Welcome to the March 2011 edition of the California Public Utilities Commission's (CPUC) eNewsletter, where you'll find information on CPUC enforcement activities, new gas pipeline rules, and more.


CPUC Commissioner Florio Embarks On Listening Tour

Newly appointed CPUC Commissioner Mike Florio has kicked off a “California Listening Tour,” meeting with customers in San Francisco, the South County Economic Development Council in Chula Vista, and the Western Power Trading Forum in San Diego.

On February 16, 2011, Commissioner Florio joined The Utility Reform Network for a forum on the California LifeLine Program, which provides discounted basic telephone services to eligible low income California households. Customers reminded Commissioner Florio they depend on LifeLine for basic telephone service at a consistent, low cost.

On February 17, 2011, the South County Economic Development Council welcomed Commissioner Florio to Chula Vista. The Council’s members, including local elected representatives, business, and non-profit leaders, encouraged the Commissioner to consider new ways to support clean energy generation and energy efficiency, greater diversity in utility contracting, expanded broadband adoption, and increased support of underground electricity distribution lines. Commissioner Florio applauded the community's successful campaign to decommission the South Bay power plant and joins Chula Vista in urging a timely deconstruction of the facility.

On February 18, 2011, Commissioner Florio joined the Western Power Trading Forum’s annual meeting. Commissioner Florio shared his vision for the CPUC, including a renewed dedication to safe service, reasonable rates, and effective utility oversight. Western Power Trading Forum members suggested that California's ratepayers will benefit from more merchant ownership of electric generation, transmission, and distribution infrastructure.

Commissioner Florio’s California Listening Tour will continue through April.

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CPUC Begins Penalty Consideration Regarding PG&E Gas Pipeline Recordkeeping

The CPUC has entered a penalty consideration phase into whether Pacific Gas and Electric Company’s (PG&E) gas transmission pipeline recordkeeping was unsafe, whether it violated the law, and if so whether deficient PG&E recordkeeping caused or contributed to the pipeline rupture in San Bruno on Sept. 9, 2010.

The CPUC said it is commencing a penalty consideration phase because it must be assured that PG&E has accurate and up-to-date knowledge of critical aspects of its gas transmission pipeline system.

This CPUC began examining PG&E’s recordkeeping immediately after the San Bruno explosion. The National Transportation Safety Board (NTSB) issued a Safety Recommendation on January 3, 2011, after it determined that after the rupture PG&E had incorrectly identified the San Bruno pipe as seamless, when in fact the pipe was seamed and welded pipe. The CPUC immediately directed PG&E to undertake the Safety Recommendations made by the NTSB and conduct a complete and comprehensive records search of pipeline documents in order to determine the valid Maximum Allowable Operating Pressure based on the weakest section of the pipeline or component to ensure safe operation of PG&E's pipelines. The CPUC determined today that the NTSB’s reports have presented sufficient information and good cause to commence a penalty consideration phase into PG&E's recordkeeping.

During the penalty consideration phase, an Administrative Law Judge (ALJ) will be assigned to the case and will hear testimony related to the safety and lawfulness of PG&E's recordkeeping for the San Bruno transmission pipeline and for other PG&E transmission pipelines. Based on the record that will be developed, the ALJ will prepare a Proposed Decision for consideration by the CPUC’s Commissioners, which could include statutory fines and penalties against PG&E, if warranted, of up to $20,000 per each day of a continuing violation of law.

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CPUC To Set New Rules For Safe, Reliable Operation Of State's Natural Gas Pipelines

The CPUC will set new rules for the safe and reliable operation of natural gas pipelines in California. Through a proceeding opened Feb. 24, 2011, the CPUC will obtain public input, and collect and analyze the data and conclusions from the investigations and reports of the Sept. 9, 2010, Pacific Gas and Electric Company (PG&E) pipeline rupture in San Bruno. Recommendations from the Independent Review Panel investigating the accident will be presented, considered, and implemented via this Rulemaking.

The Rulemaking’s primary objectives are to:

A. Provide the public with a means to make their views known to the CPUC.

B. Provide the public with the Independent Review Panel's expert recommendations.

C. Develop and adopt safety related changes to the CPUC’s regulation of natural gas transmission pipelines, including requirements for construction, especially shut-off values, maintenance, inspections, operation, record retention, ratemaking, and the application of penalties.

D. Consider ways that the CPUC can undertake a comprehensive risk assessment for all natural gas pipelines regulated by the CPUC, and possibly for other industries that the CPUC regulates.

E. Consider available options for the CPUC to better align ratemaking policies, practices, and incentives to elevate safety considerations, and maintain utility management focus on the “nuts and bolts” details of prudent utility operations.

F. Consider the appropriate balance between the CPUC's obligation to conduct its proceedings in a manner open to the public with the legitimate public safety concerns that arise from unlimited availability of certain utility information.

G. Consider if further rules or other protection is needed for whistleblowers to inform the CPUC of safety hazards.

H. Expand emergency and disaster planning coordination with local officials.

To accept public comment on its regulation of natural gas transmission and distribution pipelines, the CPUC will hold a Public Participation Hearing in San Bruno on April 5, 2011, from 5 p.m. to 10 p.m. at the Senior Center, 1555 Crystal Springs Rd., San Bruno. The CPUC will also hold Public Participation Hearings in another Northern California location and in Los Angeles. Dates, times, and locations will be released in the coming days.

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CPUC Begins Penalty Consideration Regarding Muni Safety Issues

The CPUC has began penalty considerations based on CPUC staff allegations of pervasive safety concerns regarding the San Francisco Municipal Transportation Agency’s (SFMTA or Muni) light rail system. This action was taken after CPUC safety inspectors found numerous safety violations on Muni's light rail system in San Francisco. In their report to the CPUC, the inspectors have alleged that SFMTA has been chronically unresponsive to alleged violations and other findings.

The CPUC has exclusive jurisdiction over rail transit safety in California. The CPUC’s Consumer Protection and Safety Division (CPSD) staff conduct regular inspections of SFMTA’s light rail system. CPUC staff have become increasingly concerned with public safety issues throughout the Muni system. In particular, CPUC staff are concerned with the material condition of the light rail system, SFMTA’s failure to initiate or complete Corrective Action Plans to address known problems, late reporting or non-reporting of incidents, and failure to respond to CPUC staff inspection findings. These preliminary findings, if proven, may violate state and federal regulations, violate SFMTA’s own internal regulations, and raise serious safety concerns for the public as well as SFMTA employees.

In the penalty consideration proceeding an Administrative Law Judge (ALJ) will hear testimony on safety concerns regarding the SFMTA light rail system. Based on the record that will be developed, the ALJ will prepare a Proposed Decision for consideration by the CPUC’s Commissioners, which could include fines and penalties against SFMTA, if warranted.

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Visit our Consumer Information Center for more assistance. Consumers with utility complaints can call our Consumer Affairs Branch at 1-800-649-7570.

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