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Friday, December 8, 2023 | Back issues
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PG&E Must Face Lawsuit Over Century-Old Gas Plant Contamination

Pacific Gas and Electric must face claims that a gas plant operated by its predecessors more than 100 years ago continues to leak harmful toxins into the San Francisco Bay, a federal judge has ruled.

SAN FRANCISCO (CN) — Pacific Gas and Electric must face claims that a gas plant operated by its predecessors more than 100 years ago continues to leak harmful toxins into the San Francisco Bay, a federal judge has ruled.

U.S. District Judge William Orrick III refused to dismiss a lawsuit brought by former San Francisco resident Dan Clarke. The litigation seeks to force PG&E to investigate and clean up contamination left by the Cannery gas plant, owned and operated by PG&E’s predecessors from 1898 to 1907.

Clarke’s lawyer, Stuart Gross of Gross & Klein in San Francisco, touted the decision as an encouraging outcome for his client and the environment.

“This is a good result,” Gross said in a phone interview Monday. “We’re pleased that we’re allowed to move forward, and we look forward to compelling PG&E to pay for the cleanup of this area.”

In 2018, PG&E settled claims related to three other manufactured gas plants operated in San Francisco at the turn of the 20th century. PG&E agreed to investigate, monitor and report levels of polycyclic aromatic hydrocarbons, or PAHs, toxic byproducts of the gas manufacturing process. The utility also vowed to create a cleanup plan for groundwater contamination and pay $4.2 million for water quality and environmental improvement projects.

That settlement did not address a fourth gas plant known as the Cannery near San Francisco’s Ghiradelli Square and Aquatic Park. The former plant’s footprint, encompassing one city block, is now occupied by a hotel, restaurants, shops, and a National Park Visitor Center.

Like other manufactured gas plants at the turn of the century, the Cannery used oil and coal to create gas for lighting, heating and cooking. The plant, operated by PG&E predecessors the Equitable Gas Light Company and San Francisco Gas and Electric company, was demolished in 1907 after the Great Earthquake of 1906.

A 1985 test of soil samples in the area by the National Park Service found contamination six times higher than the level at which soil should be suspected as a source of groundwater contamination. A follow-up study by PG&E in 1986 found a “very high level” of PAHs, lead and other toxins, according to Clarke’s lawsuit.

In his Friday night ruling, Orrick advanced a claim that PG&E’s alleged conduct has diminished Clarke’s aesthetic and recreational enjoyment of a shoreline area in the city’s Marina District where he used to reside and still goes on walks.

However, the judge dismissed Clean Water Act claims on statute-of-limitations grounds, finding Clarke failed to show a distinct violation that occurred within the last five years. He also dismissed state law claims of negligence and strict liability, finding Clarke could not base those claims on his decision not to buy a house on San Francisco’s northern waterfront. Clarke moved to the suburb of San Mateo after selling his previous home near San Francisco’s northern shore to PG&E. Clarke says the sale resulted from a failure to get PG&E to agree on a plan for cleaning up contaminated soil on the property.

The judge gave Clarke 20 days to amend his lawsuit with more details that could potentially overcome the utility’s motion to dismiss.

Though he dismissed the Clean Water Act claim for timeliness, the judge refused to accept PG&E’s argument that it could never be held liable because the claimed transgressions took place before the law was passed in 1972.

“I find that Clarke has adequately alleged an ongoing discharge that does not seek retroactive application of the [Clean Water Act],” Orrick wrote in his 21-page decision.

Clarke’s lawyer said he believes that claim will move forward after an amended complaint is filed.

“We’re confident that the shortcomings that Judge Orrick identified in that claim can be resolved,” Gross said.

Like other manufactured gas plants in the late 1800s and early 1900s, the Cannery was a “bridge” between whale oil and natural gas. It produced highly toxic, 20th century-style contaminants associated with refined petroleum but with a waste disposal system designed for the 18th or 19th centuries, he said.

“What we’re ultimately seeking here is the establishment of an environmental remediation trust that PG&E would fund and be responsible for investigating and cleaning up the manufactured gas plant waste,” Gross said.

In a statement Monday, PG&E said it considers the safety of its customers and the public a top priority, which includes “a strong commitment to the environment and addressing any impacts from historical operations.”

However, the utility insisted that it is not responsible for any contamination from the turn-of-the-century gas plant because “PG&E did not operate the former Cannery Manufactured Gas Plant.”

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