The commission has approved a settlement agreement between Puget Sound Energy, the City of Bellevue and the UTC pipeline safety staff in Olympia.

Read the legal narrative supporting this settlement.

The settlement agreement presents PSE’s proposed plan to address the results of PSE’s assessment of older (pre-1972) steel pipelines. The assessment was ordered by the UTC following a fatal house explosion in Bellevue in 2004.

Among the terms of the settlement is PSE’s agreement to replace approximately 9,000 natural gas service lines in Western Washington by the end of 2010, and to continually assess older service lines in its system to identify any potentially vulnerable gas lines before they become a safety risk. Some of the natural gas service lines not slated for replacement will be checked for leaks on a more frequent basis than currently required by state safety regulations. In addition, the company has agreed to test for potential corrosive pipe conditions on at least 1,000 randomly-selected service lines from its least vulnerable pre-1972 steel service lines.

The assessment was part of an an earlier agreement between Puget Sound Energy, the city of Bellevue and the UTC. As part of that settlement, PSE paid a $90,000 penalty and agreed to conduct an assessment of all of its coated steel service lines installed more than five years prior to the use of cathodic protection systems. Cathodic protection systems protect pipelines against corrosion and have been mandatory for new natural gas pipelines installed since 1972. Later, the company agreed that it was simpler and more comprehensive to assess all wrapped steel pipe (roughly 100,000 services) installed before 1972.

The expert technical consultant for the UTC pipeline safety staff, who assisted in the investigation of the incident, concluded that the explosion was caused by long-term corrosion resulting from the coated-steel pipe being in the ground for roughly 19 years before cathodic protection was installed. The leaking gas from the corroded pipe found its way into the home of Frances Schmitz and ignited. Schmitz, 68, died from injuries sustained in the explosion.

Staff contended that PSE's cathodic protection system was wired incorrectly for five days leading up to the explosion. However, according to staff’s expert, the mis-wiring was temporary and not the cause of the natural-gas leak. The settlement requires PSE to adopt several new procedures to ensure that its cathodic protection system operates correctly.