Settlement Reached in 2016 Seattle Natural Gas Explosion Complaint

OLYMPIA, Wash., March 28 -- The Washington State Utilities and Transportation Commission issued the following news release:

Pipeline safety regulators and Puget Sound Energy have reached a settlement agreement in response to the complaint filed against the company for the 2016 natural gas explosion in the Greenwood neighborhood of Seattle. The settlement, filed by staff of the Utilities and Transportation Commission, would impose a total penalty of $2.75 million, suspending $1.25 million on the condition that the company completes a comprehensive inspection and remediation program. The settlement will be presented to the three member commission, which can choose to accept, reject, or modify the agreement. In September, UTC pipeline safety staff released the results of their investigation into the cause of the March 9, 2016 explosion that injured nine firefighters and caused extensive property damage. The investigation identified the immediate cause of the explosion as damage to an above-ground service line. The investigation also determined that the line was improperly retired in 2004, and therefore remained active until it was shut off after the explosion. The complaint alleged five violations related to improper deactivation of a pipeline and failure to perform periodic gas leak surveys and corrosion tests as required by pipeline safety regulations. In the settlement, PSE did not contest the five violations. In the settlement, staff and PSE agreed that one factor in the explosion was the improper retirement of the service line by a contractor in 2004. The parties also agreed that another factor was the physical damage caused by trespassers who regularly accessed the space where the line was located. The compliance program, if approved by the commission, will require PSE to identify, inspect, and remediate more than 40,000 retired service lines, categorized as follows:

* Group 1: Within 18 months, complete initial inspections on all 3,060 service lines retired by PSE's contractor between 2000-2010 located in business districts.

* Group 2: Within 24 months, complete initial inspections on a sample of 6,578 service lines for the 10,907 locations retired by PSE's contractor between 2000-2010 that serve high occupancy structures, prioritizing schools, public buildings, and hospitals.

* Group 3: Within 36 months complete initial inspections on a sample of 3,263 service lines for the 15,131 locations retired prior to 2000 that may have served high occupancy structures, prioritizing schools, public buildings, and hospitals.

* Group 4: Within 36 months complete initial inspections on a sample of 3,069 service lines for the 11,691 locations retired after 2010 that may have serve high occupancy structures, prioritizing schools, public buildings, and hospitals. If the company discovers an active gas line in the sample from Groups 2-4, PSE must inspect all locations within that group and file an amended compliance plan with the commission. PSE also agrees to evaluate active, above-ground service pipes as part of their regular inspection process with an enhanced focus on pipes susceptible to external damage, including tampering or vandalism. The settlement also requires PSE to review its standards and practices related to deactivating service lines and implement employee training on any changes. The Public Counsel Unit of the Washington State Attorney General's Office participated in the negotiations and took no formal position on the agreement. The parties acknowledge Public Counsel may seek to join or oppose the agreement at a later date. Puget Sound Energy operates a 12,000-mile natural gas distribution system and supplies natural gas to 785,000 customers, primarily in the Puget Sound area of Washington. The UTC sets the natural gas rates for PSE's residential, business, and industrial customers. Established by the Legislature in 1955, the UTC's Pipeline Safety Program regulates the safety practices of 31 pipeline operators and conducts safety inspections on more than 47,000 miles of gas and hazardous-liquid pipelines in Washington. The UTC also regulates all private, investor-owned natural gas utilities in the state.

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