Edison Wants Nuke in Rates Until It’s Mothballed

By Published On: August 8, 2013

Southern California Edison is telling the California Public Utilities Commission it should be able to keep money collected from ratepayers through at least fall for its closed-down nuclear plant, rather than have to return it them. In a counterpoint, the Division of Ratepayer Advocates wants the commission to immediately remove $618 million from the ratebase since the plant is no longer used or useful to the grid (Current, June 28, 2013). Ratepayer advocates and Edison discussed retroactively removing reactor assets and potentially reducing the utility’s rate of return on the plant during two days of evidentiary hearings at the commission on Aug. 5 and 6. San Onofre hasn’t been used since January 2012 after the utility discovered premature wear in new steam generators it had installed in the plant. The commission is in the middle of a multiphase proceeding that began late last year on the question of whether to remove the now permanently closed down plant from Edison’s ratebase. In the current phase of the proceeding, the commission is seeking to identify the actual value of assets at the plant—including staffing levels and various pieces of equipment at the plant. In a late July filing, Edison told the commission its current net investment in the plant—after depreciation—amounts to $1.24 billion. Based on an analysis of what systems and personnel will be needed on an ongoing basis to keep the facility safely mothballed, the utility stated it would have to make use of assets valued at $281 million. Forty percent of the plant’s systems still will be needed to monitor, cool, and keep safe the radioactive waste stored at the site along the coast of northern San Diego County. Edison explained it plans to cut the plant’s workforce from 1,470 to 575 personnel in September. Of the remaining workers, 300 are security guards, according to the utility. A large number of guards are needed, according to Edison, due to the plant’s close proximity to public roads and a public beach. Fuel removal was completed July 18. It is stored onsite. Edison further noted the cost has gone up for securing replacement power and capacity since the plant closed down in 2012 due to prematurely worn steam generators. On an interim basis, Edison wants to use funds collected for operation and maintenance of the plant to cover those increased costs. Longer term, the utility noted it would seek to cut collection of operation and maintenance money for the plant in its 2015 general rate case by $280 million/year. Hearings in phase 2 of the proceeding are to continue in October. No decision that would affect rates paid for the plant is expected until February 2014.

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