A state lawmaker on Monday pressured the California Public Utilities Commission to reject a proposal by PG&E to increase rates for customers in order to pay for pipeline safety improvements.
Assemblyman Jerry Hill, whose district includes the San Bruno neighborhood where a 2010 gas pipeline blast killed eight people and destroyed dozens of homes, called on the CPUC to make a ruling on a fine that would hold PG&E responsible for the blast instead of passing on costs to customers.
“Because of the neglect we’ve seen from PG&E, now we’re stuck with the cost to replace” pipelines, Hill said. “We’re not going to stand for it.”
In August 2011, the National Transportation Safety Board said PG&E had several chances to avoid the San Bruno disaster, but ignored each opportunity. Investigators even blamed PG&E for the explosion, claiming the company “exploited weaknesses in a lax system of oversight and government agencies that placed a blind trust in operators to the detriment of public safety.”
That same month, PG&E laid out a plan to replace and maintain the aging pipelines identified in the NTSB report. That plan had ratepayers covering 95 percent of costs, Hill said.
Then in January 2012, the CPUC also found the utility at fault for the explosion, stating that PG&E “emphasized profits over safety.” That finding opened a penalty consideration case.
However, a penalty ruling has not been made. The CPUC did fine PG&E $38 million for a 2008 explosion in a Sacramento suburb, more than two years after that disaster.
“We think two years is a long time to waste and people are expecting a ruling,” said Mark Toney, executive director of The Utility Reform Network.
The first phase of the proposed pipeline safety improvements calls for $2.2 billion to improve and maintain aging pipelines, but most of it will be paid for by customers, Hill said. If the plan is approved, Hill said, PG&E stands to make a $1.7 billion profit over the next 45 years.
“The PUC should not allow PG&E to force its customers to pick up the tab for work resulting in decades of neglect,” he said.
PG&E spokeswoman Brittany Chord said the requested increase only amounts to $2 per household and will help the company reach its goals of improving pipeline safety.
“We know we have a lot of work to do to make our systems safer for our customers,” Chord said “We’ve been out since 2010 taking aggressive action to make our systems safer for customers.”
Also on Monday, Hill introduced Assembly Bill 861, which would “ensure utilities don’t cut corners on safety and maintenance in order to convert ratepayer dollars into bonuses for executives,” he said.