SAN FRANCISCO – A federal grand jury returned a superseding indictment charging Pacific Gas and Electric Co with lying and obstructing a federal investigation that began after the deadly 2010 San Bruno gas explosion, officials said Wednesday.
The new charges expose Pacific Gas and Electric to more than $1 billion in fines.
Pacific Gas and Electric is scheduled to be in court on Aug. 18.
The indictment spells out how Pacific Gas and Electric lied and obstructed the National Transportation Safety Board’s investigation:
- During the course of the Transportation Safety Board’s investigation, PG&E provided a version of a policy outlining the way in which Pacific Gas and Electric addressed manufacturing threats on its pipelines.
- Pacific Gas and Electric later withdrew that policy claiming it was produced in error, and was an unapproved draft.
- In fact, Pacific Gas and Electric was operating under the so-called unapproved draft from 2009 through April 5, 2011.
- The consequence of this practice was that Pacific Gas and Electric did not prioritize as high-risk, and properly assess, many of its oldest natural gas pipelines, which ran through urban and residential areas.
Additionally, the superseding indictment charges Pacific Gas and Electric with 27 counts of knowingly and willfully violating the violations of the Natural Gas Pipeline Safety Act of 1968.
The utility announced in June that it was expecting the new indictment. Pacific Gas and Electric spokesman Greg Snapper said company officials had not yet seen it, according to CBS News in San Francisco.
“However, based on all of the evidence we have seen to date, we do not believe that the charges are warranted and that, even where mistakes were made, employees were acting in good faith to provide customers with safe and reliable energy,” he said in a prepared statement.
In addition, CBS News reported that the utility is facing lawsuits and $2.5 billion in civil fines from regulators, including the state Public Utilities Commission. San Bruno city officials on Monday demanded the head of the PUC resign, alleging the agency had improper contacts with Pacific Gas and Electric.
Along with causing the deaths, the explosion injured dozens and destroyed 38 homes. Nearly four years later, the neighborhood about 12 miles south of San Francisco is still recovering, according to the CBS report.
“What the U.S. prosecutor is saying is that Pacific Gas and Electric did not use the proper procedure under the law for evaluating the integrity of their pipelines,” San Bruno City Manager Connie Jackson told CBS. “On top of that, they represented to NTSB that the procedure they were using was correct and approved” when it wasn’t.
These charges stem from Pacific Gas and Electric record keeping and pipeline “integrity management” practices. The superseding indictment alleges that Pacific Gas and Electric failed to address record-keeping deficiencies concerning its larger natural gas pipelines knowing that their records were inaccurate or incomplete.
The superseding indictment also alleges that Pacific Gas and Electric failed to identify threats to its larger natural gas pipelines and that PG&E did not take appropriate actions to investigate the seriousness of threats to pipelines when they were identified.
Also the superseding indictment alleges that PG&E failed to adequately reprioritize and assess threatened pipelines after the pipelines were over pressurized as required by the PSA and its regulations.
Pacific Gas and Electric is charged with one count of obstruction of an agency proceeding in violation federal gas pipeline safety laws and 27 separate counts of violations of the safety law.
The maximum penalty for each count is a $500,000 fine or a fine based on twice the gross gain of $281 million that Pacific Gas and Electric made as a result of the violations, or twice the losses suffered by the victims. according to the indictment.
The superseding indictment alleges that victims suffered losses of approximately $565 million.