Dive Brief:
- Pacific Gas & Electric (PG&E) should be fined at least $1 million and have strict limits placed on its communications with members of the California Public Utilities Commission (CPUC), a CPUC law judge and commissioner proposed on Thursday.
- Under the proposed sanctions, PG&E would only be allowed to communicate with CPUC commissioners and their advisers at official public meetings for one year. The penalties come in response to the recent disclosure of a host of emails showing improper communications between PG&E and CPUC employees.
- The full CPUC must now make a final decision on sanctions, which could come at its Nov. 20 meeting.
Dive Insight:
The proposed sanctions are the latest installment in a scandal that began with improper ex parte communications between the utility and regulators after the 2010 explosion of a gas pipeline in San Bruno. The blast killed eight people and leveled a neighborhood.
After the blast, emails showed that PG&E executives allegedly conspired with CPUC officials to shop for a friendly judge in the explosion case. Other correspondences reveal similar alleged collusion during the utility's last gas storage and rate case. One message gave a summary of a dinner conversation between a fired PG&E Vice President and CPUC President Michael Peevey during which Peevey gave the company public relations advice and requested that they donate to certain political causes.
Since the emails became public, three PG&E executives have been fired, Peevey announced he will step down, and a federal investigation has been opened into the communications.
Some critics want to see the CPUC punished along with PG&E. State Sen. Jerry Hill in particular, whose district contains San Bruno, says the regulators are at fault as well.
"It takes two to tango," Hill said, according to the San Jose Mercury News. "But what about the two PUC commissioners, Michael Peevey and Michael Florio, who allowed these communications to happen? The commissioners are equally guilty."
