PG&E calls CPUC’s $2.25 Billion Fine Excessive

by Brian Leubitz

In 2010, one of PG&E’s main gas lines exploded, killing 8 people, and injuring many more. Since that time, we have discovered that PG&E hadn’t properly inspected the lines, and continued to resist the real work that was necessary to maintain system safety.

The CPUC has proposed that the company be fined $2.25 billion, with administrative law judges scheduled to rule on that soon. The Commission is rather fed up with PG&E at this point. Director of Consumer Safety Jack Hagan had this to say:

PG&E’s brief on penalties displays a chilling lack of remorse for the many failures that led up to the tragedy in San Bruno. I believe the lack of remorse by PG&E in its brief only serves to reinforce the need for the Commission to impose the very substantial $2.25 billion penalty I have proposed.

PG&E’s lack of remorse is particularly evident in the section of its brief entitled “Severity of the Offense.” Although PG&E commences that section of the brief with a statement of “regret” for the incident in San Bruno, the gist of PG&E’s argument is “don’t blame us.” … PG&E’s statements of “regret” ring hollow in the face of this continuing lack of any sincere remorse whatsoever for the Company’s past shortcomings. If there was ever any doubt about the need for a very large penalty in this case, any such doubt is removed by the unrepentant tone of PG&E’s brief. It is time to throw the book at PG&E(H/t to KCET)

Now, this “fine” is rather misleading. Even if they would be fined that large amount, the current proposal is for the money to be required to spend on safety improvements. And as a bonus, the company would get about $900 million back of that in tax benefits. Now, normally PG&E likes to charge customers for these kinds of expenses, but given that the system needs far more than $2.25 billion of safety improvements, this is hardly the end of the world for them. They can still try to recoup some of the other safety costs and the money really goes back on to their system.

You can read Hagan’s full reply brief here. We should get a decision on the fine by the end of the summer.

Photo credit: ABC7.