PA Environment Digest Blog: PUC: Deadly West Reading Chocolate Factory Explosion Prompts PUC Safety Complaint Against UGI Proposing $2,576,627 In Penalties

On March 18, the Public Utility Commission’s independent Bureau of Investigation and Enforcement filed a formal complaint against UGI Utilities, Inc. – Gas Division (UGI) following a detailed investigation into the March 2023 natural gas explosion at the R.M. Palmer Company chocolate factory in West Reading, Berks County that killed seven workers and injured ten others.

The complaint alleges multiple violations of the Public Utility Code, Commission regulations, and federal pipeline safety standards related to the design, operation, and oversight of UGI’s gas distribution facilities serving the factory.

I&E is seeking $2,576,627 in civil penalties — the maximum amount permitted by law — along with a series of corrective actions aimed at strengthening pipeline safety oversight, addressing risks associated with aging plastic pipeline materials, and expanding advanced methane leak detection technologies.

Among the key corrective actions proposed in the complaint, I&E calls for UGI to:

-- Expand the deployment of smart remote methane detection systems, capable of identifying natural gas leaks and alerting operators or emergency officials through modern communications networks.

-- Establish new procedures for retiring aging Aldyl-A plastic service tees with Delrin inserts, which have been linked to failures in vintage plastic pipeline systems.

-- Increase leak survey frequency for older plastic pipelines, particularly in dense urban areas where underground leaks may quickly become hazardous.

-- Improve tracking, mapping, and risk analysis of vintage plastic pipeline assets installed prior to 1983.

-- Strengthen emergency response coordination procedures and integrity management programs designed to identify and mitigate risks affecting pipeline infrastructure.

Explosion Caused Fatalities, Injuries and Extensive Damage

The explosion and resulting fire destroyed one Palmer factory building, severely damaged another, and destroyed a nearby apartment building, displacing several families.

In addition to the seven workers killed in the blast, four individuals suffered serious injuries and six others were injured.

The explosion caused approximately $42 million in property damage and prompted a large-scale emergency response involving 56 responding agencies, including fire and rescue units, law enforcement, emergency medical services, and search and rescue teams.

Investigation of the Incident

The explosion occurred at approximately 4:55 p.m. on March 24, 2023, at the Palmer chocolate manufacturing facility located at 17 South 2nd Avenue in the Borough of West Reading.

PUC safety engineers immediately responded to the scene, launching an extensive investigation and detailed technical analysis of the utility’s gas distribution system serving the facility.

The investigation determined that natural gas leaked from a retired plastic service tee connected to a vintage Aldyl-A plastic pipeline located beneath Cherry Street near the Palmer facility.

Gas migrated underground and entered the factory building, where it was ignited by an unknown source.

Investigators also identified significantly elevated ground temperatures in the area caused by steam escaping from a corroded underground steam pipe belonging to the Palmer facility that was located near UGI’s pipeline infrastructure.

The National Transportation Safety Board conducted a parallel investigation and concluded that the probable cause of the explosion was degradation of the retired Aldyl-A polyethylene service tee, which allowed natural gas to leak and migrate underground into the factory building where it ignited.

According to the NTSB, contributing factors included elevated ground temperatures from the leaking steam pipe and UGI’s failure to identify and manage risks associated with nearby infrastructure and environmental conditions affecting its pipeline facilities.

Alleged Pipeline Safety Violations

The I&E complaint alleges 27 violations of state and federal safety regulations governing natural gas distribution systems. Among the key allegations, I&E asserts that UGI:

-- Failed to maintain accurate facility records and mapping for pipeline infrastructure serving the Cherry Street segment.

-- Did not adequately identify and manage risks associated with vintage plastic pipeline components, including Aldyl-A infrastructure installed in 1982.

-- Failed to account for elevated ground temperatures from nearby heat sources, including steam lines, when designing or maintaining plastic pipeline facilities.

-- Did not implement sufficient integrity management and surveillance procedures to identify and mitigate potential hazards affecting the system.

-- Failed to maintain adequate emergency response procedures and coordination, including communication protocols during the initial response to the explosion.

-- Failed to take all reasonable measures necessary to protect the public and maintain safe facilities, as required under the Public Utility Code.

Next Steps in the Enforcement Process

The I&E complaint will be reviewed through the PUC’s formal adjudicatory process before the Commission’s Office of Administrative Law Judge.

UGI will have an opportunity to respond to the allegations before the Commission determines whether violations occurred and what penalties or corrective actions may ultimately be imposed.

Documents related to this case are available at PUC Docket No.: C-2026-3061133.

Click Here for the PUC announcement.

PA Oil & Gas Industry Public Notice Dashboards:

-- PA Oil & Gas Weekly Compliance Dashboard - March 14 to 20 - Conventional Well Owners Failed To Comply With Orders To Plug Wells, Restore Drilling Sites; Stop Gas From Bubbling Out Of The Ground [PaEN]

-- PA Oil & Gas Industrial Facilities: Permit Notices, Opportunities To Comment - March 21 [PaEN]

-- DEP Invites Comments On Chapter 105 Permit For 5-Mile Long Expand Operating LLC Water Pipeline To Support Shale Gas Development In Auburn Twp., Susquehanna County [PaEN]

-- DEP Issued Chapter 105 Permit For Homer City Generation LP A.I. Data Center Campus Natural Gas Power Plant Site In Indiana County [PaEN]
-- Susquehanna River Basin Commission Approved 22 Shale Gas Well Pad Water Use General Permits In February; 54 In 2026 [PaEN]

-- DEP Posted 64 Pages Of Permit-Related Notices In March 21 PA Bulletin [PaEN]

-- DEP Invites Comments On A Chapter 105 Permit For The Limerick 67 MW PECO Energy Transmission Line Crossing The Schuylkill River In Chester, Montgomery Counties [PaEN]