Southwest Gas agreed to pay a $2 million fine to the Arizona Corporation Commission and upgrade endangered plastic pipes, following a 2021 explosion in Chandler that injured four people.
Explosion at Chandler printing plant near Ray, rural roads
Video footage from Chandler Police shows the explosion at Platinum Printing on August 26, 2021.
Chandler Police Department, Republic of Arizona
Southwest Gas agreed to pay a $2 million fine to the Arizona Corporation Commission and upgrade plastic pipes from the type that failed in 2021, contributing to a explosion that injured four people in Chandler.
Similar pipes were the cause of a leak the same year in Scottsdale.
The Commission approved the civil penalty and consent agreement on a 5-0 vote. The agreement between Southwest Gas and the Commission’s Office of Pipeline Safety resolves the two incidents and requires the Las Vegas-based utility to increase its leak monitoring or “patrols” efforts.
Southwest Gas, which serves about 1.2 million customers in Arizona, said it worked closely with the Office of Pipeline Safety during the investigation to determine what caused the incidents and identify opportunities to improve safety and reliability of Arizona’s infrastructure and improve service.
“The Consent Agreement is the result of these efforts and ensures that the insights gained from this process will lead to positive change that reflects Southwest Gas’ continued commitment to safely delivering natural gas services to our customers and the communities we serve,” the company said in a statement. statement.
State researchers concluded that some plastic pipes are prone to wear and tear in areas such as metro Phoenix, where summer temperatures are high, which can lead to leaks.
They also found that the utility failed to map all the areas where the pipe, Driscopipe polyethylene M7000 and M8000, was located. The mapping errors led to a misunderstanding of where pipes that could potentially fail were located.
The Chandler incident occurred on August 26, 2021 in a strip mall on the northeast corner of Ray and Rural Roads. The leak in a residential area in north Scottsdalehappened a few weeks later, on September 9. The investigators considered both incidents to be accidents.
Southwest Gas accepted responsibility and agreed to pay $2 million to the Commission. Southwest Gas also agreed to replace or eliminate some previously unmapped pipes that could be defective and to notify the office of any new leaks so it can continue to monitor the situation. The utility estimates that more than 10,000 miles of M7000 and M8000 lines have been installed throughout Arizona and has a plan in place to address high-risk portions of the lines.
The company serves approximately 2.2 million customers in Arizona, Nevada and California.
Cities with more pipeline miles include Phoenix (about 2,769 miles), Scottsdale (767 miles), Chandler (400 miles) and Gilbert (376 miles), according to a letter sent to the commission by Matthew Derr, vice president of Southwest Gas. regulations and public affairs.
Much of the pipe was installed in Southwest Gas’ service area between 1974 and 2000. Derr’s letter indicated that less than 1% of Arizona’s pipes are at risk. The highest risk pipes must be abandoned or removed by early May, within six months of the agreement.
In addition to pipes installed in areas prone to high temperatures, including metro Phoenix, Bullhead City and Yuma, there are other factors associated with outages. Consider situations where there is little or no gas flow in the pipes, and pipes with relatively small diameters.
The commission also approved an amendment proposed by Commissioner Kevin Thompson clarifying that the settlement does not authorize or authorize Southwest Gas to recoup the costs of pipe replacement, although the utility may seek reimbursement in future rate cases.
“I do not believe customers should bear full responsibility for manufacturer mistakes and their defective products, and I wish the utility had pursued this path more aggressively when they had the chance,” Thompson said in a statement.
In his letter, Derr indicated that the company plans to recover some of the costs in a future interest case, but not for the $2 million penalty. This could include about $3 million per year for the intensified leak patrols.
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