CPUC Advances $4B Settlement to Close Diablo Canyon Nuclear Plant

By Published On: August 12, 2021


A $3.9 billion settlement between Pacific Gas & Electric, ratepayer advocates, nuclear watchdogs, and others to decommission the utility’s Diablo Canyon Nuclear Power Plant gets a green light under a California Public Utilities Commission proposed decision.


It is nearly $1 billion below what PG&E sought to decommission its two Diablo units set for closure in 2024 and 2025. The utility’s $4.8 billion proposal faced significant push back from the Alliance for Nuclear Responsibility (A4NR), CPUC’s Public Advocates Office and The Utility Reform Network. The 2,240 MW Diablo Canyon is the only remaining nuclear power plant in California. The utility made the request as part of its 2018 triennial decommissioning rate case.


“We are pleased to have achieved these savings for ratepayers as we bring the nuclear power era in California to a safe closure,”A4NR Executive Director Rochelle Becker said Aug. 12.


The $3.9 billion settlement reached 18 months earlier, in January 2020, covers the utility’s decommissioning costs from 2020 to 2027. The associated revenue requirement is roughly $112.5 million per year.


Public Advocates Office Spokesperson Maya Chupkov said the office was pleased with the proposed adoption of the settlement because “it provides adequate funding for decommissioning, while protecting ratepayers.”


PG&E also welcomed the tentative approval of the “compelling, well-researched and comprehensive settlement plan,” added James Noonan, utility spokesperson.


The multi-party agreement, if approved by the full Commission, includes $300 million for PG&E to hire a company to help it deal with spent radioactive fuel rods kept cool in pools on the site south of Morro Bay. The California Energy Commission will evaluate proposals and bids for the accelerated transfer of the spent nuclear fuel.


The highly radioactive waste sitting in pools will have to be transferred into dry casks for safety and eventual transport. The agreement requires the job to be carried out in three years, not seven as sought by PG&E. It also continues oversight by the Diablo Canyon Independent Safety Committee during decommissioning, and until the spent fuel is sealed into casks.


Spent radioactive rods, which generated the needed heat in the reactor, are kept in pools where water is continually circulated to keep them from overheating. The pools require ongoing maintenance. Transferring them to dry, solid casks is a critical step to avoiding a high risk accident at the pools, including a pump malfunction that could stop the circulation of the water. That could result in the exposure of intensely hot rods to the air, possibly causing a “nightmare” fire, David Weisman, A4NR spokesperson, said.


The settlement also saves ratepayers $400 million by maintaining, instead of removing, the current breakwater near the shore of the Central Coast nuclear plant. Another $400 million is for the final decommissioning of PG&E’s long shuttered Humboldt nuclear power plant.


Other parties to the settlement include San Luis Obispo County, Women Energy Matters, and Northern Chumash Cultural Preservation Kinship.


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