Mega-Utility Dodges $500M 'Bullet' as Feds Slash Potential Fine for Pipeline Explosion

A federal judge on Tuesday night quietly slashed a potential $562 million fine against Pacific Gas & Electric Co. (PG&E) for the privately owned, publicly regulated utility’s role in a 2010 deadly natural gas pipeline explosion near San Francisco.

The incident six years ago “sent a giant plume of fire into the air, killing eight people and destroying 38 homes in the San Francisco Bay Area city of San Bruno,” the Associated Press recalls.

As Common Dreams noted at the time, “In the weeks before the catastrophe, residents had been reporting gas odors and had voiced fears about a leak. But this brought no action from the company. A state assemblyman from the San Bruno area noted that the torn pipeline was over 60 years old, having been installed in 1948. He criticized PG&E for its poor maintenance and lax response. After the explosion, it took the company almost three hours to shut off the gas supply.”

SFGate explained on Tuesday:

But on Tuesday, “abruptly and without explanation”—and while the jury was still deliberating—federal prosecutors “walked away” from the hefty fine and U.S. District Judge Thelton Henderson signed off just hours later. 

Now, the maximum fine would be $500,000 per conviction, or $6 million for all 12 counts—11 felony violations of laws that require gas pipeline operators to inspect their lines closely for potential risks, and one count of obstructing the federal investigation of the explosion. Six million is approximately one percent of 562 million.

“PG&E Corp. just dodged another bullet,” wrote Bloomberg, which also noted that a $6 million fine “would be less than half a percent of the $1.5 billion profit PG&E recorded last year.”