Who should pay for the San Bruno blast aftermath?
According to a document PG&E filed with state regulators late last month, its customers should be on the hook for 90 percent of the cost to make its pipeline system safer.
The San Bruno disaster uncovered a host of costly problems in PG&E’s system: hundreds of miles of pipelines that must be tested or replaced — at a cost of $1.3 billion. Dreadfully disorganized records about its own system — a problem that will cost $285 million to fix. And an outdated safety-valve system that must be upgraded to be automatic or remotely controlled — to the tune of $144 million.
In total, PG&E estimates the necessary improvements to its system will cost about $2.2 billion through 2014 — and that’s just phase one of its safety improvement plan. The proposal must still be approved by the California Public Utilities Commission.
PG&E officials said the pipeline modernization plan would make the utility an industry leader for safety and would only increase the gas bill at most customers’ homes by about 4 percent. Businesses and some other customers would see more substantial hikes.
But the suggestion that customers should pick up the bill for this has consumer advocates fuming. They say PG&E should have been maintaining its pipelines properly all along.
“PG&E needs to pay,” said Mark Toney, executive director of The Utility Reform Network. “This stuff is their fault, their negligence, their lack of record-keeping. That needs to be 100 percent PG&E.”
PG&E has a history of charging customers multiple times for the same projects.
A San Francisco Examiner analysis of rate-hike documents in November showed that PG&E customers had been charged multiple times for at least two dozen natural-gas improvement projects that had not yet been implemented. Customers were asked to pay more than $320 million for the projects in 2008, and then were asked to pay another $313 million for those same projects in 2011.
Since then, state regulators have demanded explanation for such double charges. And ultimately, state regulators will decide how much of the pipeline-upgrade costs will come out of PG&E’s customers’ pocketbooks.