April 2, 2014
PG&E Corporation (NYSE: PCG) and its subsidiary, Pacific Gas and Electric Company, pledged to stay focused on building the safest and most reliable natural gas system in the country despite what it expects will be a lengthy legal process to demonstrate that federal criminal charges filed have no merit.
The charges were filed by the U.S. Attorney's Office in San Francisco in connection with the 2010 San Bruno natural gas transmission pipeline accident. The charges allege that PG&E's past operating practices violated the federal Pipeline Safety Act in areas such as record keeping, pipeline integrity management and identification of pipeline threats.
PG&E Chairman and CEO Tony Earley, who was brought in to lead PG&E in 2011 after the San Bruno accident, said: "San Bruno was a tragic accident. We've taken accountability and are deeply sorry. We have worked hard to do the right thing for victims, their families and the community, and we will continue to do so. We want all of our customers and their families to know that nothing will distract us from our mission of transforming this 100-plus-year-old system into the safest and most reliable natural gas system in the country."
PG&E believes that its employees did not intentionally violate the federal Pipeline Safety Act, and that even where mistakes were made, employees were acting in good faith to provide customers with safe, reliable and affordable energy.
Progress since San Bruno Accident
Following the San Bruno accident, California adopted new pipeline safety standards that are among the most rigorous in the nation. PG&E is making excellent progress toward meeting or exceeding these new standards as well as toward completing implementation of recommendations by the National Transportation Safety Board.
Among the actions the company has taken are:
- Committed to spend $2.7 billion of shareholder money to fund safety-related work
- Completed nine of the 12 safety recommendations made by the National Transportation Safety Board; of the three remaining recommendations, the NTSB considers PG&E's progress "open-acceptable response," which means acceptable pending completion
- Opened a state-of-the art gas control center in August 2013
- Validated the maximum allowable operating pressure for all 6,750 miles of gas transmission pipelines
- Digitized more than 3.5 million paper records associated with transmission lines going back 50 years as part of a program to ensure the accuracy of all records and to provide field technicians with electronic access to them
- Strength-tested or validated prior strength testing for 657 miles of transmission pipeline
- Replaced 127 miles of pipeline
- Retrofitted 268 miles of pipeline to accommodate in-line inspections
Installed 134 automated valves on gas transmission pipelines In addition, PG&E made structural changes, separating the gas and electric businesses to ensure an appropriate focus on safety, and brought in a new management team to run the gas operations business.
The company has settled claims amounting to nearly $500 million with the victims and families of the San Bruno accident, established a $50 million trust for the City of San Bruno for costs related to recovery and contributed $70 million to support the city's and community's recovery efforts.
The 12-count indictment seeks penalties of $500,000 per count.
For additional information and ongoing updates on this issue, please visit www.PGEresponds.com.
Pacific Gas and Electric Company, a subsidiary of PG&E Corporation (NYSE:PCG), is one of the largest combined natural gas and electric utilities in the United States. Based in San Francisco, with more than 20,000 employees, the company delivers some of the nation's cleanest energy to 15 million people in Northern and Central California. For more information, visit www.pge.com/ and http://www.pge.com/about/newsroom/.
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