SAN FRANCISCO (AP) — California regulators launched a top-level legal investigation Thursday into whether Pacific Gas & Electric Co. broke any laws in the deadly San Bruno pipeline explosion, a process that ultimately could end in hefty fines for the company.
All five commissioners of the California Public Utilities Commission voted unanimously to open the penalty case after agency staff issued a scathing report saying the natural gas line blew up in part due to what they called the systematic failures of PG&E's corporate culture, which emphasized profits over safety.
The blast on Sept. 9, 2010, killed eight people, injured dozens and sparked a fireball that torched 38 homes in a quiet neighborhood overlooking San Francisco Bay.
Staff also cited the utility's woeful record-keeping, haphazard emergency response and failure to follow both federal pipeline safety laws and accepted industry practices in their report, highlights of which were presented at the commission's public meeting.
"I pledge my very best effort to get to the bottom of this, and to impose very significant penalties on PG&E if staff's allegations of wrongdoing by PG&E are proven on the record," said Commissioner Mark Ferron. "We owe this debt to the good people of San Bruno."
An administrative law judge will hold a prehearing conference to set up a timetable for the case, which comes on the heels of two smaller legal probes by the commission.
PG&E President Chris Johns said the company will cooperate with the investigation.
"We are taking their findings very seriously," Johns said in a statement. "It is clear that PG&E's past gas operations practices were not what they should have been. We have admitted these shortcomings, and we are committed to raising the level of pipeline safety to new, higher standards."
The report took issue with the company's decision to cut back on gas line maintenance and improvement in recent years while simultaneously awarding company executives millions in bonuses.
"Although the CEO affirmed that PG&E will 'continue to focus' on safety and integrity of pipeline operations, our audit demonstrates that PG&E has under-spent the amount the Commission has authorized for natural gas transmission operations and maintenance in all but one of the past 14 years," the report said.
Last year, federal investigators from the National Transportation Safety Board who also looked into the blast found that a "litany of failures" by PG&E led to the explosion. They warned there was no certainty that those problems didn't exist elsewhere.
The board made a series of safety recommendations to regulators and the gas industry, concluding the accident wasn't the result of a simple mechanical failure, but was an "organizational accident."
U.S. Rep. Jackie Speier, a Democrat whose district includes San Bruno, said the new report underscored longstanding concerns about PG&E's management failures.
"Today's audit is yet more damning proof about how deaths, injuries and property damage might have been avoided if PG&E had followed through on its initial plan to replace all of Line 132 in San Bruno," she said. "It is truly unconscionable that PG&E was allowed by the CPUC to steal ratepayer monies that should have been spent on safety and, instead, was put in the pockets of PG&E shareholders."
Separately, the commission fined PG&E $100,000 for failing to comply with environmental mitigation measures when it built a substation in Bakersfield. It ordered the company to donate $50,000 to a program to help recover endangered species at California State University, Stanislaus.