Judge is skeptical of PG&E on safety

A state regulatory judge voiced skepticism about the extent of Pacific Gas and Electric Co.’s commitment to safety two weeks before the horrific Camp Fire put the utility’s practices under renewed public scrutiny.

Peter Allen, an administrative law judge for the California Public Utilities Commission, made the comments in the context of an investigation into PG&E’s corporate culture that began in 2015 in response to the deadly 2010 San Bruno pipeline blast. In a proposed decision directing the utility to implement the findings of a 2017 audit, Allen questioned

whether PG&E had gone far enough to prioritize safety across its organization.

“While in general we are encouraged by PG&E’s responsiveness to the (audit), we continue to have concerns about whether PG&E is truly changing its culture, or is just trying to ‘check the boxes,’ ” Allen wrote in the proposed decision issued Oct. 25.

The proposed decision is set to be considered by the commission when it meets Nov. 29 in San Francisco.

The safety investigation has taken on added significance due to the Camp Fire burning east of Chico in Butte County.

State fire investigators are still looking into the cause of the Camp Fire — the most destructive and deadly wildfire in California history — but the utility could be blamed. PG&E has said two pieces of its equipment malfunctioned in the fire area, one shortly before the blaze reportedly started and the other shortly after.

The investigation embraces both Pacific Gas and Electric and its investor-owned parent company, PG&E Corp.

Michael Picker, the president of the utilities commission, has said he wants to expand the ongoing PG&E safety investigation to include recent wildfires. And he told The Chronicle he concurs with Allen’s proposed decision.

“The utility has done a lot of things that make us safer, but still not to the level we expect,” Picker said Wednesday.

In the proposed order, Allen said PG&E “appears to have overstated the safety expertise of several of its directors” on the company board during earlier proceedings in the investigation.

“This Commission wants PG&E to have a genuine and effective safety culture that permeates the organization, not just a thin veneer or window dressing that superficially looks good but fails under stress,” Allen wrote.

PG&E has told the commission it agrees with the 61 safety recommendations the 2017 assessment targeted at the utility and has promised to implement most of them by the end of this year. Recommendations include adding safety to the list of qualifications PG&E used to select independent board directors, conducting a broad reassessment of the company’s safety programs and accelerating safety leadership training for crew foremen.

“While the full scope of a new phase in the CPUC’s Safety Culture proceeding hasn’t been communicated yet, PG&E welcomes any opportunity to receive feedback from our regulator as we strive to continuously improve,” said Tamar Sarkissian, a PG&E spokeswoman. “Wildfires are spreading at rates we’ve never seen before and we must work together across all sectors and disciplines to address this issue with urgency.”

As the utility tries to make improvements, some of its staunchest critics remain concerned about safety issues.

“I’m very concerned that PG&E continues to have problems following the basic rules of safely running their system,” said Mark Toney, executive director of The Utility Reform Network, which has been involved in the investigation process. “Unfortunately, the consequences of that failure can be devastating for everybody.”

The 2017 audit of PG&E was conducted for the commission by NorthStar Consulting Group. In a report that ran more than 330 pages, NorthStar said it believes “PG&E executive management is committed to safety,” as are field employees, noting that “no one desires to be unsafe.” But the report also identified crucial flaws in PG&E’s approach.

“While PG&E is committed to safety and efforts have been made to reduce incidents and increase the organizational focus on safety, these efforts have been somewhat reactionary — driven by immediate needs and an understandable sense of urgency, rather than a comprehensive enterprise-wide approach to addressing safety,” the NorthStar report said.

NorthStar concluded PG&E quickly moved to address gas system issues revealed by the San Bruno explosion, which killed eight people and destroyed 38 homes. But the utility moved slower when it came to the organization’s more general safety culture, the report said.

While Picker now wants PG&E’s wildfire response to be considered as part of the safety investigation, he said he is still devising a formal plan to make that happen.

“Again, this is not about the fires, and it’s not even about San Bruno. It’s really, how do you measure whether the organization is, from top to bottom, really addressing safety in a conscious, day to day, hour to hour way?” Picker said. “It’s not enough to have slogans. It’s not what you think — it’s what you do.”

As the investigation proceeds, PG&E’s board makeup may come under scrutiny, according to Picker. He noted the company still has several directors who were in place at the time of the pipeline explosion, which he said “doesn’t send a real message of accountability.”

But Picker isn’t yet sure whether the commission can force PG&E to change its board members. The utility and its publicly traded parent have technically separate boards, but they share the same 12 members. Different board members hold the position of chairman for the two entities.

“There will clearly be arguments as to whether we have the power to do that,” he said. “It just seems to me that it’s a necessary question to discuss.”