The Washington Utilities and Transportation Commission (WUTC) approved (Jan. 31, 2005) an agreement that calls for Puget Sound Energy (PSE) to pay a $500,000 fine and to carry out an extensive 10-year program to identify and replace any aging natural-gas pipelines in the company’s Western Washington service territory.

“The settlement agreement calls for penalties in a significant amount – in this instance, the highest penalty that the commission has ever assessed for pipeline-safety violations and one of the highest it has ever assessed for any violations,” said the three-member commission in its written decision. “The penalties are of an amount, and imposed in a way, to provide true incentives to compliance and to the level of safety to which both commission and the company agree are essential.”

Under the terms of the settlement, all issues in a complaint filed by the WUTC's pipeline-safety program on June 29, 2004 are resolved by this decision. The company admitted committing 67 violations of state pipeline-safety regulations. The complaint stems from inspections conducted of PSE facilities in Pierce and King counties during 2003.

An additional $200,000 penalty is suspended pending the company’s compliance with the terms of the settlement. The commission is requiring PSE to take the following actions:
1) Enhance computer programs to provide the company with accurate and timely pipeline inspection and maintenance schedules.
2) Identify, locate and if necessary, fix or replace certain sections of steel pipe that is not currently protected against corrosion.
3) Locate and replace bare steel pipe on a 10-year schedule that is completed by 2014. PSE estimates there are about 200 miles of this pipe system wide.

Nothing in the agreement prevents the WUTC’s pipeline safety staff from conducting additional inspections and investigations of PSE’s facilities and safety practices. If future violations are identified dealing with issues that PSE is currently addressing under this order, the company must fix the problem. The WUTC staff agrees not to pursue penalties unless serious injury or property damage results from the infraction.

The WUTC's pipeline safety program performs public-safety inspections on the state’s 21,000 miles of natural gas and hazardous liquid pipelines. Bellevue-based Puget Sound Energy, the state’s largest electric and natural-gas utility, provides natural-gas service to 660,000 customers in Snohomish, King, Pierce, Thurston, Lewis and parts of Kittitas counties.