In September 2020, Patricia Ruiz Roe was killed when her home in Gypsum exploded due to a gas leak. Roe, a 49-year-old mother and wife, left behind two young children. 

The leak was caused by Black Hills Energy incorrectly marking a gas pipeline, resulting in the pipeline being ruptured during a drilling operation, according to the Colorado Gas Pipeline Safety Program. Black Hills Energy then failed to advise residents to evacuate, the program found. 

In response to Black Hills Energy’s deadly actions, the program issued the company a verbal warning. 

Though the Gas Pipeline Safety Program is supposed to inspect operators and enforce compliance of safety requirements, this kind of non-action towards safety violations is commonplace, according to an audit released Monday. 

From 2017 to 2022, 94% of the 5,643 safety noncompliances identified by the program received no enforcement actions, the audit found. This included accidents that caused at least two deaths, over a dozen injuries and millions of dollars in property damage. When verbal warnings were given, the program did not always follow up to ensure the safety issues were fixed. 

Nearly 2,500 safety noncompliances during the five-year period were repeat instances from only 14 operators, but the program didn’t issue the operators any compliance actions. The top offenders were Xcel Energy (1,078 instances), Colorado Natural Gas (566) and Black Hills Energy (197). 

“When operators are noncompliant and the program doesn’t enforce safety requirements, the noncompliance can continue,” said Legislative Audit Manager Jenny Page during a presentation Monday. “When enforcement is lacking, there’s also a risk of these safety accidents.” 

Penalties for safety violations are even more rare than written enforcement actions. 

The program assessed only 23 penalties for the 5,643 safety noncompliances from 2017 to 2022. The 23 penalties should have totaled over $10.9 million based on the assessments, but the program collected only four, totaling $208,530, the audit found. 

The program also did not bring penalties against the most prolific offenders. Of the top five operators with the most repeat noncompliances, the program only penalized one in the last three years: Xcel Energy for $100,000. This violates federal and state laws that establish minimum penalty amounts and require the severity and history of an operator’s noncompliance to be taken into consideration when determining penalties. 

If the program followed federal and state laws regarding penalties, it would have collected between $2.4 million and $689 million from 2020 to 2022, depending on the duration of continued noncompliance. Instead, the program collected only $5,000 in penalties during these years, the audit found.

“The program’s failure to penalize the worst offenders demonstrates it isn’t enforcing safety requirements effectively,” said Audit Supervisor Cariann Ryan. “They assess penalties to small, private operators for paperwork issues, while assessing only a written warning to Xcel in 2017 for not monitoring pipelines for leaks and not taking prompt action to correct deficiencies.” 

In addition, the audit found that the program did not inspect operators or have records of inspections within the required one- to five-year timeframes, did not meet federal inspection metrics, and had missing or incomplete inspection records. 

From 2017 to 2022, the program failed to complete on time 100% of emergency plan procedure inspections, 88% of implementation of transmission integrity management program inspections, 88% of field observation of emergency response inspections, 86% of implementation of distribution integrity management program inspections and 77% of field inspections. 

Of the program’s 15 inspectors, 13 lacked required training and supervision, the audit found. Three inspectors also had conflicts of interest, inspecting companies they recently worked for immediately after being hired to the Gas Pipeline Safety Program. 

Other findings from the audit include that the program has not tracked complaints received about gas pipeline safety and operators, it misreported Colorado’s number of gas pipeline accidents to the federal government, and it lacked evidence that it investigated gas pipeline accidents as required.

The audit made 39 recommendations for the Gas Pipeline Safety Program to address the findings. The Colorado Public Utilities Commission, which administers the program, agreed to 38 of the recommendations and partially agreed to one. 

“We have a phenomenal team of inspectors, I have a lot of faith in them. They take their job really seriously,” said Rebecca White, director of the Public Utilities Commission. “I do believe we have improvements to make on the administration and our processes. … We’re committed to do that.” 

Some of the major recommendations ask the Public Utilities Commission to establish documentation practices for the program, track compliance actions and penalties, request more inspectors as needed, develop an objective process to assess and collect penalties, develop procedures for compliance follow ups, and incorporate a risk assessment into inspection scheduling.

Each of those recommendations must be implemented between January and June of 2024. 

The recommendation the Public Utilities Commission only partially agreed to asked them to develop processes to monitor and track gas pipeline safety accident information from the National Response Center, and to review potential gas pipeline accidents reported by the Colorado news media to identify accidents that have not been reported to the program. The commission agreed to track such incidents, but declined to investigate them, saying they are out of the commission’s jurisdiction.

The audit was requested by the state legislature, with the findings reported to the Legislative Audit Committee on Monday. During the committee meeting, lawmakers asked questions about the report but rarely commented on the findings. 

Sen. Rod Pelton, R-Cheyenne Wells, was the only lawmaker to raise concerns about the recommended changes the program, questioning whether it would increase penalties charged to gas companies. 

“At the end of the day, we need safety, but we also need these operators to stay in business,” Pelton said, adding that costs of penalties are “dollars coming out of these companies’ pockets, which, in turn, is coming out of our taxpayers’ pockets. They don’t just absorb that cost, it’s passed on.” 

However, lawmakers largely seemed to agree with the audit’s recommendations, emphasizing the need to follow state and federal laws, and keep Colorado’s gas pipelines safe. 

“We’re watching what you all are doing and I need to impress on you all how important it is that we maintain the highest standard of safety,” said Sen. Rhonda Fields, D-Aurora. “These are things that we can do. … The guidelines are there, it just has to be followed and it has to be implemented and there has to be some accountability.”