CPUC Approves $241M Diablo Nuclear Plant Closure

The California Public Utilities Commission Jan. 11 unanimously approved a decision significantly reducing the proposed amount Pacific Gas & Electric ratepayers are to pay to shut the 2,240 MW Diablo Canyon Nuclear plant along the Central Coast by 2025.

“This moves California away from the era of nuclear power toward zero carbon renewable energy,” said Commissioner Liane Randolph. She did warn that there may be a temporary increase in greenhouse gases with the shut down of Diablo’s two units. She added, however, that California will still meet its 2030 carbon emissions reduction goal of cutting gases 40 percent below 1990 levels because of a decline in the use of natural gas-fired plants.

Mike Picker, CPUC president, acknowledged the controversy arising from the approved decision by Administrative Law Judge Peter Allen. The decision rejects $1.3 billion in energy efficiency funding. It calls for any determination regarding replacement megawatts or negawatts for Diablo to be weighed in the commission’s Integrated Resource Planning process.

The approved $241.2 million closure plan is a fraction of the $1.76 billion requested by PG&E and a diverse group of stakeholders, from large energy users to energy efficiency advocates.

The decision, approved 5-0 on Thursday, not only excludes $1.3 billion for energy efficiency, but also cuts $85 million proposed to fill the loss of property taxes and other income to the Central Coast communities collected from the 30-year old nuclear plant near San Luis Obispo.

The commission insisted that PG&E shareholders could fund the $85 million in lost community funds. It noted that legislative approval was needed to require ratepayers to backfill discontinued property tax payments from PG&E.

The utility also sought $352.1 million for expenses associated with retaining and retraining the 1,500 employees whose days are now numbered working at the nuclear plant. In the final decision, state regulators provided $222.6 million for the employees. That represents a $50 million increase over retention and retraining costs initially proposed by Allen.

“While we are disappointed that they did not approve the full employee retention program, as well as the community impact mitigation and energy efficiency programs, we are appreciative that the CPUC took the positive step to increase the amount of funding for employee retention beyond their original proposed decision,” PG&E stated.

The decision also approves $18.6 million in rate recovery for expenses PG&E incurred from 2009 to 2011 when it attempted to relicense the plant.

Clean energy advocates were split on the proposal, with some lamenting the loss of energy efficiency funds and others applauding the ruling.

Picker pointed out that Diablo, which is not needed for local reliability and exacerbates over generation and renewable curtailment, may shut ahead of schedule because it’s uneconomic. An earlier than expected closure may occur because of the loss of PG&E customers to community choice providers and direct access, as well as increases in plant maintenance costs, he said.

Picker noted that PG&E representatives should be prepared to present scenarios during the Integrated Resource Plan proceeding for plant unit closures before 2024/2025. — Elizabeth McCarthy

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CPUC Approves $241M Diablo Nuclear Plant Closure

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