VI. THE SCOPE OF THIS ENFORCEMENT PROCEEDING
This investigation will focus on PG&E's past actions and omissions, to determine whether PG&E has violated laws requiring safe utility gas system practices. The Commission has the broad authority to impose fines and other remedies if such violations are proven.
The Commission understands that CPSD staff's investigation of the San Bruno pipeline rupture, although substantially complete, is still ongoing, and that staff in the course of the investigation may identify additional areas of concern. If staff later believes it has good cause to assert additional violations beyond those described herein and in CPSD's Report, staff may bring the matter to the Commission's attention in this docket, and request that it be included in this investigation, or if a good reason exists for it, by commencement of a separate enforcement proceeding.
In a separate rulemaking (R.11-02-019) the Commission is analyzing a "new model of natural gas pipeline safety regulation applicable to all California pipelines." However, future safety rules are not the focus of this investigation. Rather, this is an enforcement proceeding to ascertain whether safety violations have occurred, and if so to impose fines and remedies.
We emphasize that the Commission's remedial powers are not limited to its authority to impose civil penalties. Pursuant to Public Utilities Code Section 761, if the Commission finds that PG&E's maintenance or operations practices were unsafe, unreasonable, improper, or insufficient, we may consider ordering PG&E to change or improve its maintenance, operations, or construction standards for gas pipelines, in order to ensure system-wide safety and reliability. We place PG&E on notice that the Commission may consider ordering PG&E to implement the recommendations made in CPSD's Report, in order to improve and ensure system-wide safety and reliability.
Rule 1.1 of the Commission's Rules of Practice and Procedure require utilities to provide complete and non-misleading answers to the Commission and its staff. We place PG&E on notice that, should staff raise additional allegations regarding PG&E's cooperation with discovery requests in this proceeding, we will consider those allegations pursuant to Rule 1.1.
The scope of this proceeding will also include PG&E's compliance with the Orders and Resolutions issued by us to PG&E since the date of the San Bruno incident. If Staff discovers any violations or lack of cooperation with our recent decisions and rulings, we expect those allegations to be brought to our attention in this proceeding.
Further, PG&E has committed to reimburse the Commission for its costs incurred in investigating the causes of the San Bruno rupture and for the costs of any other Commission investigation that stems from it.9 PG&E will bear this cost out of shareholder profits; the costs will not be borne by PG&E ratepayers, in light of the magnitude of the tragedy that occurred in San Bruno.
Finally, we place PG&E on notice that the Commission will decide in a separate proceeding whether PG&E ratepayers or shareholders, or both, will pay for PG&E testing, pipe replacement, or other costs. Some costs may stem from the San Bruno pipe rupture or from recordkeeping deficiencies, both of which could be significant. We also place PG&E on notice that in the rulemaking the Commission may take note of the record evidence in this investigation.
Therefore, IT IS ORDERED that:
1. An investigation is instituted on the Commission's own motion to determine whether Respondent PG&E violated any provision of the Public Utilities Code or our general orders, statutes, resolutions, directives, requirements (including federal gas safety requirements), or applicable industry safety standards in connection with the San Bruno explosion and fire on September 9, 2010. We will also evaluate whether PG&E's actions after the incident have comported with Rule 1.1 of the Commission's Rules of Practice and Procedure and the numerous Orders and Resolutions we have issued to PG&E.
2. PG&E is named as Respondent to this investigation.
3. CPSD is hereby named as a party to this proceeding.
4. PG&E is hereby given notice that fines may be imposed in this matter pursuant to Public Utilities Code Sections 2107 and 2108.
5. PG&E is hereby given notice that the Commission may order the implementation of operational and policy measures designed to prevent future gas hazards to safety pursuant to Public Utilities Code Section 761.
6. Pursuant to Rule 7.1(c) of the Commission's Rules of Practice and Procedure, this proceeding is categorized as adjudicatory. Ex Parte communications are prohibited. The categorization of this Order is appealable under Rule 7.6.
7. Pursuant to Rule 7.3, this Order constitutes a preliminary scoping memo. The issues of this proceeding are framed in the above order. These issues will be heard in this proceeding without prejudice to any related proceedings.
8. A prehearing conference shall be convened before an Administrative Law Judge for the purpose of establishing a schedule in this matter including the date, time, and location of an evidentiary hearing, and for good cause shown the ALJ and/or Assigned Commissioner may extend the deadlines specified herein, for any particular responses required.
9. To facilitate the completion of this investigation, and consistent with the provisions of P.U. Code Section 314, staff shall continue discovery and continue to investigate the operations of Respondents. Any additional information that Staff wishes to introduce shall be provided to the Respondents in advance of any hearings in accordance with the schedule directed by the assigned Administrative Law Judge. PG&E shall cooperate fully with staff's inquiries and preserve all records as required by prior Commission orders. Staff need only respond to discovery requests after completion of its direct testimony to allow staff to complete its investigation. Such requests shall be limited to Staff's investigation of the Respondents and Staff's prepared testimony offered in this proceeding.
10. Pursuant to Rule 13.9 of the Commission's Rules of Practice and Procedure, we take official notice of the NTSB Report issued August 30, 2011, entitled "NTSB/PAR-11/01 PB2011-916501". A copy will be made an exhibit in this proceeding.
11. Pursuant to Rule 13.9 of the Commission's Rules of Practice and Procedure, we take official notice of the IRP Report issued June 24, 2011, entitled "Report of the Independent Review Panel - San Bruno Explosion". A copy will be made an exhibit in this proceeding.
12. A copy of CPSD's Report is issued today herewith, entitled "CPSD Incident Investigation Report into the September 9, 2010, PG&E Pipeline Rupture in San Bruno, California", and will be made an exhibit in this proceeding.
13. We expect Staff to bring additional evidence discovered in the course of its ongoing investigation of any new alleged violations by Respondents to our attention. Staff may propose to amend the OII to add additional allegations or to raise additional charges. Any such proposal shall be presented to the ALJ in the form of a motion to amend the OII and shall be supported by a Staff report supporting the proposed amendments.
14. The Executive Director shall cause a copy of this Order to be served by certified mail on Respondent Pacific Gas and Electric Company:
Christopher P. Johns, President Pacific Gas and Electric Company 77 Beale Street San Francisco, CA 94105 |
Brian K. Cherry Vice President, Regulatory Relations Pacific Gas and Electric Company 77 Beale Street, Room 1087 San Francisco, CA 94105 |
Lise H. Jordan, Law Department Pacific Gas and Electric Company 77 Beale Street San Francisco, CA 94105 |
Pacific Gas and Electric Company 77 Beale Street, # 100 San Francisco, CA 94105 Attention: Agent for Service of Process |
This order is effective today.
Dated January 12, 2012, at San Francisco, California.
MICHAEL R. PEEVEY
President
TIMOTHY ALAN SIMON
MICHEL PETER FLORIO
CATHERINE J.K. SANDOVAL
MARK J. FERRON
Commissioners
CPSD Staff Report on San Bruno Explosion OII
9 http://www.cpuc.ca.gov/NR/rdonlyres/17D6C1C6-6704-453D-8C8C-8BA7D1464F9D/0/PGEAgreementCPUC031111.pdf.
