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 or visit to submit complaints.

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