NTSB Safety Recommendation P-11-029

NTSB safety recommendation P-11-029.

TO PACIFIC GAS AND ELECTRIC COMPANY: Assess every aspect of your integrity management program, paying particular attention to the areas identified in this investigation, and implement a revised program that includes, at a minimum, (1) a revised risk model to reflect the Pacific Gas and Electric Company’s actual recent experience data on leaks, failures, and incidents; (2) consideration of all defect and leak data for the life of each pipeline, including its construction, in risk analysis for similar or related segments to ensure that all applicable threats are adequately addressed; (3) a revised risk analysis methodology to ensure that assessment methods are selected for each pipeline segment that address all applicable integrity threats, with particular emphasis on design/material and construction threats; and (4) an improved self-assessment that adequately measures whether the program is effectively assessing and evaluating the integrity of each covered pipeline segment.

Priority: CLASS II

Overall Status: Closed - Acceptable Action

Issued Date: 2011-09-26

Adopted Date: 2011-09-12

Overall Date Closed: 2013-11-14

Synopsis: On September 9, 2010, about 6:11 p.m. Pacific daylight time,1 a 30-inch-diameter underground natural gas transmission pipeline (which is identified by the company as Line 132), owned and operated by Pacific Gas and Electric Company (PG&E), ruptured in a residential area in San Bruno, California. The accident killed eight people, injured many more, and caused substantial property damage. The rupture on Line 132 occurred near mile point 39.28, 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 released natural gas was ignited after the rupture; the subsequent explosion created a crater about 72 feet long by 26 feet wide, and the resulting fire destroyed 38 homes and damaged 70. A ruptured pipe segment about 28 feet long was found about 100 feet away from the crater.

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: 2013-11-14

Addressee Acronym: PG&E

Addressee Organization Type: P-Private Industry

Communication Date: 2012-03-13

Communication Type: Official Correspondence

Communication Contents: We note that PG&E has initiated the requested review of its integrity management program. Accordingly, Safety Recommendation P-11-29 is classified OPEN—ACCEPTABLE RESPONSE, pending completion of these efforts and implementation of the revised program.

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 PG&E completed enhancements to its IM program by revising its risk model and integrity management program and by implementing information systems to ensure that all applicable threats are adequately addressed. PG&E planned to have converted its paper records and databases documenting gas transmission leak history into a single electronic database by mid-2012, including all documents designed to identify and report historical weld seam leaks. PG&E retained a consultant to provide an updated internal corrosion and a stress corrosion threat identification procedure to be integrated into PG&E’s Transmission IM program in mid-2012 and to issue recommendations that PG&E plans to implement in 2012 and 2013. Pending completion of this work, Safety Recommendation P-11-29 is classified OPEN—ACCEPTABLE RESPONSE.

Addressee Acronym: PG&E

Addressee Organization Type: P-Private Industry

Communication Date: 2012-02-06

Communication Type: Official Correspondence

Communication Contents: Correspondence control 201200077 was closed administratively. It was combined with correspondence control 201100506. The reply to 201200077/ 201100506 was mailed on 3/13/2012.

Addressee Acronym: PG&E

Addressee Organization Type: P-Private Industry

Communication Date: 2013-11-14

Communication Type: Official Correspondence

Communication Contents: We are pleased that PG&E has completed the assessment of and revised its IM program, which now includes an updated risk model and risk assessment methodology, consideration of all defect and leak data for the life of each pipeline, and an improved self assessment process. We are also pleased that PG&E updated 11 risk management procedures and added 4 new procedures. These actions satisfy Safety Recommendation P-11-29, which is classified CLOSED—ACCEPTABLE ACTION.

Addressee Acronym: PG&E

Addressee Organization Type: P-Private Industry

Communication Date: 2012-01-27

Communication Type: Official Correspondence

Communication Contents: -From Christopher P. Johns, President: Pacific Gas and Electric Company (PG&E) fully embraces the safety recommendations outlined by the National Transportation Safety Board as part of the agencies review of the 2010 San Bruno pipeline accident. We recognize the importance of preventing a tragedy like this from occurring again and that is why we are committed to successfully implementing the NTSB's recommendations. To date, PG&E has taken numerous actions to make fundamental changes to our operations and management -all with a focus on putting public and employee safety first. In response to your September 26, 2011 letter, PG&E sent to you on December 22, 2011, an update on the progress we have made toward implementing the recommendations and the plans we have in place. This letter included an update on activities related to integrity management, emergency response, public awareness, threat assessment and recordkeeping, among other aspects of our operations and management. Since that time, members of our team have had the opportunity to meet with NTSB technical staff to discuss our submission and review our activities. We are grateful for the guidance and feedback provided at that meeting. As a result of those discussions, we recognize that it is incumbent upon us to provide a greater level of detail than was previously provided in the December 22, 2011 update. Therefore, we would like to take the opportunity to supplement our December 22, 2011 response by providing an amended response with the requisite detail within 45 days. PG&E will continue to meet with NTSB staff in the coming weeks to seek additional guidance to ensure that the update we provide is fully responsive and will allow the NTSB to more ably assess our progress and plans.

Addressee Acronym: PG&E

Addressee Organization Type: P-Private Industry

Communication Date: 2013-06-18

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 taken to complete the NTSB's recommendations for PG&E's Integrity Management Program (P-11-29 and P-11-30). PG&E met with the NTSB staff on May 28, 2013, to provide an update on the completion of these recommendations and the processes in place to support continuous improvement of PG&E's integrity management program. PG&E has completed the assessment of every aspect of its Integrity Management Program (P-11-29) and implemented a revised program that includes: a revised risk model; consideration of all defect and leak data for the life of each pipeline; a revised risk assessment methodology; and an improved self-assessment process. As part of this work, PG&E updated eleven risk management procedures and added four new procedures. For the recommendations on Threat Assessment (P-11-30), PG&E has completed conducting the threat assessments using the revised risk analysis methodology as described in Recommendation P-11-29 and finalized the 2012 HCA Assessment Plan on April29, 2013. PG&E provided the results of those assessments to the California Public Utilities Commission and the Pipeline and Hazardous Materials Safety Administration on June 10, 2013. The attached status report provides additional details of the actions PG&E has taken to address these recommendations. PG&E requests the NTSB to close Safety Recommendations P-11-29 and P-11-30 with acceptable action. 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. P-11-29: Integrity Management Program Assess every aspect of your integrity management program, paying particular attention to the areas identified in this investigation, and implement a revised program that includes, at a minimum, 1) a revised risk model to reflect the Pacific Gas and Electric Company’s actual recent experience data on leaks, failures, and incidents; 2) consideration of all defect and leak data for the life of each pipeline, including its construction, and risk analysis for similar or related segments to ensure that all applicable threats are adequately addressed; 3) a revised risk analysis methodology to ensure that assessment methods are selected for each pipeline segment that address all applicable integrity threats, with particular emphasis on design/material and construction threats; and 4) An improved self-assessment that adequately measures whether the program is effectively assessing and evaluating the integrity of each covered pipeline segment. Update for P-11-29: PG&E has completed the assessment of every aspect of its Integrity Management Program and implemented a revised program that includes: a revised risk model; consideration of all defect and leak data for the life of each pipeline; a revised risk assessment methodology; and an improved selfassessment process. PG&E completed this work with help from several leading integrity management consultants and has implemented numerous enhancements to its program. Exhibit 1 is a letter from Det Norske Veritas (DNV) which provides an executive summary of the review completed on PG&E’s integrity program. In addition, PG&E worked with Kiefner & Associates to update the threat identification processes for manufacturing and construction threats, cyclic fatigue and interactive threats. Exhibit 2 through 4 include the reports from Kiefner & Associates detailing the work performed. Based upon these efforts, PG&E updated eleven of its risk management procedures including its Integrity Management Program (RMP-6) and added four new procedures. To ensure all applicable threats are addressed, PG&E enhanced its threat identification procedures and completed an extensive data gathering effort on its historic leakage records to assure consideration of all defect and leak data for the life of each pipeline, including construction, and risk analysis for similar or related segments. PG&E also revised it’s risk analysis methodology to ensure assessment methods are selected for each pipeline segment that address all applicable integrity threats, specifically focusing on design, material and construction threats. PG&E documented these changes to the existing integrity management procedures through a change form process. PG&E is providing a copy of these change forms as documentation of the changes it performed to its program (RMP 1-6, 8-11, 13 and 16) as provided in Exhibit 5. In addition, PG&E is providing a complete copy of its revised procedures including the four new procedures it established as part of its overall evaluation it completed in 2012 (Exhibit 6). The revised organizational structure of PG&E’s program documents is shown in Figure 1 below. To assure that the integrity related procedures are maintained and continuously improved, each procedure is tracked in PG&E’s document tracking system and has been scheduled for an annual review. Furthermore, PG&E continues to improve its record keeping systems and is addressing data quality through the MAOP Data Validation Project. Attached is a quality assurance document that was shared with the CPUC on April 9, 2013 which details PG&E data quality efforts (Exhibit 7). In addition, the leak verification project was established to integrate historic leak records into an electronic repository so that improved integrity decision making could be performed and incorporated into this year’s risk algorithm. PG&E has also updated its procedure to address how it selects assessment methods. This updated methodology is listed in RMP 6, Section 9. NEW PROCEDURES RMP-16, ‘Threat Identification,’ was created to focus on PG&E’s threat identification process. PG&E has aligned its pipeline threats nomenclature for the nine threat categories with Industry best practices and decision trees have been created to identify each threat. Within RMP-16, improvements have been made to PG&E’s threat identification processes. Some of these changes include: • Consideration of liquid water, water vapor, and corrosive sources in the internal corrosion threat identification process. Increased reliance on internal corrosion related leak and inspection data to evaluate the threat. • Separate manufacturing threat identification procedure for seam and body of pipe. • Addition of a stability determination evaluation process for manufacturing threats based upon post construction pressure testing. • Enhanced procedures to address interactive threats including cyclic fatigue. • Added consideration of near-neutral stress corrosion cracking as a threat. • Improved threat identification procedures for equipment and incorrect operations threat. The other new procedures address the following: • RMP-17 - post assessment process • RMP-18 - establishment of a direct examination procedure • RMP-19 - enhancements to the risk algorithm RISK MODEL PG&E has completed the implementation of a revised risk model to reflect actual recent experience data on leaks, failures, and incidents (documented in changes to the procedures related to risk (RMP 1-5, RMP 19) in 2012). The results from the model were published in PG&E’s latest Assessment Plan which was approved on 4/29/2013 for PG&E. PG&E’s revised Risk Algorithm is as follows: ________________________________________________________________________ Likelihood of Failure = EC + IC + SCC + TPD + WROF + M&C + E + IO Where: EC = External Corrosion Threat IC = Internal Corrosion Threat SCC = Stress Corrosion Cracking Threat TPD = Third Party Threat (Including 1st and 2nd party threat) WROF = Weather &

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. 1) Revised Risk Model: A revised risk model to reflect the Pacific Gas and Electric Company's actual recent experience data on leaks, failures, and incidents PG&E has completed the implementation of a revised risk model to reflect PG&E's actual recent experience data on leaks, failures and incidents. This work is performed at a minimum annually and was approved on March 26, 2012 (based upon updated HCA analysis and risk assessment performed on data collection through the end of 2011). This revision included changing the weighting of the risk factors of the existing threats in the risk algorithm to better reflect risk and threats related to long seam information and historical leak, failure and incident records that have been revealed through the extensive data collection efforts performed by the MAOP Validation efforts and feedback from PG&E's outside experts in risk assessment. Attachment P-11-29 Risk Management includes the documents that outline the changes made to implement the NTSB recommendations. 2) Risk Analysis Considerations: Consideration of all defect and leak data for the life of each pipeline, including its construction, and risk analysis for similar or related segments to ensure that all applicable threats are adequately addressed After review and consideration of all defect and leak data for the life of each pipeline by PG&E's subject matter experts and Contractor, Det Norske Veritas (DNV), the revised risk model was approved by PG&E and the associated Risk Management Procedures were updated to reflect these changes. PG&E has developed its risk model to enhance consideration of stress corrosion cracking, internal corrosion, equipment and incorrect operations as threat terms in the overall risk algorithm and the results of the applied risk analysis will be published in the 1st quarter of 2013. Centralized access to all data for PG&E's gas transmission pipeline assets, such as defect and leak data will be provided through the development of Mariner. The Mariner Project (referenced as GTAM in the May 2012 status report) is a four-year program designed to enhance the safety of PG&E's gas system by dramatically improving our ability to access verifiable, traceable and complete gas transmission pipeline information through core integrated systems. Mariner initiatives are focused on moving the Gas Operations organization away from reliance on paper records and towards robust electronic data management systems. The program will enhance safety by implementing improved capabilities in three key areas: work processes, data and records, and decision making. In late 2012, PG&E uploaded the validated and spatially enabled Transmission Leak Forms data into GIS, which provided Integrity Management access to this data for use in assessing risks and the data will be available across the company. Over the long-term, the plan is to migrate this information from GIS to SAP to better align with PG&E's overall data management strategy. There will be a phased pilot that will start the migration of data to SAP in January 2013, and phased in over several months. PG&E's goal is to have all consolidated leak information migrated by June 2013. 3) Revised Risk Analysis Methodology: A revised risk analysis methodology to ensure that assessment methods are selected for each pipeline segment that address all applicable integrity threats, with particular emphasis on design/material and construction threats PG&E has completed the implementation of a revised risk analysis methodology to ensure that assessment methods are selected for each pipeline segment that address all applicable integrity threats, with particular emphasis on design/material and construction threats. PG&E incorporated these procedures and analysis tools into its Integrity Management Program in 2012. PG&E's updated internal corrosion and stress corrosion cracking threat identification procedures were integrated into PG&E's Transmission Integrity Management Program during the 3rd quarter of 2012. (Attachment P-11-29 Risk Management, RMP-16, Rev 0) In addition to the procedures that already existed for external corrosion, third party damage, incorrect operations, weather, and outside force and equipment threats, PG&E established new threat identification procedures for the following threats: • Manufacturing • Construction • Internal Corrosion • Stress Corrosion Cracking • Interacting Threats (including cyclic fatigue) PG&E will use this information as an input to developing its asset management plans, life cycle investments, and in implementation of its asset

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. PG&E has embarked on a complete assessment of every aspect of its transmission integrity management program. At the core of this effort is a major restructuring of the personnel responsible for implementing the program. PG&E has established a team solely dedicated to transmission integrity management and whose sole focus will be to manage the integrity of the company's transmission assets. In addition, PG&E has hired a number of consultants recognized and respected in the industry as experts in integrity management to assist in an exhaustive review of its program's policies, procedures and tools. This review was conducted in close coordination and collaboration with PG&E in order to assure that PG&E's updated integrity management program meets all regulatory requiren1ents, utilizes industry accepted practices, and leverages technical knowledge and experience from outside consultants to drive PG&E's program forward to improve both public safety and system reliability. The results of this review will be the basis for proposed modifications and improvements to the PG&E pipeline integrity management documents and the development of an implementation plan that outlines steps PG&E will take to exhibit all the attributes required for “Exceptional Performance" status as defined by 49 CFR 192. The review and implementation plan is expected to be available by mid-2012. Following are additional actions PG&E has completed or is undertaking to enhance its Integrity Management Program: 1. Revised Risk Model and Integrity Management Program PG&E updated its risk model to support the 2011 "Baseline Assessment Plan" in March 2012. This work is performed at a minimum of one time a year and was approved on March 26,2012 based upon updated HCA analysis and risk assessment performed on data collection through the end of 2011. This revision included changing the weighting of the risk factors of the existing threats in the risk algorithm to better reflect risk and threats related to long seam information and historical leak records that have been revealed through the extensive data collection efforts performed by the MAOP Validation Efforts (P-10-3) and feedback 'from PG&E's consultants. After review by PG&E's internal Threat Steering Committee, the revised risk model was approved by PG&E Management and the associated Risk Management Procedures were updated to reflect these changes. However, this work is not complete. PG&E will further develop its risk model to improve its consideration of stress corrosion cracking, internal corrosion, equipment and incorrect operations as threat terms in the overall risk algorithm. This is expected to be completed in 2012 and the results published in the 1st quarter of 2013 as part of the 2012 risk assessment. In addition to the algorithm development, PG&E is actively working to improve its Integrity Management Program. Based upon recommendations received from its consultants and other relevant stakeholders, PG&E is revising its program and will update almost every procedure in PG&E's Integrity Management Program. The majority of this work is expected to be completed by August of 2012. 2. Information Systems To Ensure All Applicable Threats Are Adequately Addressed PG&E is working to improve system records and work management systems to fully integrate the use of pipeline system as-built and maintenance information into the Integrity Management Program. A key initiative included in PG&Es Pipeline Safety Enhancement Plan submitted to the CPUC on August 26,2011 is the Gas Transmission Asset Management Plan (GTAM). The project will substantially enhance and improve: the amount and the types of information that PG&E collects and maintains electronically about its pipeline system; the business processes for collecting, validating and retaining pipeline data; the traceability of materials used in the construction and maintenance of PG&E's natural gas transmission pipelines; and PG&E's ability to assess and mitigate potential public safety risks. The project establishes a technology infrastructure that supports enhanced new business processes to ensure data reliability is maintained and enables improved decision making capabilities related to the risks and integrity: of the gas transmission system. By completing the objectives, PG&E will provide the complete and accurate pipeline information necessary to establish and sustain an effective GIS and data process for PG&E's integrity management program. There are four primary objectives of the project: • All asset data (location/connectivity, specification/features, and maintenance/inspection history) are tracked, managed, and stored using a software product and data management technique called linear referencing, which is a best practice for viewing/analyzing pipeline features, characteristics, and event history relative to specific reference points along the entire length of gas transmission pipelines. • Materials are tracked in a traceable chain from receipt by PG&E through the operating life of the component. Key features that would be tracked include the manufacturer, characteristics of the component, manufacturer ratings, and factory test results. • Work management and data capture pertaining to maintenance and inspection processes (including Mark and Locate and Leak Survey) are more efficient, accurate, timely, and complete with rigorous quality assurance embedded. This will be accomplished by eliminating paper-based maintenance and inspection work processes and implementing automated w

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 has embarked on a complete assessment of every aspect of its integrity management program. At the core of this effort is a major restructuring of the organization responsible for the program. A key aspect of the reorganization is the formation of a team solely dedicated to integrity management associated with the company's transmission assets. In addition, PG&E has hired a number of consultants recognized and respected in the industry as experts in integrity management to assist in an exhaustive review of our program's policies, procedures and tools. Also, we are working collaboratively with the newly formed Asset Knowledge Management group to improve system records and work management systems to fully integrate the use of pipeline system as-built and maintenance information into the revitalized integrity management program. This work includes: 1. Revisions to PG&E's risk model are being initiated to include a more comprehensive integration of leak history, failure analysis and incident investigations. 2. Risk analysis algorithms are foundational to PG&E's risk analysis methodology. These tools are being enhanced through engagement of several consultants who will further evaluate various threats including: internal corrosion, stress corrosion cracking, manufacturing, construction and cyclic fatigue failure threats 3. Developing aids for selecting assessment methodologies to ensure that all applicable integrity threats are being considered for each pipeline segment which include human performance errors, with particular emphasis on design/material and construction threats. 4. Developing public safety metrics that include performance measures of the integrity management program. Two audits of PG&E's Transmission Integrity Management Program (TIMP) were conducted during 2010 and 2011. Preliminary results of these audits are as follows: • 2010 TIMP California Public Utilities Commission (CPUC) Audit o PG&E's TIMP program was audited by the CPUC in May 2010. The scope of the two week audit was the Pipeline and Hazardous Materials Safety Administration (PHMSA) TIMP audit protocols. The CPUC letter and findings were issued in Oct. 2010. PG&E responded in Dec. 2010 and committed to 41 corrective actions in response to their findings. o Forty of the 41 corrective actions have been completed. The remaining outstanding action will be completed by the end of 2011. • 2011 TIMP CPUC/PHMSA Audit o PG&E's TIMP program was audited by the CPUC and PHMSA in April 2011. The scope of this four day audit was PHMSA Protocol C, which is risk and threat identification. PG&E has not received a final letter yet.