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California gas utility fined $38 million for 2008 explosion that killed 1

By Michael Martinez, CNN
updated 6:05 PM EST, Fri December 2, 2011
STORY HIGHLIGHTS
  • NEW: The fine is largest ever for safety violations by a utility in California history
  • The fine against Pacific Gas & Electric is larger than a recommended $26 million
  • PG&E committed safety violations in 2008 explosion in Rancho Cordova
  • "This decision sends a signal," commissioner says

Los Angeles (CNN) -- Pacific Gas and Electric Company must pay $38 million for safety violations in connection with a Christmas Eve 2008 explosion and fire in northern California, officials said.

The penalty is the largest safety violation fine for a utility in California history, said Andrew Kotch, spokesman for the California Public Utilities Commission.

The fine was larger than the $26 million recommended to an administrative law judge, but the judge imposed the bigger fine, which was approved Thursday by the commission, officials said.

The explosion and fire were caused by a natural gas leak. They destroyed a house in Rancho Cordova, California, near Sacramento, authorities said.

One person died and five other people, including a utility worker and a firefighter, were injured.

The commission said PG&E committed safety violations that included not following its internal procedures after discovering the installation of a gas pipe with a wall thickness below specifications; not administering drug and alcohol tests after the Rancho Cordova explosion to all employees "whose performance on December 24, 2008, under the circumstances presented, could not be completely discounted as a contributing factor to the accident"; and making an "unreasonably delayed and not effective" response to a neighborhood resident's phone call about an outdoor gas leak odor.

"This decision sends a signal that California is taking a firm stand on integrity and safety in its gas distribution infrastructure," Timothy Alan Simon, the commissioner assigned in this proceeding, said in a statement.

PG&E can't raise rates on customers to recover any portion of the penalty and other costs associated with the commission's decision, and the fine payment will be turned over to the state's general fund, the commission said.

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