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Dominion East Ohio fined $500,000 by the PUCO

Dominion East Ohio fined $500,000 by the PUCO

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Published by The News-Herald
Dominion East Ohio gas company was fined $500,000 by the Public Utilities Commission of Ohio for its role in a 2011 explosion and series of fires in Fairport Harbor.
Dominion East Ohio gas company was fined $500,000 by the Public Utilities Commission of Ohio for its role in a 2011 explosion and series of fires in Fairport Harbor.

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Categories:Types, Business/Law
Published by: The News-Herald on Dec 12, 2012
Copyright:Attribution Non-commercial

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12/12/2012

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BEFORETHE PUBLIC UTILITIES COMMISSION OF OHIOCase No. 12-380-GA-GPSIn the Matter of the Investigation of The )East Ohio Gas Company d/b/a )Dominion East Ohio Relative to Its )Compliance with the Natural Gas )Pipeline Safety Standards and Related )Matters. )FINDING AND ORDERThe Commission finds:(1) The East Ohio Gas Company d/b/a Dominion East Ohio(DEO or the Company) is a public utility and a natural gascompany within the meaning of Sections 4905.02, 4905.03,and 4905.90, Revised Code, and is, therefore, a publicutility and an operator subject to the ongoing jurisdictionand supervision of the Commission, pursuant to Sections4905.02, 4905.04, 4905.05, 4905.06, and 4905.90 through4905.96, Revised Code. Accordingly, DEO is required tocomply with the minimum gas service standards found inChapter 4901:1-13, Ohio Administrative Code (O.A.C), aswell as the gas pipeline safety (GPS) rules contained inChapter 4901:1-16, O.A.C, which set forth the safetystandards and requirements for intrastate gas pipelinefacilities subject to the Commission's jurisdiction. Pursuantto Rule 4901:1-16-03(A), O.A.C, the GPS rules incorporatethe United States Department of Transportation's GPSregulations, as contained in 49 Code of Federal Regulations(CF.R.) Parts 40,191,192, and 199.(2) On January 23, 2012, Staff filed a report detailing the resultsof its investigation into DEO's compliance v^th the GPSrules following a series of fires that occurred in the villageof Fairport Harbor, Ohio, on January 24, 2011. Accordingto the report, 11 homes were severely damaged and 150homes required appliance repair or replacement from whatwas identified as a major gas leak, causing an estimatedproperty damage of nearly $1,300,000, and, thus, meetingthe definition of an incident, pursuant to Rule 4901:1-16-01(G), O.A.C., and 49 CF.R.
191.3.
 
12-380-GA-GPS -2-(3) Staff reports that the subsequent investigation revealed thattwo low pressure regulating devices at the High Streetregulator station in Fairport Harbor had failed due to thepresence of pipeline fluids in the devices, which caused thepressure in the system to increase beyond the set point.The increased pressure resulted in damage to customers'appliances and multiple structural fires. Following itsinvestigation. Staff concluded that DEO had violatedseveral sections of 49 CF.R. Part 192, as well as provisionsof the Company's standard operating procedures (SOP)and design and consttuction manual (DCM) related to thedesign and operation of the regulator station.(4) Staff further reports that, on October 20, 2011, Staff issuedDEO a notice of probable noncompliance concerning theviolations below:(a) DEO failed to follow its SOP and DCM in thedesign and operation of the regulator station,in violation of 49 C.F.R. 192.13(c).(b) DEO did not properly operate or design theregulating devices at the regulator station, inviolation of 49 CF.R. 192.619(a)(1), SOPSection 190.01(III)(A), and DCM Section
6.1.1.
(c) DEO did not perform the appropriateinspections and tests necessary to ensure theregulating devices at the regulator stationwere properly installed and protected fromdirt, liquids, or other conditions that mayprevent proper operation, in violation of 49C.F.R. 192.739(a)(4) and SOP Section210.02(II)(C)(4). Additionally, DEO failed toinstall the proper filter system to protect theregulating devices at the regulator station, tnviolation of 49 CF.R. 192.739(a)(4) and DCMSection 6.8(A)(1) and (4). Staff emphasizesthat DEO was aware that pipeline fluids hadpreviously been found in the intermediatepressure regulating devices at the sameregulator station during an inspectionconducted on October 19, 2010.
 
12-380-GA-GPS -3-(d) Although the regulator station was installedin 1999 and should have been inspected atleast once per calendar year, its firstinspection did not occur until October 26,
2009,
in violation of 49 CF.R. 192.739(a) andSOP Section 210.02(II)(B)(1).(e) DEO failed to keep adequate recordsnecessary to administer procedures forappropriate inspection of the regulatorstation, in violation of 49 CF.R. 192.603(b).(5) According to
Staff,
DEO responded to the notice ofprobable noncompliance on November 8, 2011, but did notprovide any additional documentation or evidence todispute Staff's conclusions about the cause of the incident.Additionally, Staff notes that a meeting occurred betweenDEO and Staff on October 12, 2011, to review actions takenby the Company to prevent a recurrence of over-pressurization of the low pressure system due to regulatorfailure. Staff reports that these actions consisted ofcompletion of 452 accelerated inspections of low pressureregulator stations and the identification and redesign ofeight regulator stations found to have a configurationsimilar to the failed regulator station; the inclusion of 287low pressure stations into a program to install remotepressure monitoring and alarm equipment; andstrengthening DEO's fluid management procedures andtraining related to the inspection of production stations forfluid and the enforcement of gas quality standards for localOhio production.(6) hi its report. Staff concludes that DEO violated 49 CF.R.192.13(c), 192.603(b), 192.619(a)(1), 192.739(a), and192.739(a)(4), as well as failed to follow the Company'sowTi plans and procedures for the design and operation ofthe regulator station, which caused the incident in FairportHarbor. Although Staff recognizes that DEO has alreadytaken actions intended to prevent recurrence of a similarincident. Staff makes a number of additionalrecommendations:

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