether to accept the higher fine.

David Eisenhauer, spokesman for PG&E, said the company was reviewing the decision and giving it “the full attention it deserves.”

If PG&E doesn’t agree to the fine, an administrative law judge will hold a hearing on the matter. Wong said that the company, if found guilty of every alleged violation, could be fined as much as $97 million.

Substandard pipe

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