NTSB Safety Recommendation P-10-003

NTSB safety recommendation P-10-003.

TO THE PACIFIC GAS AND ELECTRIC COMPANY: Use the traceable, verifiable, and complete records located by implementation of Safety Recommendation P-10-2 (Urgent) to determine the valid maximum allowable operating pressure, based on the weakest section of the pipeline or component to ensure safe operation, of Pacific Gas and Electric Company natural gas transmission lines in class 3 and class 4 locations and class 1 and class 2 high consequence areas that have not had a maximum allowable operating pressure established through prior hydrostatic testing. (Urgent)

Priority: CLASS I

Overall Status: Closed - Acceptable Action

Issued Date: 2011-01-03

Adopted Date: 2010-12-30

Overall Date Closed: 2013-03-14

Synopsis: On September 9, 2010, about 6:11 p.m. Pacific daylight time,1 a 30-inch-diameter natural gas transmission pipeline (Line 132) owned and operated by Pacific Gas and Electric Company (PG&E) ruptured in a residential area in the city of San Bruno, California. The accident killed eight people, injured many more, and caused substantial property damage. The rupture on Line 132 occurred near milepost 39.33, at the intersection of Earl Avenue and Glenview Drive in San Bruno. About 47.6 million standard cubic feet of natural gas were released as a result of the rupture. The rupture created a crater about 72 feet long by 26 feet wide. A ruptured pipe segment about 28 feet long was found about 100 feet away from the crater. The released natural gas was ignited sometime after the rupture; the resulting fire destroyed 37 homes and damaged 18.

Probable Cause: The National Transportation Safety Board determines that the probable cause of the accident was the Pacific Gas and Electric Company's (PG&E) (1) inadequate quality assurance and quality control in 1956 during its Line 132 relocation project, which allowed the installation of a substandard and poorly welded pipe section with a visible seam weld flaw that, over time grew to a critical size, causing the pipeline to rupture during a pressure increase stemming from poorly planned electrical work at the Milpitas Terminal; and (2) inadequate pipeline integrity management program, which failed to detect and repair or remove the defective pipe section.

Ntsbnumber: DCA10MP008

Report Number: PAR-11-01

Addressee Name: Pacific Gas and Electric Company

Addressee Status: Closed - Acceptable Action

Addressee Date Closed: 2013-03-14

Addressee Acronym: PG&E

Addressee Organization Type: P-Private Industry

Communication Date: 2012-03-13

Communication Type: Official Correspondence

Communication Contents: The NTSB notes the following: • PG&E has met its California Public Utilities Commission (CPUC) deadlines related to records verification and MAOP validation of 760 miles of pipeline in HCAs. • More than 1600 miles of pipeline in HCAs in PG&E’s service territory have undergone records verification and MAOP validation. • PG&E is working to complete records verification and MAOP validation for all pipelines in HCAs. Accordingly, pending completion of action to satisfy Safety Recommendation P-10-3, this recommendation is classified OPEN—ACCEPTABLE RESPONSE.

Addressee Acronym: PG&E

Addressee Organization Type: P-Private Industry

Communication Date: 2012-08-29

Communication Type: Official Correspondence

Communication Contents: The NTSB notes that, in January 2012, PG&E completed validation for 2,088 miles of pipeline located in HCAs and that, during this work, PG&E submitted periodic updates to the California Public Utilities Commission (CPUC) on its progress. Through April 2012, PG&E completed validation of 1,032 miles of non-HCA pipeline, and it is continuing its work to validate the remaining non-HCA pipeline. PG&E estimates it will have validated over 4,600 miles of non-HCA pipeline by early 2013. Pending completion of this work, Safety Recommendation P-10-3 is classified OPEN—ACCEPTABLE RESPONSE.

Addressee Acronym: PG&E

Addressee Organization Type: P-Private Industry

Communication Date: 2011-03-14

Communication Type: Official Correspondence

Communication Contents: The NTSB is pleased with the following actions that PG&E is taking to implement these recommendations: • PG&E’s business lead for this records verification project reports directly to the Senior Vice President, Engineering and Operations. • PG&E has retained numerous leading external partners to lend specialized expertise and significant additional resources to this process in the areas of document management, process controls, engineering, pipeline pressure calculations, and auditing. • PG&E has leased new space to house the record verification operations and has built out space in its existing facilities to accommodate this activity. • PG&E has collected hundreds or boxes of original records from over 20 field office and other locations across the service territory, and document scanning and indexing operations are proceeding 24 hours a day, 7 days a week. PG&E further reports it is using the scanned and indexed records to verify the completeness of pressure test records and other applicable records used to establish each line’s maximum allowable operating pressure (MAOP) per industry standards and Federal code compliance. Over the next 6 weeks, PG&E will determine the total number of miles for which it has complete, verifiable, and traceable records of prior pressure tests, and will start the process of using all available verified records identified in the collection, scanning, and indexing process to compile a segment-by-segment pipeline features list. Where necessary, PG&E will perform excavations to verify pipeline features. In the end, as directed by the California Public Service Commission, the MAOP will be validated based on the weakest segment in the transmission pipeline sections of these Class 3 and 4 locations and Class 1 and 2 high consequence areas. In addition, PG&E reports it is taking all steps to ensure the safety and integrity of its gas pipeline systems, including verifying the underlying records of over 1,800 miles of pipeline by March 15, 2011. Because these actions, when completed, should satisfy Safety Recommendations P-10-2 through -4, the recommendations are classified OPEN – ACCEPTABLE RESPONSE.

Addressee Acronym: PG&E

Addressee Organization Type: P-Private Industry

Communication Date: 2011-11-23

Communication Type: Official Correspondence

Communication Contents: -From NTSB. –To: Christina Sames, Vice President Operations and Engineering, American Gas Association. NOT TO THE ADDRESSEE. NOT TO PGE. Thank you for your June 14, 2011, letter, regarding Safety Recommendations P-10-01 through -04, which the National Transportation Safety Board (NTSB) issued on January 3, 2011, regarding the San Bruno, California, pipeline accident. Safety Recommendation P-10-01 was issued to the Pipeline and Hazardous Materials Safety Administration (PHMSA), and Safety Recommendations P-10-02 through -04 were issued to the Pacific Gas and Electric Company (PG&E); all were urgent recommendations. The San Bruno pipeline accident report and the related safety recommendation issuance letters are posted on the NTSB’s website at http://www.ntsb.gov/doclib/reports/2011/PAR1101.pdf and http://www.ntsb.gov/recsletters/ DisplayLetters.aspx?FolderYR=2011, respectively. Your interpretations of our intent in issuing these recommendations, stated in your letter, are correct. To address another of your concerns, the NTSB does not intend for Federal or state agencies to codify the language from our safety recommendations directly into state and Federal rules and regulations. We believe that each agency should develop appropriate language for its own rules and regulations, to address and accomplish the intent of our safety recommendations. Of particular concern to you and your organization is the requirement for a postconstruction hydrostatic pressure test. For pipelines constructed before 1970 that were not required to be hydrostatically tested, 49 Code of Federal Regulations (CFR) 192.619(a)(3), commonly referred to as the “grandfather clause,” allows the maximum allowable operating pressure (MAOP) to be based on “the highest actual operating pressure to which the segment was subjected during the 5 years preceding … July 1, 1970.” In contrast to MAOP based on hydrostatic pressure testing, the grandfather clause does not specify a minimum amount of time that the historical pressure must have been held to be used as the basis for the MAOP. Studies have shown that hydrostatic pressure testing is most effective when it incorporates a spike test in which the pipeline is initially pressurized to a higher level for a short time. Accordingly, the NTSB recommended that PHMSA amend 49 CFR 192.619 to delete the grandfather clause and to require that all gas transmission pipelines constructed before 1970 be subjected to a hydrostatic pressure test that incorporates a spike test. Additional information regarding this safety recommendation can be obtained in our San Bruno pipeline accident report, at the address cited above. The NTSB considers the San Bruno accident report and the safety recommendations issued as a result of our findings, to be of the utmost importance to the gas pipeline industry and to the American people. We encourage all involved interests, including the AGA, to ensure that pipelines are maintained properly and are operated safely. Thank you for your interest in these very important pipeline safety issues. Should you require any additional information or clarification, please contact us.

Addressee Acronym: PG&E

Addressee Organization Type: P-Private Industry

Communication Date: 2013-03-14

Communication Type: Official Correspondence

Communication Contents: Because PG&E validated the MAOP of its pipeline system, as requested, Safety Recommendation P-10-3 is classified CLOSED—ACCEPTABLE ACTION. The NTSB recognizes that this was a major undertaking, as it entailed validation of the MAOP of 2,088 miles of these transmission pipelines. We are pleased that PGE also is validating an additional 4,199 miles of non-HCA pipelines.

Addressee Acronym: PG&E

Addressee Organization Type: P-Private Industry

Communication Date: 2011-02-02

Communication Type: Official Correspondence

Communication Contents: CC# 201100045: - From Christopher P. Johnson, President: On January 3, 2011, the National Transportation Safety Board (NTSB) issued several Safety Recommendations to PG&E and others arising out of its ongoing investigation into the tragic accident in San Bruno, California, on September 9, 2010. In your January 3 letter, you requested that PG&E respond within thirty days with the actions we have taken or intend to take to implement your recommendations. PG&E is fully committed to working expeditiously and cooperatively with the NTSB, the California Public Utilities Commission (CPUC) and other stakeholders to restore public confidence in the safety and integrity of our natural gas transmission system. Ensuring the completeness and the accuracy of PG&E's system records is absolutely fundamental to this effort. As you know, the same day that the NTSB issued these Safety Recommendations to PG&E and sent related Safety Recommendations P-10-5 through P-10-7 to the CPUC, the CPUC's Executive Director sent PG&E a directive to implement the NTSB's Safety Recommendations. The Executive Director's letter was subsequently ratified by CPUC Resolution L-410. On January 7, 2011, PG&E responded to the CPUC's letter, with a description of the scope of the task and the efforts already underway. Yesterday we provided the CPUC with a more detailed update on the work and the plan going forward. A copy of each of our letters is enclosed. PG&E is dedicated to taking all steps to ensure the safety and integrity of our gas pipeline systems, including the monumental effort of verifying the underlying records of over 1,800 miles of pipeline by March 15th. In the meantime, however, if you have any questions, please do not hesitate to contact me. A January 7, 2011 letters from Pacific Gas and Electric to the California Public Utilities Commission: PG&E is fully committed to working expeditiously and cooperatively with the Commission to restore public confidence in the safety and integrity of our natural gas transmission system. Ensuring the completeness and the accuracy of PG&E's system records is absolutely fundamental to this effort. Accordingly, our customers and the Commission have PG&E's pledge that verifying its gas system records is among PG&E's most immediate and highest priorities. As you know, following the San Bruno accident, we discovered a discrepancy in OUI' records. A discrepancy of this nature is not acceptable to us, We initiated a comprehensive records review for the approximately 150 miles of transmission pipeline on the San Francisco Peninsula, Your directive following this week's National Transportation Safety Board (NTSB) recommendations calls on us to extend this type of review to approximately 1,800 miles of transmission pipelines in class 3 and class 4 locations and class I and class 2 high consequence areas throughout our service area. Your January 3, 2011, letter directed PO&E to undertake specific actions in response to the NTSB recommendations and requested that we confirm by today whether this work could be completed by February 1, 2011. PG&E recognizes and supports the urgency surrounding this work and is moving forward aggressively. Our first step, already under way, is to gather all hydrostatic and other pressure test information to verify which pipeline segments have had their maximum allowable operating pressure established through pressure testing. Although we maintain a centralized data base that indicates that the majority of the 1,800 miles of pipeline have been pressure tested, we understand that your directive requires us to review and verify the original paper records, which currently are kept in local offices and records storage facilities. As pal1 of this process, we will also be collecting images of the original records in a centralized system, which is consistent with our understanding of your request. A February 1, 2011 letters from Pacific Gas and Electric to the California Public Utilities Commission: In our January 7, 2011, letter to you we committed to provide the California Public Utilities Commission (Commission) with an update of our progress in fulfilling the directives in your January 3, 2011 letter, ratified by the Commission through Resolution 1.,-410 on January 13, 2011. PG&E is aggressively and diligently working to meet the expectations of the Commission to perform our records review and verification work by March 15, 2011. This letter provides an update on PG&E's work and plan going forward. The Commission's directive applies to over 1,800 miles of gas transmission pipelines in Class 3 and Class 4 locations, and Class I and 2 high consequence areas throughout PG&E's service territory. Consistent with federal regulations, not all of these lines require a pressure test-established maximum allowable operating pressure (MAOP); nevertheless, we are in the process of verifying the number of these pipeline miles for we have records of pressure tests, containing the information required by 49 C.F.R. § 192.517(a). The foundational step and PG&E's initial focus have been collecting, scanning and indexing an estimated 1.25 million individual records associated with approximately 2,750 "job numbers" from PG&E's hard copy records into its electronic database. It is critical to the remainder of this records verification and validation effort that tbis first step provide comprehensive, high quality electronic documentation of PG&E's gas transmission system. Toward that end, the entire process is being subjected to detailed quality assurance oversight, as described in more detail below. As part of the first phase of this records verification project, PG&E has taken the following actions: • PG&E's business lead for this records verification project reports directly to the Senior Vice President, Engineering & Operations. The business lead oversees an internal team of over 50 engineers, estimators, mappers, information technology specialists and managers dedicated exclusively to the project; this team will continue to grow. • PG&E has retained numerous leading external partners to lend specialized expertise and significant additional resources to this process in the areas of document management, process controls, engineering, pipeline pressure calculations, and auditing. For example, Iron Mountain, Inc., a leading global document management company, is dedicating over 230 staff to assist PG&E in timely completing the document collection, scanning and indexing operation. • PG&E has leased new space to house the record verification operations as well as built out space in its existing facilities to accommodate this activity. Progress to date on this project includes: • Document scanning and indexing operations are proceeding 24 hours-a-day, seven days-a-week. • PG&E has collected hundreds or boxes of original records from over 20 field office and other locations across the service territory. • At this stage, PG&E is scanning and indexing tens of thousands of these documents each day. PG&E is using the scanned and indexed records to verify the completeness of pressure test records and other applicable records used to establish each line's MAOP per industry standards and federal code compliance. Over the next six weeks, PG&E will determine the total number of miles for which it has complete, verifiable and traceable records of prior pressure tests. At the same time, PG&E will start the process of using all available verified records identified in the collection, scanning and indexing process to compile a segment-bysegment pipeline features list (PFL). Where necessary, PG&E will perform excavations to verify pipeline features. In the end, as directed by the Commission, MAOP will be validated based on the weakest segment in these Class 3 and 4, and Class I and 2 HCA transmission pipeline sections. PG&E is dedicated to taking all steps to ensure the safety and integrity of our gas pipeline systems, including

Addressee Acronym: PG&E

Addressee Organization Type: P-Private Industry

Communication Date: 2011-06-14

Communication Type: Official Correspondence

Communication Contents: From The American Gas Association, NOT FROM THE ADDRESSEEE. NOT FROM PGE. –From Christina Sames, Vice President, Operations and Engineering, American Gas Association: The American Gas Association (AGA) has reviewed the safety recommendations issued by the National Transportation Safety Board (NTSB) on January 3, 2011 (P-10-1 through P-10-7). As is our practice, AGA forwarded the recommendations to its member companies. AGA has received a number of questions from its members regarding the' NTSB recommendations and is therefore seeking clarification. Our members, who operate approximately 50,000 miles of transmission pipeline, have been actively engaged in following the developments of the investigation and have been considering how that information should be used to reduce the probability of similar incidents on their system. To that end, the NTSB's recommendations serve as prudent guidance regarding potential safety problems that operators may need to act on if it addresses a relevant factor on their system. Given these recommendations have not gone through the cost-benefit analysis, public notice and comment due process or analysis for potential adverse consequences, which are all normal steps in the rulemaking process, it is assumed these recommendations should not be considered a regulatory mandate nor should they be followed verbatim if the circumstances are not applicable for their system. To ensure appropriate response, AGA is seeking clarification from the NTSB that it did not intend for federal or state regulators to codify the exact language in the safety recommendations into state and federal pipeline safety codes which are applicable to all operators. In many cases, the safety recommendations appear to conflict with existing language, in other instances, the recommendations omit key provisions of the pipeline safety regulations. The clarification of the intended scope and applicability of the safety recommendations will allow operators nationwide to focus finite resources on appropriate areas that will provide real improvement in pipeline safety rather than diluting efforts in as that were never intended by the NTSB. Specific NTSB safety: recommendations that AGA believes should be clarified to achieve a consistent interpretation across the natural gas industry include P-10-1 to P-:-10-4 as follows. P-10-001: Please clarify the NTSB's intent relative to recommendation P-10-1. AGA believes the NTSB intended that PHMSA should inform pipeline operators of the circumstances and consequences surrounding the pipeline rupture in San Bruno and that, based on this information, operators should take appropriate action, if necessary, to conduct additional records searches based on the unique circumstances of their individual systems. AGA believes that the NTSB did not intend all natural gas transmission pipeline operators to implement an exhaustive records search or the other provisions detailed in recommendations P-10-2 to P-10-4 (below). P-10-002: Please clarify the NTSB's intent related to recommendation P-10-2. AGA believes that the NTSB intended that the recommendation to "aggressively and diligently search for all as-built drawings, alignment sheets, and specifications, and all design, construction, inspection, testing, maintenance, and other related records" applied exclusively to Pacific Gas and Electric Company or other operators who in individually determine the need to conduct a detailed records search for their natural gas transmission lines in class 3 and class 4 locations and class 1 and class 2 high consequence areas that have not had a maximum allowable operating pressure (MAOP) established through prior hydrostatic or pressure testing. AGA also requests that the NTSB clarify its use of the term "hydrostatic testing." AGA believes the intent of the recommendation was to focus the record search on pipelines where MAOP has not been previously established through "pressure testing" in accordance with 49 CFR Part 192, Subpart J add 192.619 (see the request for clarification to P-10-4 below). AGA also requests clarification for transmission pipelines installed prior to the enactment of Subpart J. AGA believes the phrase "established through prior hydrostatic pressure testing" is meant to address the stability of transmission pipeline longitudinal seams through a post construction pressure test and no a requirement to have all pipelines be tested to Subpart J standards. Finally, AGA requests that the NTSB provide clarification to the phrase "traceable, verifiable and complete". AGA believes that the recommendation was intended to direct Pacific Gas and Electric to identify records confirming the strength of the line pipe and related components from the time of construction. In the event that the appropriate records are unavailable for any reason, AGA believes the N SB intended PG&E, or other operator who individually determines the need to conduct a detailed records search, to make a conservative default assumption relative to the strength of the respective pipe or components. P-10-003: Please clarify the NTSB's intent related to recommendation P-10-3. AGA believes that the NTSB intended the recommendation to use traceable, verifiable, and complete records located by implementation of P-0-2 to determine the valid MAOP of natural gas transmission lines in class 3 and class 4 locations and class 1 and class 2 high consequence areas that have not had an MAOP established through prior hydrostatic or pressure testing to apply exclusively to Pacific Gas and Electric Company or those operators who individually determine the need to re-establish the MAOP of natural gas transmission lines based on the information contained in the PHMSA Advisory. As noted in the response to P-10-2 (above) and P-10-4 (below), please clarify NTSB's intent that the MAOP could have been previously established using "pressure testing" as defined by the provisions of 49 CFR Part 192, Subpart J and 1 2.619. P-10-004: Please clarify the NTSB's intent related to recommendation P-10-4. AGA believes that the NTSB intended for recommendation P-10-4, requiring natural gas transmission pipelines in class 3 and class 4 locations and class 1 and class 2 high consequence areas that have not had a maximum allowable operating pressure established through "prior pressure testing" to have the MAOP determined by a spike test followed by a hydrostatic pressure test, to apply exclusively to Pacific Gas and Electric Company. AS the NTSB noted in the safety recommendations, an operator may not be able to comply with safety recommendations P-10-2 and P-10-3. Operators have stated before the California Public Utility Commission (CPUC) that "traceable, verifiable and complete records for pipelines installed over 50 years ago was a very difficult, if not infeasible threshold to achieve." The phrase is not used in applicable regulations. As the NTSB noted, "Although hydrostatic testing is recognized to be a direct and effective methodology for validating an MAOP, its implementation requires that operating lines be shut down, which may adversely affect customers dependent on the natural gas supplied by the pipeline, particularly if the pipe fails during the test, which could necessitate a protracted shutdown." In addition, AGA notes that by placing water, a corrosive fluid, in a pipeline there is a very real possibility of introducing an unintended consequence of internal corrosion to the pipeline if the water is not eliminated completely after the hydro-test. Complete dehydration is extremely difficult for a pipeline that has already been placed into se ice and lines that include certain valves and laterals. Since the pipeline safety code, 49 CFR Part 192 -Transportation of Natural Gas by Pipeline: Minimum Federal Safety Standards, was established in 1970, operators and regulators have been very clear on the regulatory requirements for establishing the MAOP of new, r

Addressee Acronym: PG&E

Addressee Organization Type: P-Private Industry

Communication Date: 2013-09-04

Communication Type: Official Correspondence

Communication Contents: -From Christopher P. Johns, President, Pacific Gas and Electric: Pacific Gas and Electric Company (PG&E) continues to implement actions necessary to meet or exceed the requirements of the National Transportation Safety Board's (NTSB) safety recommendations as an important part of improving the safety of our gas pipeline system. We understand that your office recently received questions concerning PG&E's determination of maximum allowable operating pressure (MAOP). PG&E notified the California Public Utilities Commission (CPUC or Commission) of records that we had found to be inaccurate and that revealed gaps in the early stages of our MAOP validation process. As we work with the CPUC on these issues, we want you to know that we believe that the actions taken by PG&E to implement Safety Recommendation P-1 0-3 have been appropriate to validate MAOP. The information summarized in this letter is from PG&E's Verified Statement of PG&E's Vice President of Gas Transmission Maintenance and Construction submitted on August 30, 2013, to the CPUC. PG&E is committed to transparency and as such should have notified the NTSB about these issues as soon as we became aware of them. We apologize for this oversight and are providing additional information to give clarity around PG&E's MAOP validation work. This additional information is intended to provide you and the NTSB with evidence of the work we have done to address the NTSB's recommendations and of our continuing commitment to put safety first in all actions related to the operation of our natural gas pipeline system. The NTSWs Safety Recommendation P-10-3 states as follows: Use the traceable, verifiable, and complete records located by implementation of Safety Recommendation P-10-2 (Urgent) to determine the valid maximum allowable operating pressure, based on the weakest section of the pipeline or component to ensure safe operation, of Pacific Gas and Electric Company natural gas transmission lines in class 3 and class 4 locations and class 1 and class 2 high consequence areas that have not had a maximum allowable operating pressure established through prior hydrostatic testing (P-10-4 ). PG&E completed MAOP validation for all pipelines in class locations 3 and 4 and in high consequence areas in class locations 1 and 2 in January 2012 as reported to the CPUC and to the NTSB. The MAOP validation was based on the weakest section of the pipeline or component in class 3 and 4 locations and class 1 and 2 high consequence areas that did not have an MAOP established through prior hydrostatic testing. In addition to completing NTSB Recommendation P-1 0-3, PG&E has validated all remaining transmission lines in non-high consequence areas. On December 15, 2011 , the Commission issued a decision to PG&E's request to lift operating pressure restrictions authorizing PG&E to operate Lines 101, 132A and 147 to no higher than 365 psig. On July 3, 2013, PG&E submitted a document to the Commission that identified errors in some of the information previously filed to support lifting operating pressure restrictions. That document identified two types of errors in our previously-filed information: • Errors based on inaccurate pipe specifications. We have identified errors in our previously-submitted pipe specifications for a total of four segments of Line 147. Three of these lowered the maximum allowable operating pressure (MAOP) of Line 147 below the Commission-authorized 365 pounds per square inch gauge (psig) ; • Errors based on a corrected regulatory interpretation. We have recently concluded based on a conservative reading of the federal pipeline regulations that we inappropriately relied on a 1989 hydro test to set the MAOP for one segment of Line 1 01 . Although we have acknowledged the need to correct our previously-submitted documentation for Line 147, all of the class 3 and 4 and class 1 and 2 high consequence area pipe have been strength tested to pressures well in excess of the 365 psig pressure we asked the Commission to authorize. In accordance with NTSB Recommendation P-10-2 (Records), we have undertaken an unprecedented effort to collect and organize our records to validate the MAOP of our entire gas transmission system. We recognize that our older, historic records are not complete. That is why we have embarked on a program, supported by the Commission in Decision 11-06-017, to strength test to modern standards or replace all transmission pipe for which we do not have complete, verifiable records of an appropriate strength test. The issues we identified in our Line 147 documentation revealed gaps in the early stages of our MAOP validation process, and we have continued to refine and improve this process over the year and a half since we filed our pressure restoration request. Examples of such enhancements include: (a) additional independent third-party review; (b) testing and validation of conservative engineering assumptions; and (c) implementing a computerized engineering data validation tool. These measures are part of our continuous improvement efforts, and raise our level of confidence in the rigor of our process and minimize the opportunity for errors going forward. We are continuing to strength test our transmission pipe so that the safety of all of our pipelines will ultimately be confirmed by a pressure test. Additionally, we continue to apply the findings from field excavations to confirm the accuracy of our existing records .and validate our conservative engineering assumptions. The inaccuracies identified also prompted us to review the way we were interpreting the federal code provisions related to class locations (i.e., the population density of areas in which pipelines operate). Specifically, we came to focus on a specific section of the federal code that was repealed over 15 years ago which gave pipeline operators a three-year window from 1971 to 1974 to determine the class locations in which their pipelines were operating and validate their respective MAOPs via strength tests. Historically, PG&E had interpreted 49 C.F.R. 192.611 to allow a pipeline to operate one class location above its original design ("one class-out") as long as it had been subjected to a valid Subpart J pressure test for eight hours in a different year than the install year. PG&E now believes that 192.611 (a) may preclude operators from relying upon a post-1974 pressure test to operate a segment "one class-out" if that segment changed up in class before April15, 1971. Applying our revised interpretation of the one-class-out provisions and analyzing the pipeline, we determined that one segment of Line 101 had changed class prior to 1971 and was strength tested after 1974. That segment changed from a class 2 to class 3 in approximately 1952. The segment had a strength test to 650 psig in 1989, which would support an MAOP of 433 psig in a class 3 location. The MAOP validation records PG&E submitted to the Commission in October 2011 showed this segment of Line 101 capable of operating at 60 percent SMYS with a MAOP of 396 psig, and indicated it was "operating in class" in light of the strength test and per our historical application of the code. However, since the 1989 strength test cannot be used to allow the segment to operate one-class-out, class 3 requires an MAOP of 330 psig. The CPUC's Safety and Enforcement Division (SED) agrees that as long as properly conducted pressure tests were performed as represented, Lines147 and 101 can be operated consistent with state and federal regulations at the current reduced pressure. The SED emphasized the importance of pressure testing to guard against any record-keeping shortcomings, and agreed that all public safety issues have been addressed by PG&E's operational actions. On August 19, 2013, the Commission issued an Order to Show Cause why authority to increase operating pressure should not be stayed and directed PG&E to file a statement by August 30,

Addressee Acronym: PG&E

Addressee Organization Type: P-Private Industry

Communication Date: 2013-01-31

Communication Type: Official Correspondence

Communication Contents: -From Christopher P. Johns, President: Pacific Gas and Electric Company (PG&E) continues to make substantial progress implementing the safety recommendations outlined by the NTSB's investigation of the September 2010 San Bruno pipeline accident. This status report provides details on the actions we are taking to assure public safety remains the company's highest priority. In 2012, the NTSB evaluated PG&E's progress and closed four recommendations: 1. pe10-2: Search for Records 2. P-11-3: 911 Notifications 3. P-11-25: Emergency Response Procedures 4. P-11-28: Toxicology Testing In this report, we are submitting three additional recommendations for closure consideration by the NTSB: 1. P-10-3: MAOP Validation 2. P-11-24: Work Clearance Procedures 3. P-11-31: Public Awareness Program Continuous Improvement For recommendation P-10-3 (MAOP Validation), PG&E has completed the determination of the valid maximum allowable operating pressure (MAOP), based on the weakest section of the pipeline or component. The purpose of the MAOP validation is to ensure safe operation of natural gas transmission lines in class 3 and class 4 locations and class 1 and class 2 high consequence areas (HCA) that have not had a MAOP established through prior hydrostatic testing. In total, MAOP validation was performed for all 2,088 miles of these transmission pipelines. In addition to completing NTSB Recommendation P-10-3, PG&E is validating all remaining transmission lines in non-HCAs by mid- 2013. In 2012, PG&E completed the MAOP validation of 4, 199 miles of non-HCA pipelines. For recommendation P-11-24 (Work Clearance Procedures), PG&E has completed the revision and issuance of work clearance procedures that include requirements for identifying the likelihood and consequences of failure associated with planned work. The development of contingency plans is now a part of this process. PG&E's new procedure ensures accurate and completed clearance forms and requires field crews, control room operators and individuals who have been assigned the clearance supervisor role to have complete knowledge of the intended work and written clearance procedure. PG&E has completed recommendation P-11-31 (Public Awareness Program Continuous Improvement) through the development and incorporation of written performance measurements and guidelines into our Public Awareness Plan (PAP) for evaluating the plan and for continuous program improvement. The primary objectives include awareness, damage prevention and emergency response readiness. PG&E has also completed two portions of recommendation P-11-29 (Integrity Management Program): Revisions to PG&E's Risk Model and Risk Analysis Methodology. Other recommendations with significant progress highlighted in the attachment include: • (P-10-4)-ln 2012, PG&E strength tested or verified an additional 202 miles for a total of 417 miles since 2011 • (P-11-2)-PG&E installed 46 valves in 2012 (for a total of 59 valves since 2010) • (P-11-29)-ln addition to revising the Integrity Management Risk Model and Risk Analysis Methodology, PG&E is continuing to revise other portions of its integrity management program PG&E thanks the NTSB for both its continuing guidance and leadership as the company works to address the remaining safety recommendations. Please contact me directly if you have any questions. PG&E has completed MAOP validation for all pipelines in Class Locations 3 and 4 and in HCAs in Class Locations 1 and 2 in January 2012 as reported to the CPUC (Attachment P-10-3 MAOP). The MAOP validation was based on the weakest section of the pipeline or component in class 3 and 4 locations and class 1 and 2 HCAs that did not have a maximum allowable operating pressure established through prior hydrostatic testing. In addition to completing NTSB Recommendation P•10-3, PG&E is validating all remaining transmission lines in non-HCAs and will be completed by mid- 2013. In 2012, PG&E completed the MAOP validation of 4,199 miles of non-HCA pipelines. PG&E's "System and Method for Validating and Reporting Maximum Allowable Operating Pressure" is now available for commercial use for the North American Pipeline Industry.

Addressee Acronym: PG&E

Addressee Organization Type: P-Private Industry

Communication Date: 2012-05-23

Communication Type: Official Correspondence

Communication Contents: -From Christopher P. Johns, President: Pacific Gas and Electric Company (PG&E) is making substantial progress to implement the safety recommendations outlined by the National\ Transportation Safety Board's (NTSB) investigation of the September 2010 San Bruno pipeline accident. This status report details the actions PG&E has taken and will continue to take to assure public safety remains the company's highest priority in the operation of our natural gas transmission system. We have made many fundamental changes to the operations and management practices throughout our gas organization. Some of the more critical actions include: completion of the Maximum Allowable Operating Pressure validation of all 2,088 miles of high consequence area (HCA) pipelines; validation of 1,032 miles of non -HCA pipelines through April 2012; and automation of 36 valves. In 2011, PG&E conducted strength tests and verified strength test pressure records for a total of approximately 214.5 miles of pipeline. Additionally, from January through April 2012, an additional 37.6 miles have been tested or verified. PG&E's Pipeline Safety Enhancement Plan (PSEP), currently before the CPUC for approval in R.11-02-019, outlines our plan for testing or verifying records of 547 miles in 2012 -2014. PG&E has modified its 911 Notification Process to respond to the NTSB's suggestion that SCADA real time operating data and alarms serve as triggers for 911 notifications. We have developed a comprehensive emergency response procedure for large-scale emergencies on transmission lines, which identifies a single person in charge, outlines specific protocols and provides for drills and training. PG&E has also incorporated performance measures and guidelines to assure continuous improvement in our public awareness program. PG&E has initiated a complete assessment of every aspect of our transmission integrity management program including threat identification and assessment. Much more work lays ahead, but the progress to date gives us confidence that PG&E is on track to achieving the goal of regaining the trust of the public and our regulators by demonstrating our steadfast commitment to safety. The attachment to this letter provides a more detailed summary of each NTSB recommendation and the steps we have taken and continue to take to act upon them. If you have any questions, please contact me directly. On January 31, 2012, PG&E completed the work associated with all pipelines located in HCAs. Using the records collected in response to NTSB's Recommendation P-10-2, PG&E has determined the valid maximum allowable operating pressure (MAOP), based on the weakest section of the pipeline or component and in accordance with the traceable, verifiable and complete standard, to ensure safe operation of PG&E's natural gas transmission lines in class 3 and 4 locations and class 1 and 2 HCAs that have not had an MAOP established through prior pressure tests. The MAOP validation for these lines was completed in August 2011. For all remaining pipelines located in HCAs (those which had prior pressure tests, or were recently identified due to a class location change), records collection and MAOP validation were completed in January 2012. In total, validation was performed for all 2,088 miles of pipeline located in HCAs. PG&E submitted several filings to the CPUC in 2011 and 2012 regarding the progress including the completion of interim milestones associated with these efforts. Attachments P-10-3A through P-10-3E are the reports submitted to the CPUC showing PG&E's progress on this work. Accordingly, PG&E believes that it has successfully completed the actions requested by the NTSB under P-10-3. In order to comply with CPUC Decision 11-06-0017, PG&E is continuing work to validate all remaining transmission lines in non-HCAs which consists of more than 4,600 miles and is estimated to be completed by early 2013. Through April 2012, PG&E completed validation of 1,032 miles of non -HCA pipelines.

Addressee Acronym: PG&E

Addressee Organization Type: P-Private Industry

Communication Date: 2011-12-22

Communication Type: Official Correspondence

Communication Contents: -From Christopher P. Johns, President: Pacific Gas and Electric Company (PG&E) has fully embraced the safety recommendations outlined by the National Transportation Safety Board (NTSB) as part of the agency's review of the September 2010 San Bruno pipeline accident. We at PG&E recognize the importance of preventing a tragedy like this from ever happening again, and we are grateful for the NTSB's guidance toward that goal. As requested in your September 26, 2011 letter, we are providing an update on the actions PG&E is taking, and the plans that are in place to implement the NTSB's thoughtful and thorough recommendations. These recommendations have prompted PG&E to take significant actions on many fronts, including pipeline leak and break identification, emergency response, integrity management, threat assessments, public awareness of pipeline safety measures, and recordkeeping. The NTSB's recommendations have helped propel PG&E to make fundamental changes to our operations and management-all intended to underscore our commitment to putting public and employee safety first. For example, we've completed Maximum Allowable Operating Pressure validation of more than 1,600 miles of high consequence area pipelines, with plans to complete all 2,000 miles by the end of January 2012. We are implementing a new data management system intended to address the NTSB's recommendations for traceable, verifiable and complete records. Additionally, PG&E has automated 11 shutoff valves in 2011. As part of the company's Pipeline Safety Enhancement Plan, which was presented for approval to the California Public Utilities Commission this year, PG&E has proposed automating a total of 228 valves through 2014. We've also updated our emergency response plans to reflect industry best practices and have begun training employees, public officials and first responders. In an effort to improve public gas safety awareness, we've mailed more than two million safety information letters to customers who live within 2,000 feet of a transmission pipeline. We realize we still have much to learn and do in the wake of the tragic San Bruno accident. As you'll see in the attachment, we have completed several of the recommendations and are in mid-stream on the remainder. We're working with urgency to complete all of the recommendations and we remain steadfast in our commitment to safety and to regaining the trust of the public and our regulators. The attachment to this letter provides a more detailed summary of each NTSB recommendation and the steps we are taking to act upon them. If you have any questions, please contact me directly. • PG&E met its June, July and August CPUC deadlines related to records verification and MAOP validation of 760 miles of pipeline in HCAs • More than 1600 miles of pipeline in HCAs in PG&E's service territory have undergone records verification and MAOP validation. • PG&E is on track to complete records verification and MAOP validation for all pipelines in HCAs (estimated to be more than 2,000 miles) by the end of January 2012. • In 2011, PG&E hydrostatically tested, replaced or verified strength test pressure records for about 144 of the 152 Priority 1 transmission pipeline miles with similar characteristics to the line that failed in San Bruno. • A total of 163.6 miles was tested in 2011. • PG&E plans to hydrostatic pressure test approximately 185 miles in 2012, 204 miles in 2013 and 158 miles in 2014.