Investing $700 million to allow on-site storage of Pacific Gas & Electric?s Diablo Canyon nuclear plant?s aging radioactive steam generators, which are slated for replacement, is promoted by an environmental impact report conducted by the utility. The EIR justifies the utility?s plan by noting that alternatives to installing new steam heat exchangers at the plant?including renewables?have their own environmental impacts. In addition, PG&E sidesteps the possibility of requesting 20-year license extensions from the Nuclear Regulatory Commission. The report, filed late last week, is part of the second phase to finalize PG&E?s investment. Last month, the utility?s investment was largely approved by the California Public Utilities Commission, but it still must meet California Environmental Quality Act requirements (<i>Circuit</i>, Feb. 24, 2005). CEQA requires analysis of projects that could have environmental effects. The report noted ?that implementation of the proposed project could provide an incentive for PG&E to apply to extend the licenses and thus may increase, to some degree, the likelihood that PG&E will apply for license extension.? It added, however, that a license renewal was ?remote and speculative and need not be considered in this document.? Not considering a license extension in the EIR avoids having to address increased long-term radioactive waste storage. Without a license extension, the $706 million investment would allow the new equipment to operate for a balance of about 8 to 12 years before the units? current licenses expire in 2021 and 2025. The steam generators now in place are expected to last until about 2013-14. That means that instead of the traditional 30-year investment for power plants, this investment would have closer to a 10-year duration?more in line with the time frame the utilities want for new power contacts under the commission?s new procurement guidelines. The shorter the amortization period, however, the more expensive the investment is to ratepayers. The report discusses the option of carting the current steam generators to a disposal site away from the plant. Such disposal is ?technically feasible, and may lessen existing onsite environmental effects.? But the generators would have to be shipped to a site that accepts radioactive waste. Similar attempts to send the San Onofre Nuclear Generating Station unit 1 reactor vessel to a permanent burial site were unsuccessful (<i>Circuit</i>, Jan. 23, 2004). While the report mentions bluff instabilities in some potential sites for on-site storage and a potential effect on Diablo Creek, the risks of storing radioactive parts near a seismically active area are not discussed. The CPUC would not allow seismic hazards to be vetted in administrative court, leaving the debate, if any, to federal regulators. The environmental impact report, as required, also discusses the impact of not building the project in question. This ?no project? alternative is favored by environmentalists, consumer groups, and competitive generators. The report notes that if the project is not carried out, the steam generators will ?continue to degrade from stress and corrosion cracking? and cause early shutdown. ?Power generated by Diablo would need to be replaced and the state?s transmission system would need to be modified.? There would have to be four or five gas-fired plants in Northern California and the southern Central Valley to replace Diablo along with new transmission lines and gas pipelines, according to the EIR. Replacing Diablo?s power with renewables is far from problem-free. Installing photovoltaics, for instance, would require about 400 acres for each 100 MW of sun-fired output. Conservation and demand-side management would be insufficient, according to the report. Comments are due by May 5. A copy of the report can be found at <i>www.cpuc.ga.gov/environment/info/aspen,diablocanyon/toc-deir.htm</i>. <b>Bechtel Audit Shows Steam Gen Overbilling</b> Bechtel, which built Pacific Gas & Electric?s Diablo Canyon nuclear plant, was found to have padded its cost to install steam generators at a Tennessee Valley Authority nuclear plant. According to the Associated Press, an internal audit revealed that Bechtel billed TVA $3 million in questionable charges. The discovery was a result of the news service?s Freedom of Information Act request. PG&E has not yet revealed what contractor will be hired to replace Diablo?s aging steam generators, according to PG&E spokesperson Jon Tremayne. Bechtel, however, notes that it has handled 27 of the 34 steam generator replacements in the country in the last 20 years. ?The TVA Inspector General questioned $3 million, or about 3 percent, of our billings. Our detailed analysis, provided in a reply to the TVA, found only $200,000, or 0.2 percent of billings, to have been unreimburseable,? Bechtel said in a written response.