trending Market Intelligence /marketintelligence/en/news-insights/trending/kwvkzlbajdohjwc9pot9mw2 content esgSubNav
In This List

Ky. commission issues highest gas safety fine to Louisville Gas and Electric


Japan M&A By the Numbers: Q4 2023


See the Big Picture: Energy Transition in 2024


IR in Focus | Episode 10: Capital Markets Outlook


Infographic: The Big Picture 2024 – Energy Transition Outlook

Ky. commission issues highest gas safety fine to Louisville Gas and Electric

After a pipeline rupture on Louisville Gas and Electric Co.'s system, the utility will have to pay the highest penalty the Kentucky Public Service Commission has ever issued for a natural gas safety incident.

The Kentucky PSC found that Louisville Gas and Electric, or LG&E, had committed a series of safety violations leading up to a 2014 pipeline rupture in Goshen, Ky., that injured two people and caused $52,000 in property damage, in addition to damages and costs for the utility.

The commission investigation concluded that not only were there physical problems with the pipe installation, but the company had not properly inspected the segment and had also been operating the line at a pressure above the section's maximum pressure. Altogether, the issues represented six different rule violations, and the commission fined LG&E $395,000.

LG&E had not correctly installed a coupling between two 12-inch sections of pipe 16 years before the line ruptured, and the improper connection could not withstand the pressure at which the line was being operated, the PSC found. The coupling only survived as long as it did because the soil surrounding the pipeline was holding it together, and the section burst when it was dug up in September 2014, the investigation found.

In addition to damaging nearby property, the blast caused $262,000 in damage to the utility's and its contractor's equipment, cost LG&E about $60,000 in emergency response costs, and required $950,000 in service restoration work, according to the commission.

PSC staff emphasized the severity of the violations, noting the impact of the pipeline rupture could have been more serious under different circumstances.

"Although there was no fire when the mechanical coupling on the 12-inch pipe failed, had there been ignition the consequences could have been 'catastrophic' considering the diameter of the pipe and volume of gas," the PSC's final order said, citing testimony from Joel Grugin, a Kentucky PSC regulatory and safety investigator.

The excavation crew working on the pipeline that day "would have probably not made it" if the gas had caught fire, according to the testimony.

The potential explosion had an impact radius of 165 feet from the rupture, meaning any buildings within that area would likely have been destroyed or severely damaged in the event of an ignition, according to the PSC. Several houses were within that radius, the testimony said.

Even before the incident, LG&E had stopped using the problematic type of connector pieces — couplers — on transmission pipelines, or larger-diameter, higher-pressure pipelines. The utility began removing transmission couplers as the utility encountered them starting in the mid-2000s, according to the PSC.

LG&E plans to remove couplers on distribution lines, or smaller-diameter lines closer to the end-users, as the utility comes across them in the course of inspections and other work. LG&E said it will inspect and collect data on the removed couplers, and track characteristics of connections found to have problems, such as the place of installation, the work crew, installation date and soil type.

There are about 1,350 mechanical couplers on LG&E's high-pressure distribution lines, according to the company.