CPUC Penalizes PG&E $1.6 Billion for Pipeline Violations

The California Public Utilities Commission (CPUC) imposed the largest penalty it has ever assessed by ordering Pacific Gas and Electric (PG&E) shareholders to pay $1.6 billion for the unsafe operation of its gas transmission system, including the pipeline rupture in San Bruno, Calif., in 2010. The decision orders PG&E to pay $850 million in gas transmission pipeline safety infrastructure improvements, most of which will be spent on capital investments that PG&E will not add to its rate base and thus will not earn any profit on; $300 million in a fine to the state's General Fund; $400 million in a one-time bill credit spread across PG&E's gas customers; and approximately $50 million towards other remedies to enhance pipeline safety. When added to the disallowances already adopted in a prior CPUC Decision, the penalties and remedies exceed $2.2 billion.