Natural gas company UGI Utilities Inc. will pay a $500,000 fine and accelerate its plans to replace aging cast-iron gas pipes, Pennsylvania Public Utility Commission officials said.
The fine comes after the February 2011 Allentown gas explosion that killed five people and destroyed eight homes. The utility commission ruling carries the maximum civil penalty allowed by law.
“The UGI Companies know that it is our responsibility to safely and reliably serve customers,” said UGI Utilities President Robert Beard in a letter to the commission. “UGI is committed to proactively managing and addressing the many significant operational challenges that confront natural gas distribution businesses generally and ours in particular.”
A cast-iron main installed in 1928 beneath Allen Street cracked, causing the Feb. 9, 2011, explosion in the 500 block of North 13th Street.
After a 16-month investigation, the utility commission found a UGI work order from December 1979 recommended the pipe for a replacement that never happened.
The commission ordered in addition to a $500,000 fine, UGI must replace all cast-iron pipelines in its service territory over 14 years, and all bare-steel pipelines over 30 years.
In accepting the terms and conditions of the utility commission’s order today, UGI has effectively agreed not to fight the finding, which they could have appealed to the Pennsylvania Commonwealth Court.
UGI had been on a 50-year replacement schedule before the explosion.
The commission in June filed a complaint alleging UGI violated 178 safety regulations leading up to the explosion.
The commission concluded UGI failed to properly monitor its facilities, did not respond to signs the pipeline needed repairs and found flaws in the company’s pipeline replacement program. The utility contested claims in the state commission’s finding.
The gas explosion killed Ofelia Ben, 69; Katherine Cruz, 16; Matthew E. Vega, 4 months; and William Hall, 79, and Beatrice Hall, 74.
The Public Utility Commission also requires UGI to seek the utility regulator’s approval of a pilot program for testing enhanced gas leak detection measures in Allentown, update its management plan for gas distribution system integrity and supply a schedule for meeting gas main replacement requirements outlined in the settlement.