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Did PG&E Delay Pipeline Fix To Spend Money on Prop 16?

by: Robert Cruickshank

Thu Sep 16, 2010 at 10:30:00 AM PDT

The SF Chronicle reports that PG&E planned to fix part of the pipeline that exploded in San Bruno - but last year delayed the fix to spend the money elsewhere. The big question is, did that delay happen so PG&E could spend $46 million to try and undermine local democracy in their attempt to pass Prop 16?

Pacific Gas and Electric Co. asked state regulators three years ago for permission to spend $4.87 million to replace a portion of the same natural gas pipeline that ruptured last week and set a San Bruno neighborhood on fire....

Neither project has come to fruition. The South San Francisco project was moved down the priority list and the money spent elsewhere, and the southern project is still pending approval from state regulators. And now some observers wonder if the utility missed a chance to spot flaws in the pipeline that could have contributed to the Sept. 9 explosion, which killed four people, left three missing and destroyed 37 homes.

As the article explains, PG&E's deferred maintenance policies are nothing new:

In one infamous case, a 1998 report from the California Public Utilities Commission found that the utility had taken $77.6 million that was supposed to be spent trimming trees near power lines - a vital step in wildfire prevention - and used it to boost corporate profits instead.

So what might have PG&E wanted to do with its money instead of repairing a pipeline that was known to be among the most dangerous in the country, desperately in need of repair?

Well, it was in late 2009 when PG&E leadership decided to spend millions of dollars to pass Prop 16, which would limit local democracy in order to preserve PG&E's monopoly. PG&E executives warned shareholders to expect a loss in 2010 because of spending on Prop 16, which would indicate that it may well have been a factor in PG&E's decision to defer maintenance on the pipeline that later exploded.

Once again, as I explained recently, this shows why we should not leave important infrastructure like this in the hands of private corporations. It needs to be publicly owned and operated to be effective and safe, because corporations will always have the incentive to spend to protect their profits and their market position instead of provide safe services to the public.

Robert Cruickshank :: Did PG&E Delay Pipeline Fix To Spend Money on Prop 16?
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Another part of the article you should have quoted (0.00 / 0)
The work was included in a list of projects that PG&E submitted to the California Public Utilities Commission  to justify a rate-hike request related to natural gas transmission and storage. The commission approved the request, and the project's price became part of the rates that PG&E customers pay.

They did this twice -- justify rate increases for work they didn't do, and that failure to perform the work resulted in the deaths of at least four people.

In my book, that's murder.

That the work hasn't been done (0.00 / 0)
That's terrible, and should be dealt with.

But there's no evidence that either of those projects - both miles away - would have had any opportunity to correct whatever problem it was we had that caused the explosion.

Indeed, had the work been done, there would be sensationalistic articles implying that the replacement pipe 3 miles away was obviously done shoddily and thus the cause.

Your neighbor won't find your leaky pipes when he fixes his.

Fry, don't be a hero! It's not covered by our health plan!

[ Parent ]
It was one project, PG&E wants us to pay for twice (0.00 / 0)

For clarification, it isn't 2 projects. It was one project that PG&E sought & received approval to pay for with customer money in 2007, then didn't do any work on, then asked to do again in 2009. 

PG&E doesn't state the justification for the double-charge/duplicate submission, but they filed paperwork for the exact same section of pipeline in their latest attempt to raise rates. We (TURN) made both filings available for download at http://turn.org/workpapers

Not doing the work is allowed within the regulatory framework, but it's alarming since the newer document states that the section of pipeline the requested funding to work on had an "unacceptably high risk of failure," whereas the original filing said the work was to "lower the risk" associated with an older pipeline in a highly populated area. Did the pipeline get worse, or did the filings just have different authors? Why have they delayed work that's already been paid for on pipeline at a "high risk of failure?"

It's not unfair to say that if they had done the work they might have been blamed, but it's also not unreasonable to say that if they had done the work they said they were going to do they may have been alerted to the problem nearby.

The bottom line is that PG&E is not doing the maintenance we pay them for and PG&E is not being forthright about the work they're deferring. As both Robert and the Chronicle point out, PG&E has a habit of forgoing maintenance to line their own pockets, and once again PG&E has put its own profits before public safety.

[ Parent ]
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