Final answer:
The assertion that PG&E used surplus revenues to improve safety before the 2010 explosion is false. Instead, investigations indicated a lack of safety prioritization. Ethical decision-making is crucial, particularly when environmental and public safety risks are involved.
Step-by-step explanation:
The statement that prior to the 2010 natural-gas pipeline explosion in San Bruno, California, Pacific Gas & Electric (PG&E) used its surplus revenues to improve safety is false. In fact, investigations following the disaster revealed a history of inadequate safety measures and that PG&E had prioritized profits over safety improvements. This tragedy emphasized the significance of ethical decision-making within the utilities industry, and the importance of balancing corporate profitability with the welfare of the public and environmental stewardship.
As discussed in several economics and environmental impact statements, companies are obligated to weigh the marginal benefits against the potential marginal costs and externalities when making decisions like pipeline construction. The potential risks, particularly to the environment and public safety, should be an integral part of the decision-making process. The San Bruno incident is an example of an outcome where ethical considerations were arguably overlooked in favor of financial interests.