December 4, 2022
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PG&E bids to keep Diablo Canyon reactor open until 2030

By Jorge Mercado

Senior Staff Writer

Pacific Gas & Electric Company has taken steps this month that it hopes will lead regulators to allow PG&E to keep its controversial Diablo Canyon nuclear power plant online until 2030.

On Oct. 31, PG&E filed its first licensing action with the U.S. Nuclear Regulatory Commission, or NRC, to renew the operating licenses for Diablo Canyon’s Units 1 and 2. 

PG&E must obtain the necessary NRC licenses and get state regulatory approvals to operate the plant’s two units beyond their current operating licenses.

According to a news release, PG&E requested the NRC to designate the appropriate licensing process to follow, as the company withdrew its license renewal application in 2018 based on state energy policies at the time. 

California successfully lobbied in 2016 to close down the power plant by 2025.

But this year questions arose over whether the state has enough energy to meet electricity demands without the plant.

As a result, in an extended session on Sept. 1, the California Legislature overwhelmingly voted in favor of Senate Bill 846, which gave the state the option of keeping the plant open through 2030.

The bill was co-authored by State Sen. Bill Dodd, D-Napa, and Assemblymember Jordan Cunningham, R-San Luis Obispo.

Cunningham, whose district includes Diablo Canyon, has long supported keeping the plant open past 2025. 

In an Aug. 12 public meeting, hosted by the California Energy Commission, he noted that the state in 2016 had projected a reduced need for the energy produced by Diablo Canyon. 

But more recent projections by California Governor Gavin Newsom’s office and the Energy Commission indicated that if the plant is decommissioned in 2025, by 2026, the state could be in a 2.5-gigawatt shortage on a random September night.

Diablo Canyon can generate 2,200 megawatts of baseline electricity. It currently provides approximately 17% of California’s zero-carbon electricity supply and 8.6% of the state’s total electricity supply, according to a PG&E press release.

“We are proud of the role Diablo Canyon plays in providing safe, reliable, low-cost and carbon-free energy to our customers and Californians,” Paula Gerfen, PG&E’s senior vice president and chief nuclear officer said in the release. “This request to renew our licenses is another step to help California reliably achieve its bold decarbonization goals. We will help deliver on those goals while continuing to run one of the top performing plants in the country.” 

In addition to the need for renewed licenses from the NRC, the path for continued operations of Diablo Canyon past 2025 includes regulatory approvals from such entities as the U.S. Department of Energy, the California State Lands Commission, the California Energy Commission, the California Coastal Commission, and the California Public Utilities Commission. Senate Bill 846 also includes $160 million in new funding that will be credited to San Luis Obispo County, according to REACH — the Regional Economic Action Coalition, a San Luis Obispo-based economic development nonprofit.

That money could also help retain jobs at Diablo Canyon, which is one of the largest employers in San Luis Obispo County, at $225 million in annual payroll.

It also extends employee retention benefits through the life of the plant and protects the $85 million paid out in local mitigation funding under the original closure settlement.

The money will also go toward sustaining SLO’s economy once the power plant is closed.

One of the unintended consequences of eventually closing the Diablo Canyon Nuclear Plant near San Luis Obispo is that it has stirred up a long dormant dispute over 2,400 of the 12,000 acres that comprise a buffer zone around the facility.

As long as the plant was operating or headed for a license extension the question was largely moot as development in the buffer was off the table. But the decision to grant just a five-year extension to the plant, until around 2030, has opened the door for the owners of the Dry Cherry Creek Canyon, including Carlsbad-based HomeFed to challenge the terms of its lease to plant operator PG&E.

A San Luis Obispo court will determine whether the lease could be renewed for another century or more or whether it should be considered an agricultural lease subject to renewal. HomeFed would like to build hundreds of homes on the site. PG&E is fighting to keep the buffer area as undeveloped land for public use in accordance with a long-standing agreement that dates back to the early days of planning for the nuclear facility.