PG&E Fined $5.4M For Using Non-Qualified Contractors On Inspections

SAN FRANCISCO (CBS SF) — The California Public Utilities Commission Friday issued a $5.45 million fine and citation to San Francisco-based PG&E for using non-qualified contractors to perform certain pipeline corrosion inspections.

The fine came after the CPUC’s safety and enforcement division in February learned of a PG&E contractor who had previously performed atmospheric corrosion inspections on natural gas lines without the required qualifications.

The state regulator said in a news release that those inspections, where portions of pipeline that are exposed to air are investigated for corrosion, are “of utmost importance for safe pipeline operations.”

PG&E in September filed a report with the CPUC saying that there had been 101 non-qualified contractors doing about a half-million inspections in seven areas of the utility’s system between February and November of 2014.

According to the citation issued Friday, CPUC staff then audited PG&E’s atmospheric corrosion inspection program and determined that the utility failed to properly train and qualify its contractors, as well as failing to verify their qualifications.

The CPUC issued a penalty of $50,000 for each of the 101 non-qualified contractors, totaling $5.05 million, and also issued a $350,000 penalty for failing to complete valid inspections of atmospheric corrosion within 39 months of the previous inspection.

The state regulator added another $50,000 penalty, noting PG&E learned of the qualification deficiency in 2015 and early 2016 but did not self-report the problem until September.

PG&E is performing re-inspections of the system and said they will complete them by mid-2017, according to the CPUC.

The utility, which was not immediately available to comment, has 30 days to pay or contest the citation.

The CPUC has a whistleblower program for anonymous reporting of violations. People can call (800) 649-7570, email safetyhotline@cpuc.ca.gov or visit https://ia.cpuc.ca.gov/whblow/ to submit complaints.

TM and © Copyright 2016 CBS Radio Inc. and its relevant subsidiaries. CBS RADIO and EYE Logo TM and Copyright 2016 CBS Broadcasting Inc. Used under license. All Rights Reserved. This material may not be published, broadcast, rewritten, or redistributed. Bay City News Service contributed to this report.

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