Senator Hill Introduces Bill Compelling CPUC to Fulfill Its Safety Mission

February 09, 2017

For Immediate Release – Office of State Senator Jerry Hill – February 9, 2017

Senator Jerry Hill Introduces Bill to the Compel California Public Utilities Commission
To Fulfill Its Safety Commitment as the State’s Utility Regulator

SB 273 Includes Requirement for CPUC Safety Assessments of Gas and Electric Utilities

SACRAMENTO – State Senator Jerry Hill introduced legislation today that compels the California Public Utilities Commission to fulfill its safety commitment as a utility regulator by laying out the agency’s safety oversight responsibilities -- and steps that must be taken in order to meet those expectations.

“More than six years after the PG&E pipeline explosion in San Bruno, the CPUC still struggles to deliver on its commitment and its duty to ensure the safety of California utilities,” said Hill, D-San Mateo and Santa Clara Counties.

“Devising a sound plan and stronger programs for safety would be a good start – but actually carrying out those plans and taking action on policy are essential as well,” Hill said. “Yet we don’t see that happening. The disasters and dangerous missteps that have persisted since the 2010 explosion in San Bruno are proof of that.”

Eight people died when a PG&E gas pipeline exploded in September 2010 in San Bruno and nearly leveled a neighborhood. Recent high-profile safety incidents include:

  • The destruction of a cottage in Monterey and damage to three nearby homes caused by faulty installation of a new PG&E gas pipeline in March 2014.
  • The Aliso Canyon gas leak in 2015, the worst natural gas leak in U.S. history, which occurred after the CPUC had been warned of well integrity problems at the site.
  • The sweeping 2015 Butte fire, the seventh most destructive fire in the state’s history, which was caused by a PG&E power line.
  • An outage that cut power to about 100,000 customers in Southern California and caused gas flares at a refinery, forcing nearby residents to shelter in place – all as a result of incorrect wiring at a substation in October 2016.

To address the gaps in safety management and oversight, SB 273:

  • Requires the CPUC to conduct safety management assessments of gas and electric utilities at least every five years.
  • Requires each of the five commissioners to be assigned a CPUC engineer, who would advise the commissioner on technical matters, including safety. The move provides commissioners with an immediate human resource on complex, technical issues. The change also would help commissioners develop their knowledge in these areas while signaling the importance of direct technical and safety expertise.
  • Specifies that it is the CPUC’s responsibility to implement up-to-date safety management practices and outlines the responsibilities of safety units within the CPUC.
  • Requires the CPUC to hire an outside consultant to audit the CPUC’s internal communications regarding safety, the agency’s decision-making processes as they relate to safety, and whether the importance of safety is reinforced through recognition programs, career development opportunities and other means. A CPUC “safety culture report,” leaked in 2013, said CPUC staff did not believe that management truly considered safety a priority, but merely the “flavor of the month” for work issues.
  • Prohibits the CPUC from impeding safety when drawing up rules and regulations for utilities. For example, the CPUC last fall lifted the requirement for utilities to report whether safety violations involving gas pipelines have occurred. Utilities had called for the change.

Safety and risk experts have urged that the CPUC periodically conduct rigorous assessments of utilities’ safety management and practices in order to scrutinize human and organizational elements that affect safety, and not just infrastructure weaknesses and failures. The experts also recommend that such assessments are conducted as a part of a continuous, comprehensive effort to improve utility safety - rather than as an occasional examination that occurs largely in the context of requests for rate increases, as is now the case.

The experts also noted organizational issues that have impeded efforts to embed safety in CPUC operations.

Edward O’Neill, Governor Brown’s senior advisor on CPUC modernization and reform, compared issues with internal communication at the CPUC to those at NASA leading to the deeply flawed decisions that resulted in the ill-fated launch of the Space Shuttle Challenger in 1986. “I am convinced that somewhat similar communication deficiencies and flaws in information flow exist at the CPUC,” O’Neill wrote in a 2015 report.

Professors Karlene Roberts and Paul Schulman, writing for the Center for Catastrophic Risk Management at UC Berkeley, said in a 2016 report: “One striking finding we discovered in our interviews is that there doesn’t seem to be a clear conception or definition of safety shared throughout the Commission or across divisions or even across branches within the SED [Safety and Enforcement Division]. We have heard the call for ‘more safety’ but it’s not clear that there’s an underlying understanding of what that means.”

Roberts and Schulman also wrote: “It is not clear to us that at present either Commission managers or staff see major institutional incentives attached to roles closely connected with safety…It is important the CPUC recognize, encourage and support the role of ‘safety professional’ as part of the professionalism of its managers and staff.”

The CPUC’s 2017 Safety Action Plan, which will be discussed by the CPUC in a meeting that begins at 9:30 a.m. on Thursday, fails to address the criticisms raised by the three experts. For example, one provision of the plan states that the CPUC does not intend to take another full examination of its gas and electric safety rules until 2027.

“A gap of a decade is unacceptable,” said Senator Hill. “The dangerous incidents that have occurred recently across a span of barely three years point to the flaws of such a timeline.”

SB 273 follows a letter Senator Hill wrote to commissioners this past November to urge them to focus on the oversight of safety management by utilities and to hone CPUC’s communications within the agency on the importance of safety. He also urged commissioners -- when they take up complex technical issues and matters related to safety -- to tap CPUC engineers and other employees who have firsthand experience in these areas so that considerations and ultimately decisions are informed by their knowledge and direct experiences.

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Resources:

SB 273:
http://sd13.senate.ca.gov/sites/sd13.senate.ca.gov/files/PUCSafety_InitialBillText.pdf

Senator Hill’s November 2016 Letter to CPUC Commissioners
http://sd13.senate.ca.gov/sites/sd13.senate.ca.gov/files/11-10-16_HilltoPUC_RE_OSA.pdf

June 2015 report by Edward O’Neill
https://www.opr.ca.gov/docs/062215_Key_Findings_Mod__Reform_Project_.pdf

February 2016 report by Professors Karlene Roberts and Paul Schulman,
Center for Catastrophic Risk Management at UC Berkeley:
http://www.cpuc.ca.gov/uploadedFiles/CPUC_Public_Website/Content/Transparency/Commissioner_Meetings/CPUC%20SMS%20Report%20Presentation%20and%20Report.pdf

CPUC 2017 Safety Action Plan Update:
http://www.cpuc.ca.gov/uploadedFiles/CPUCWebsite/Content/Safety/Other/2017_Safety_Action_Plan.pdf

Media Contact: Leslie Guevarra, 415-298-3404 cell, leslie.guevarra@sen.ca.gov