Tags: California | Regulator | PG&E | E-Mails

PG&E: US Attorney Investigating E-Mails With Regulator

Tuesday, 07 October 2014 08:15 AM

California Governor Jerry Brown’s campaign said he returned $9,000 in contributions from PG&E Corp. executives as the utility reported it’s under federal investigation for improper communications with regulators at the California Public Utilities Commission.

The owner of California’s largest utility also released e-mails showing that a commissioner had alerted the company in December that Dana Williamson, who was PG&E’s director of public affairs until she became a senior adviser to the governor, might become involved in negotiations with the company over natural gas-delivery.

Returning the donations “seemed prudent due to the inquiry,” said Dan Newman, a spokesman for Brown’s campaign, which reported cash on hand of $23.6 million. The e-mails show that Williamson asked the PUC commissioner appropriate questions about safety concerns, said Jim Evans, a spokesman for the governor.

The commission will vote whether to impose a $1.4 billion penalty against the company for a 2010 natural-gas explosion that killed eight people in San Bruno, California. The commission hasn’t set a date for a vote on the fine, which has been appealed by the company and other parties.

Four of the five commission members are Brown appointees. The fifth, commission President Michael Peevey, the former president of Southern California Edison Co., was appointed by former Governor Gray Davis. Peevey has said he will recuse himself from penalty proceedings because of “inappropriate e-mail exchanges” with the company.

$2,000 Gifts

The donations from six utility officials were returned Aug. 13, according to campaign finance records filed Monday, and included $1,000 from Brian Cherry, vice president of regulatory relations. Cherry was fired last month over communications with the commission.

Giving $2,000 each were Kent Harvey, PG&E’s chief financial officer; Greg Pruett, senior vice president of corporate affairs until his retirement in August, and Karen Austin, chief information officer.

A PG&E spokesman didn’t immediately respond to a call seeking comment on the donations after regular business hours.

Brown’s return of the donations was included in campaign finance filings the same day that PG&E said the U.S. Attorney in San Francisco is investigating e-mails with the utilities commission that may show it violated rules on communicating directly with regulators.

The e-mails reported by PG&E include correspondence about the safety of a high-pressure gas pipeline that runs under the city of San Carlos, about 24 miles (39 kilometers) south of San Francisco. San Carlos is about 14 miles from San Bruno.

Pipeline Emergency

In October 2013, San Carlos declared a state of emergency after discovering e-mails from PG&E inspectors who had raised concerns about the safety of the pipeline. A state superior court judge in San Mateo ordered the line shut based on the assertions.

PG&E complied with the order and reduced pressure on the line. The utility said the line was safe and asked the commission for an order to restore pressure; a staff study agreed. E-mail exchanges between PUC Commissioner Mike Florio and Cherry show them corresponding on how to deal with San Carlos officials, who didn’t want pressure restrictions lifted.

“We want to go ahead but now the governor’s office is asking if we can somehow ‘compromise’ with the city on 240 psi, which is the number they think they can live with,” Florio said Dec. 18 in an e-mail to Cherry, referring to San Carlos and the pounds per square inch of pressure on the line.

In response, Cherry said PG&E couldn’t operate its system to serve customers with its line at the lower pressure and needed authorization for 330 pounds per square inch.

‘Warn Him’

“Dana Williamson from the Gov’s office may be calling Tony to ask similar questions, so you should probably warn him,” Florio replied. “Nothing like trying to ‘fix’ things the day before the meeting!! Let sanity prevail.”

Williamson served as PG&E’s public affairs chief from 2006 to 2011, when she joined Brown’s staff as senior special advisor to the governor. She was promoted to cabinet secretary in 2013.

“The e-mails show that administration staff asked a PUC commissioner appropriate questions regarding safety concerns that had been raised by the city of San Carlos,” Brown spokesman Evans said in response to questions.

In an e-mail, Florio remarked to Cherry, “Amazing how I’ve become ‘an apologist for PG&E’ in just three short years, isn’t it?” Florio was appointed to the PUC in 2011.

Florio said he put the term between quote marks because he expected people might accuse him of being an apologist, not because he considered himself one.

‘Right One’

“After hearing what San Carlos had to say and what PG&E had to say, I made my decision, which I continue to think was the right one,” Florio said by telephone Oct. 5.

On Dec. 19, a day after Florio informed Cherry of the governor’s inquiry, the commission voted to allow PG&E to restore full pressure to the San Carlos line of as much as 330 pounds per square inch. The commission also fined PG&E $14.4 million for failing to promptly notify it of incorrect records related to the gas pipeline.

PG&E Chairman and Chief Executive Officer Tony Earley said the utility had asked the company’s board of directors for an independent review of its actions. The review was prompted by former utilities Commissioner Mark Ferron’s assertion of “deliberate and calculated dishonesty” by PG&E related to safety reporting.

PG&E faces as much as $1.13 billion in federal fines in connection with the San Bruno pipeline blast. The company pleaded not guilty to 27 counts of knowingly and willfully violating pipeline safety regulations and obstructing a federal investigation by the National Transportation Safety Board. PG&E has said its employees didn’t intentionally violate the law.

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California Governor Jerry Brown's campaign said he returned $9,000 in contributions from PG&E Corp. executives as the utility reported it's under federal investigation for improper communications with regulators at the California Public Utilities Commission.
California, Regulator, PG&E, E-Mails
Tuesday, 07 October 2014 08:15 AM
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