PG&E Gas Operations

Gas Safety Excellence

API 1173

2PG&E Confidential

Gas Safety Excellence Framework

3

Our Strategic Drivers

• Provide a systematic framework to build world-class asset management capabilities.

• Proof of our progress as these international certifications can only be achieved through a rigorous, independent third party audit.

• Demonstration of growing strength of our safety culture, our rigorous approach to asset management and our commitment to gas safety excellence.

• Assurance to PG&E’s customers, regulators, and employees that the asset management policies and practices are effective in managing risk.

Why did PG&E Gas Operations launch and sustain Gas Safety Excellence?

4PG&E Confidential

API RP 1173

• Released in July 2015; is the American National Standard for pipeline safety management systems

• Developed to provide a framework for organizations that operate hazardous liquids and gas pipelines in response to major industry incidents

• API RP 1173 provides pipeline operators with safety management system requirements that when applied provide a framework to reveal and manage risk, promote a learning environment, and continuously improve pipeline safety and integrity.

• PG&E was on the American Petroleum Institute (API) advisory committee and helped co-author the standard.

5

Structure of Current Safety Management Systems

PAS 55 StructureAPI 1173 Structure

ISO 55001 Structure

6

Our Gas Safety Excellence Journey

February 2012

October 2012

February 2013

June2013

December2013

February 2014

April - May2014

November2014

February2015

August2015

November2015

Start of

our Program

Lloyds Pre-

AssessmentLloyds Visits

LloydsStage 1

Assessment

Lloyds Stage 2Assessment

Lloyds Surveillance

Visit

Lloyds Surveillance

Visit

Lloyds Surveillance

Visit

Lloyds Assessment

2012 20142013

Baseline Assessment

Progress Updates Full Review of the Asset

Management System

Field-Based Operational

Assessment & Verification

Progress Assessment and Review of Improvements

2015

API 1173PAS 55 and ISO 55001

Full Review and Field

Assessment

7PG&E Confidential

API RP 1173 AssessmentAPI RP 1173 Initial Assessment

Date: November 2015*Interviews Conducted: 30 Miles travelled: ~500Sites visited: 5

Areas of Strength:• Gas Control Center (use of data, tools and

technologies)• Stakeholder engagement – internal and

external• Safety Culture - Use of Corrective Action

Program• Emergency preparedness

Areas of Development:• Formalized collaboration between Integrity

management and Corrosion• Further enhancing the Asset Management

Plans• Competence assessments and QA/QC

incorporated into risk management process

*Annual surveillance assessment will take place in Q4 2016

8

Gas Safety Excellence Progress

Plan

Do

Check

Act

October 2012

4.2 Asset Management Policy

4.3.1 Asset Management Strategy

4.3.2 Asset Management Objectives

4.33 Asset Management Plans

4.4.1. Structure, Authority and Responsibility

4.4.2. Outsourcing

4.4.3 Training, Awareness and Competence

4.4.5 Asset Management System Documentation

4.4.6 Information Management

4.4.7 Risk Management

4.4.8. Legal and Other Requirements

4.4.9. Management of Change

4.5.1 Life Cycle Activities

4.7. Management Review

4.6.1 Performance and Condition Monitoring

4.6.2 Investigation of Asset-Related Failures

4.6.3 Evaluation of Compliance

4.6.4 Audit

4.6.5.1 Corrective and Preventative Action

4.3.4 Contingency Planning

4.5.2 Tools, Facilities and Equipment

4.6.6. Records

4.6.5.2 Continual Improvement

4.4.4 Communication, Participation and Consultation

4.2 Asset Management Policy

4.3.1 Asset Management Strategy

4.3.2 Asset Management Objectives

4.33 Asset Management Plans

4.4.1. Structure, Authority and Responsibility

4.4.2. Outsourcing

4.4.3 Training, Awareness and Competence

4.4.5 Asset Management System Documentation

4.4.6 Information Management

4.4.7 Risk Management

4.4.8. Legal and Other Requirements

4.4.9. Management of Change

4.5.1 Life Cycle Activities

4.7. Management Review

4.6.1 Performance and Condition Monitoring

4.6.2 Investigation of Asset-Related Failures

4.6.3 Evaluation of Compliance

4.6.4 Audit

4.6.5.1 Corrective and Preventative Action

4.3.4 Contingency Planning

4.5.2 Tools, Facilities and Equipment

4.6.6. Records

4.6.5.2 Continual Improvement

4.4.4 Communication, Participation and Consultation

Jan 2016

Major non-conformance

Minor non-conformance

Scope for Improvement

9

What Happens Next?

• Build a plan to address the areas of minor non conformance’s and scopes for improvement

• Maintain and improve the other components of our GSE structure

• Continue to improve the culture within our organization

• Share our journey with other lines of business within PG&E

• Benchmarking with other companies for ways to improve our organization

• Share our story with other utilities and leverage our achievement in providing assurance to stakeholders

INTT

ER

NA

LLY

EX

TER

NA

LLY

10

Joining An Impressive Group