Opinionated: The Long & Winding Road to End Nuclear Power in California

19 Mar 2018

By The Alliance for Nuclear Responsibility

The end of commercial nuclear power in California approaches, a little more than half a century after it began.

Of all the promises and boasts made by the early proponents of nuclear energy, their claim of “too cheap to meter” would eventually prove to be its undoing—at least here in California. The journey towards that conclusion stretched over a decade, and was the work of dozens of organizations and countless individuals. Among them was our non-profit, The Alliance for Nuclear Responsibility (A4NR). We employed a unique jurisdictional tactic that aided in the ultimate demise: Follow the money—most of it from ratepayer’s pockets!

A4NR was founded in 2005, with a mission to prevent the relicensing of California’s remaining nuclear power plants. Our initial strategy was to exploit this inherent economic liability in order to forge a nuclear-free California.

The previous decades, traditional opposition to nuclear power was directed at the U.S. Nuclear Regulatory Commission, where it was often defeated by the federal pre-emption clause.  With the ascendancy of the Bush administration and Congressional support for more nuclear power, federal pre-emption stopped all challenges to the NRC’s rubber-stamping of license renewals.

We at A4NR moved its opposition to a new venue.

Using a Supreme Court Decision from 1983, which gives the states the right to determine the need, reliability and costs of electricity, we switched away from de facto safety arguments, and took up the mantle of ratepayer watchdog.

The new playing fields became the California Public Utilities Commission and the state Legislature. The strategy was to use these two in concert to build the case against relying on nuclear power. For example, the seismic history of Diablo Canyon was fraught with contention from the start.

PG&E failed to identify all the potential earthquake faults, yet was given the green light by the NRC. When a significant fault was found—after construction was nearly complete—the process ground to a halt while hasty retrofits drove the costs from $1 billion to $5.7 billion. The rebuild barely passed muster, and the NRC approved it by fudging the factors in the margin for seismic errors. More egregious, a complacent CPUC passed billions in cost overruns on to ratepayers.

A4NR was intent on not letting this history repeat itself.

Understanding that seismic weaknesses alone were not enough to prevent NRC relicensing, A4NR sponsored AB 1632 (Blakeslee, R-San Luis Obispo), legislation that sought to: “… determine the potential vulnerability, to a major disruption due to aging or a major seismic event, of large baseload generation facilities of 1,700 megawatts or greater, including a specified analysis of the impact of a major disruption on system reliability, public safety, and the economy.” California’s two nuclear plants were over 1700 MW. Key were the issues of reliability and economy—with “safety” being as another of the economic factors. The bill passed unanimously.

The studies required by AB 1632 created hoops that PG&E was going to have to jump through if they wanted a license renewal at Diablo.

Arrogantly ignoring the state’s request for these answers, PG&E applied for NRC license renewal in 2009.

A4NR did not file opposition to the NRC license renewal; a rubber stamp of approval was assumed. Instead, we opposed PG&E’s attempt to get the CPUC to authorize $85 million from California ratepayers to fund the endeavor. Our argument was simple: PG&E was asking a state agency to approve state residents paying for work that had not yet answered the questions of state legislators (who sit in oversight of the CPUC). Regardless of what the federal agency may do, PG&E would have to answer to the state overseers if they wanted ratepayer funding.

The CPUC agreed that A4NR’s issues warranted hearings, and these were scheduled for April 2011. Then, the Fukushima disaster struck. Instead of hearings, PG&E put their NRC license renewal on “hold,” and at the end of the year the CPUC dismissed the funding case.

With the immediate threat of license renewal on hiatus, A4NR returned to state level activities.

Our initial legislative successes were sponsored by Republican officials, and passed with the unanimous support of their Democratic colleagues—a rare consensus on the topic of nuclear power.

A4NR subsequently sponsored AB 361 (Achadjian, R-San Luis Obispo), another unanimous and bipartisan bill closing a loophole that would have let the CPUC-approved ratepayer funding for our county’s emergency responders lapse before the Diablo Canyon’s licenses expired. Regardless of anyone’s stance on the use of nuclear power, all sides agreed that having a well funded, equipped and trained team to respond to an unlikely event was a good idea.

These legislative efforts—none of them aimed at “shutting the plant tomorrow”—allowed us to build our credentials and allies. This does not mean A4NR wouldn’t have been pleased with an immediate closing of the plant, but that we accepted the political realities needed to reach our longer-range goal of prohibiting a 20-year license renewal.

Our efforts also meant taking the “alliance” part of our name seriously. That required not only garnering support from logical allies in the environmental and antinuclear movement, but crafting arguments—and overcoming the fears—needed to influence the Rotary Club, the Kiwanis and the Chamber of Commerce. Having established our credentials largely through successful bipartisan legislative forays, we were granted these audiences. Raising the prospect that Diablo was a “golden goose” whose egg-laying mechanism (and local largess) could suddenly be “broken” caught the attention of fiscal conservatives.

It wasn’t necessarily the specter of Fukushima that swayed these new audiences, for PG&E and the NRC were quick to dismiss the likelihood of similar disaster at Diablo as impossible. It was the foreboding economic prospects of relicensing.

Helping us gather documentation of the negative economics of relicensing the plant was A4NR attorney John Geesman, a former bond trader and California Energy Commission member. He schooled us in reading PG&E’s public 10-Q filings with the SEC and monitoring their quarterly investor phone calls.

Over the ensuing years one could hear PG&E’s non-committal stance when questioned about relicensing.

Similarly, A4NR’s frequent visits to monitor California agencies like the State Water Resources Control Board and the Coastal Commission revealed that overcoming the state’s phase-out of Once Through Cooling water by 2025 was going to present costly obstacles to relicensing, like building cooling towers. In addition, our inquiries revealed that PG&E was making no progress in obtaining their Coastal Zone Management Act permits, which were a state requirement that had to precede NRC’s ability to grant a license renewal…one small chink in the seemingly invincible armor of federal NRC pre-emption!

Together, this evidence presented a picture of a utility pretending to keep the option of relicensing open while doing little substantive work to make it a reality.

Adding urgency to the situation was the sudden and premature closure of the San Onofre nuclear plant in 2013, which left 1,600 workers and local communities in a state of shock. Hoping to avoid the same fate for San Luis Obispo, A4NR attempted to start a dialog among local elected officials and business leaders regarding a post-Diablo scenario.

This proved awkward while Diablo was still operating and PG&E was providing income and spreading their charitable largess throughout the county. Local leaders expressed skepticism toward our entreaties, as they still anticipated reaping the billions of dollars PG&E predicted license renewal would bring to the community and state.

Contrarily, we saw a utility beset by federal indictments stemming from their gas explosion in San Bruno, mounting maintenance costs at Diablo, insurmountable regulatory hurdles, and falling prices for natural gas and renewable energy.

Fortunately, Senator Bill Monning (D-Carmel) was able to read the writing on the wall, and authored SB 968 (sponsored by A4NR), which called for the completion of a study as to how the County could mitigate the financial losses that would come with Diablo’s retirement. This 2016 bill was also unanimously approved by both parties, and in a more subtle way was the beginning of an acknowledgment that Diablo’s last days could be coming sooner than a license renewal.

Meanwhile, back at the CPUC, A4NR intervened in PG&E’s 2017 General Rate Case.  With former utility and CPUC lawyer Al Pak guiding our efforts, his forensic skills detected that PG&E’s schedule for amortizing necessary capital improvements at the plant didn’t match with the timeline for a license renewal.

“Why” he speculated, “would PG&E be amortizing expensive capital improvements over only eight years when these upgrades would last the entire life of a 20 year license renewal?”  We let PG&E know that A4NR was going to challenge these costs.  No more prevaricating: Their witnesses would be asked under oath, “Is PG&E going to pursue license renewal or not?”

Not long after firing that salvo, we found ourselves atop PG&E headquarters negotiating the Joint Proposal to abandon license renewal and retire the plant no later than 2025.

Renewable prices had fallen dramatically, more customers were abandoning the utility for “Community Choice” energy providers, maintenance and potential retrofit costs were climbing…in short, nuclear power had become economically uncompetitive for PG&E. These factors brought the utility, the unions, environmentalists, consumer organizations and the local community to the table in an unprecedented effort to create a template for nuclear utilities facing closure around the nation.

The Joint Proposal to retire Diablo placed before the CPUC for approval four sub-issues: Replacing Diablo’s output with energy efficiency and renewable power; providing retention bonuses and retraining money for labor; providing financial mitigation for the local community; and PG&E’s request to recoup $53 million that they had spent on their aborted NRC license renewal.

A4NR took no position on the first issue, lacking expertise in the nuances of renewable energy policy. We supported a well-paid work force to maintain safety at the plant while it continues to operate. We supported having the local community “made whole,” given the devastating consequences experienced during other nationwide nuclear plant closures. In addition, A4NR set a precedent in negotiating a clause in the Joint Proposal that has PG&E pledging to maintain community emergency response capabilities through the entire decommissioning process in case of any mishap—something not adopted at other sites. And, significantly, A4NR alone continued to oppose any recovery of license renewal funding—an endeavor we’d considered wasteful since we first opposed it in 2010.

Ultimately, A4NR settled with PG&E over that issue, allowing the utility to keep less than one-third the amount requested, and requiring other concessions that worked to mitigate even the small amount they were allowed.

Regrettably, the CPUC did not approve all the other provisions of the Joint Proposal.  The commission rolled back 10 percent of the employee retention funding, eliminated the community impact funding, and was less than specific on the need for replacement energy to be greenhouse-gas free.  For the latter, it seems as if the lesson of the SONGS closing—which led to a spike in GHG emissions for that region—was lost on the agency.

To its credit, the CPUC did advise the parties to take their concerns to the Legislature for remedy, and so we have. This dynamic group will continue to support SB 1090 (Monning-Cunningham) in Sacramento, which would require the CPUC to implement the benefits from this unique proposal to protect the workers, the community and our energy future while safely phasing out the last aging nuclear power plant in the state. We stand by the hope that this pioneering effort to bring together former adversaries—environmentalists, unions, utilities and ratepayer advocates—will set a template for over 70 other nuclear host sites that will be facing shutdown in the coming decades.

A4NR has achieved its goal of preventing relicensing of nuclear power plants in California.

The good news is we are discussing decommissioning, and not another 20 years of nuclear power.

Many players and many events—from natural disasters to mechanical failures—contributed to this achievement. For our part, we’d like to posit that the decision to use economic arguments combined with state-level legislative and regulatory action allowed us to carve a particular niche, and forge the alliances necessary that resulted in PG&E’s decision to phase out California’s last nuclear power plant.

Rochelle Becker is the executive director and David Weisman the outreach coordinator of the Alliance for Nuclear Responsibility (www.a4nr.org)

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