BILL ANALYSIS �
SB 705
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Date of Hearing: June 27, 2011
ASSEMBLY COMMITTEE ON UTILITIES AND COMMERCE
Steven Bradford, Chair
SB 705 (Leno) - As Amended: June 22, 2011
SENATE VOTE : 30-7
SUBJECT : Natural Gas Pipeline Safety
SUMMARY : This bill requires natural gas utilities regulated by
the California Public Utilities Commission (PUC) to develop
service and safety plans. Specifically, this bill :
1)Establishes the PUC as the state authority responsible for
regulating and enforcing gas pipeline transportation and
pipeline facilities, including development and administration
of a state pipeline safety program.
2)Establishes the State Fire Marshal as the exclusive safety
regulatory and enforcement authority over intrastate hazardous
liquid pipelines.
3)Requires Pacific Gas and Electric and Sempra (San Diego Gas
and Electric and Southern California Gas) to develop and
implement service and safety plans.
4)Specifies minimum requirements of the service and safety plans
in order to protect the public and gas corporation employees:
a) Identify and minimize hazards and risks
b) Identify safety systems to eliminate or minimize
hazards, including documentation
c) Provide adequate storage and transportation capacity
d) Provide patrol and inspection
e) Provide systems controls with respect to both equipment
and personnel procedures
f) Provide timely response to reported leaks or other
hazard conditions
g) Provide protocols for determining maximum allowable
operating pressure on relevant pipeline segments, including
documentation
h) Preparation to minimize damage and respond to
earthquakes and other major events
i) Meet or exceed minimum standards for safe design,
construction, installation, and maintenance of gas
transmission and distribution facilities
j) Ensure adequate number of trained workforce to implement
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the service and safety plan
aa) Additional matters the PUC determines should be included
1)Provides that meaningful participation by employees in
development and implementation of safety plans.
2)Requires the PUC to review and accept, modify, or reject the
service and safety plans by December 31, 2012, require
periodic updates to the plans, and provide additional reviews
at regular intervals.
3)Reorganizes existing statute governing natural gas service.
4)Allows just and reasonable cost recovery in rates.
EXISTING LAW :
State (PUC and the Office of the State Fire Marshal) and federal
(U.S. Department of Transportation) regulators are tasked with
ensuring that pipeline and hazardous materials operators have
risk management programs in place, that those programs are
designed in conformance with state and federal laws, that the
programs are effective in achieving safety for the public and
the employees of the operator, and that the entire system of
achieving safety continues to improve itself.
The PUC enforces statues and rules (General Order 112-E) which
establish, in addition to the Federal Pipeline Safety
Regulations, minimum requirements for the design, construction,
quality of materials, locations, testing, operations and
maintenance of facilities used in the gathering, transmission
and distribution of gas and in liquefied natural gas facilities
to safeguard life or limb, health, property and public welfare
and to provide that adequate service will be maintained by gas
utilities operating under the jurisdiction of the commission.
The PUC conducts compliance inspections, accident
investigations, reviews utilities' reports and records, conducts
construction inspections, conducts special studies, and takes
action in response to complaints and inquiries from the public
on issues regarding gas pipeline and electric safety. The PUC
also conducts audits and inspections of gas facilities owned and
operated by mobile home parks, and audits and inspections of
underground propane gas distributions systems.
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The PUC has responsibility to ensure compliance with federal
pipeline management standards for over 11,000 miles of
transmission pipeline and almost 2,350 miles of transmission
pipeline in high consequence areas.
The Office of the State Fire Marshal (SFM) regulates the safety
of approximately 5,500 miles of intrastate hazardous liquid
transportation pipelines and acts as an agent of the federal
Office of Pipeline Safety concerning the inspection of more than
2,000 miles of interstate pipelines. Pipeline Safety staff
inspect, test, and investigate to ensure compliance with all
federal and state pipeline safety laws and regulations. All
spills, ruptures, fires, or similar incidents are responded to
immediately; all such accidents are investigated for cause.
Hazardous liquid pipelines are also periodically tested for
integrity using procedures approved by SFM. The program has been
certified by the federal government since 1981. The SFM also
maintains Geographic Information Systems (GIS)-based maps of all
regulated pipelines and has been named as a state repository for
pipeline data by the National Pipeline Mapping System (NPMS).
FISCAL EFFECT : Unknown
COMMENTS :
According to the author, this bill requires a safety plan
process for each utility overseen by and subject to the approval
of the PUC and restricts the amount spent by utilities on safety
services that can be charged to ratepayers.
On September 9, 2010, a portion of a 30-inch diameter
underground natural gas transmission system of Pacific Gas and
Electric Company (PG&E) suddenly ruptured. The pipeline was
located under the asphalt paving at the intersection of Glenview
Drive and Earl Avenue in a residential area of San Bruno,
California. An explosion ensued, fueled by blowing natural gas.
The explosion and fire resulted in the loss of eight lives and
the total destruction of 38 homes. Seventy homes sustained
damage and eighteen homes adjacent to the destroyed dwellings
were left uninhabitable.
State and municipal authorities have safety agreements and/or
certifications with the U.S. Department of Transportation for
regulating intrastate and interstate pipelines. Federal law
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does not specifically name responsible agencies at the state and
local level for implementing federal law - it allows the
Department of Transportation to enter into agreements or receive
certifications from state and local authorities. Several
publicly owned utilities own and operate pipelines, including
Palo Alto, Sacramento Municipal Utility District, and Los
Angeles Department of Water and Power.
The author may wish to consider an amendment to clarify that the
provisions of this bill to specify the PUC's jurisdiction is
limited what is within the scope of the PUC's regulatory
authority and delineated in the PUC's certification to the U.S.
Department of Transportation.
RELATED LEGISLATION
AB 56 (Hill) requires the operators of natural gas pipelines to
institute safety programs and facilities modernization programs
and requires the Public Utilities Commission to oversee those
programs.
SB 44 (Corbett) requires the PUC to set emergency response
standards for PUC-regulated gas pipeline and distribution
systems and requires that access to pipeline maps be made
accessible to the State Fire Marshal and the local fire marshal
SB 216 (Yee) requires the Public Utilities Commission to
evaluate current safety practices with regard to intrastate
natural gas transmission pipelines. The bill requires operators
of natural gas transmission pipelines to install automatic or
remote-controlled shut off valves in areas of high population
density or where pipelines cross active seismic faults.
SB 879 (Padilla) requires the Public Utilities Commission to
require natural gas utilities to account for ratepayer funds
designated for pipeline maintenance and repair in a more
transparent way.
REGISTERED SUPPORT / OPPOSITION :
Support
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California Labor Federation
California Public Utilities Commission (CPUC)
Coalition of California Utility Employees (CCUE)
Consumer Federation of California
International Brotherhood of Electrical Workers (IBEW)
San Diego and Imperial Counties Labor Council
The Utility Reform Network (TURN)
Utility Workers Union of America (UWUA)
Opposition
None on file.
Analysis Prepared by : Susan Kateley / U. & C. / (916)
319-2083