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California seeks to fine utility a record $2.25 billion for pipeline blast

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California regulators are seeking a record-setting $2.25 billion fine against a utility company blamed for a deadly pipeline explosion that took out a San Francisco Bay-area housing community.

The amount of the proposed penalty is the largest that's ever been recommended by investigators with the state Public Utilities Commission, CBS reported. Regulators said it's warranted, given the warnings the company, Pacific Gas & Electric, received over the years for safety violations.

Regulators also made clear they would prefer shareholders, not customers, bear the costs of the fine, CBS reported.

"This is going to send a very strong deterrent message to PG&E that this kind of conduct and culture will not be tolerated," said Brig. Gen. Jack Hagan, director of the PUC's Safety and Enforcement Division, on CBS. "They have just plain failed to follow safety standards in so many areas."

The pipeline exploded in 2010 in San Bruno. The ensuing fire killed eight, injured dozens and destroyed 38 homes. Investigators with the National Transportation Safety Board ruled in 2011 that the accident was caused by what was described as a "litany of failures" on the part of PG&E, and by weak regulatory oversight, CBS reported.

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