July 2, 2024
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State budgets funds to keep Diablo Canyon open


California decided to retire the Diablo Canyon nuclear power plant six years ago, but state and federal officials and the plant’s operator have taken new steps toward potentially keeping it open past its scheduled 2025 closure date.

Located on San Luis Obispo County’s coast, Diablo Canyon powers two water reactor units licensed until 2024 and 2025, respectively. The plant produces 18,000 gigawatt-hours of electricity and serves more than 3 million California residents, making up almost 9% of California’s energy portfolio, according to the California Energy Commission. 

Pacific Gas & Electric, the plant’s owner and operator, announced plans to retire Diablo Canyon in 2016 because it projected a reduced need for energy the plant produced. Gov. Gavin Newsom was then the California lieutenant governor and sat on the State Lands Commission at the time, and voted in favor of the plant’s full closure by 2025.   

Recent concerns about the state’s planned transition to fully carbon-neutral energy sources by 2045, along with increasing brown-outs and blackouts throughout the state, have recently pushed Newsom to consider extending the power plant’s operations.

The state energy trailer bill, which passed the Legislature on June 26, has $54 billion in funding for new energy investments and up to $4.3 billion for energy reliability, which could be used to keep Diablo Canyon open. And in April, the Biden administration launched a $6 billion nuclear plant bailout program through U.S. Energy Department credits, another potential source of funds to preserve Diablo Canyon. 

The U.S. Energy Department’s Civil Nuclear Energy program distributes these credits to nuclear power plants through an application process, and PG&E recently asked for an extension so it could “consider and possibly apply for funding,” said Lynsey Paulo, PG&E’s director of marketing and communications. The Department of Energy agreed to that extension on June 30, and PG&E now has until Sept. 6 to apply for the funds.

The money is only one element of keeping Diablo Canyon open — any extension of the plant’s permits would require action by the California Legislature as well as approvals by federal, state and local regulators.

The state recently directed PG&E prepare for potential legislative actions that could keep the plant operational.

“We have been asked to provide information to the state regarding what state approvals or other actions would be required to potentially continue operations at the plant past 2024-2025 in order to support state grid reliability, should there be a change in state policy,” Paulo said. 

PG&E does not yet have estimates of what it would cost to keep Diablo Canyon running, she said. 

“Given that the Governor only recently asked us to explore the steps needed to preserve the option of continued operations and our ongoing evaluations of the DOE guidance, we don’t have any estimates to share at this time,” Paulo said. 

The California Energy Commission has not yet conducted an environmental impact analysis of the power plant remaining operational, according to spokesperson Lindsay Buckley. When the plant eventually retires, as California moves toward its goal of clean energy without nuclear sources by 2045, the state will make up the energy produced by the plant with wind, solar and energy storage, according to Buckley. 

The power plant is the biggest private employer in the 35th State Assembly District, said 35th District Assemblyman Jordan Cunningham, a San Luis Obispo Republican. Cunningham said the state’s goals for phasing out electric vehicles, decarbonizing its economy and producing more housing will all require more electricity, and Diablo Canyon can provide that power.

“It’s insanity to take out the largest single asset-producing electricity in the entire state unless it was broken or it wasn’t working anymore,” he said. “If you want to achieve … zero-carbon electricity generation eventually and keep the lights on, we got to keep every asset we got.” 

In the meantime, PG&E is preparing its application for federal funding to keep the plant operational during California’s long-term transition to full carbon neutrality. 

“I think it’s totally feasible that a five-year extension at Diablo could bridge us to where we are ready in terms of off-shore wind and storage capacity to fully replace it,” Cunningham said.