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Allegations of falsified pipeline records come at perilous time for PG&E utility

Allegations that Pacific Gas and Electric Co. systematically broke gas safety rules and falsified records for years could compound a set of recent problems at the utility company, including an ongoing probation violation inquiry and the parent company's suffering stock price.

The California Public Utilities Commission recently alleged that Pacific Gas and Electric, or PG&E, falsified tens of thousands of gas safety records over 2012-2017. While the CPUC's formal investigation into the allegations is just beginning, a commission staff inquiry found that PG&E did not have adequate staff to keep up with excavator requests for information on where exactly the utility's gas lines were but pressured locators to alter their records to make it appear that the company had been responding to the requests on time.

The CPUC is investigating both the record-keeping falsification allegations and the issues with PG&E's timely response to requests to locate underground infrastructure. The commission's order opening the investigation noted that both issues could constitute "serious" violations of the law.

PG&E is already on probation after receiving six felony criminal convictions — for violating pipeline safety laws and obstructing a related investigation — related to the company's deadly 2010 gas pipeline explosion in San Bruno, Calif. In sentencing the utility in 2017, the U.S. District Court for the Northern District of California said that as a condition of that five-year probation, "PG&E shall not commit another federal, state, or local crime."

The Utility Reform Network, or TURN, which advocates for ratepayers in California, expressed outrage that the utility may have further violated state gas safety rules.

"It's shocking to realize that in the wake of the San Bruno explosion, in which PG&E needlessly caused eight deaths, PG&E simply continued lying to authorities about pipeline safety practices, especially considering that PG&E, a convicted felon, is on probation for that same crime," TURN spokeswoman Mindy Spatt said in a Dec. 17 email. "Consumers who live every day with the fear of PG&E's negligence and incompetence are looking to both the CPUC and the federal court to do more to prevent PG&E from continuing its criminal ways and hold management accountable for these inexplicably risky policies."

"We're committed to accurate and thorough reporting and record-keeping, and we didn't live up to that commitment in this case," PG&E said in an emailed statement Dec. 15. "Once that became apparent, we took and continue to take additional actions to meet the regulatory standards related to our locate and mark record-keeping."

The district court in November asked PG&E to comment on whether any of the 2017 judgment's terms "might be implicated were any wildfire started by reckless operation or maintenance of PG&E power lines" related to the highly destructive Camp Fire in November. The court in early December also asked the California attorney general to weigh in on "the extent to which, if at all, the reckless operation or maintenance of PG&E power lines would constitute a crime under California law."

Parent company PG&E Corp.'s stock suffered on the heels of the CPUC's Dec. 14 investigation announcement. Having closed Dec. 14 at $26.01, the shares finished the day Dec. 17 at $24.44, a drop of 6.04%.

PG&E Corp.'s shares were already struggling to recover from investor concerns that the utility's infrastructure was at fault in the Camp Fire. As recently as Nov. 7, PG&E Corp.'s shares were at $48.80, but the stock price slid Nov. 15 to $17.74.

An investigation is ongoing into the fire's cause, but Pacific Gas and Electric has submitted multiple reports of line outages near the Camp Fire in Northern California around the time the fire began.