Reject the Eleventh-Hour Diablo Canyon Revival Attempt

Two weeks before California’s legislature adjourns for the year, a legislative proposal is circulating to extend the lifetime of the Diablo Canyon nuclear power plant by more than a decade. Legislators should reject it out of hand. The bill includes sweeping exemptions from the California Environmental Quality Act, the California Coastal Act and California’s once-through cooling requirements. Federal Coastal Zone Management Act compliance requirements would be lifted. State permitting agencies would be forced to act on life extension applications within 180 days, and their decisions would have to “prioritize” legislative findings that the plant is “critical” to maintaining reliable electricity service. No citations accompany these draft findings, and indeed no state agency or regulator has authored a study recommending that Diablo Canyon operate past its planned retirement date of August 2025.

Diablo Canyon Nuclear Power Plant

There’s more. The State of California would loan PG&E up to $1.4 billion to cover costs of extending Diablo Canyon’s operating life, with all of the loan potentially “forgivable,” and as part of that payment PG&E would receive seven dollars for every megawatt-hour of power generated “prior to the start of extended operations.” Diablo Canyon’s annual generation averages about 18,000,000 megawatt hours, so that upfront annual subsidy would exceed $125 million. 

There’s still more. Every customer of a local community choice aggregator or a California investor-owned utility (including Southern California Edison and San Diego Gas & Electric) would share responsibility for paying $460 million per year in operating costs and $300 million per year in replacement power costs for Diablo Canyon, which previously recovered all its costs from customers of PG&E, the plant’s owner.

The bill includes no reference to the settlement agreement governing the plant’s retirement in 2025, which was reached in 2016 by diverse parties and endorsed by the legislature almost unanimously in 2018. Nor does it mention PG&E’s June 2022 decarbonization strategy, which conspicuously omits any reference to changes in Diablo Canyon’s retirement schedule.

The California Energy Commission held a workshop on August 12 to receive public comment on the future of Diablo Canyon, and posted a PowerPoint presentation indicating that at times of peak summer consumption the state will need additional resources to maintain reliable service in September 2025 and beyond, and more if wildfires and extended heatwaves coincide. But the presentation conspicuously lacks any analysis showing that Diablo Canyon should be among the winners in a competitive long-term procurement process that has yet to take place. On the face of it, this seems unlikely, since Diablo Canyon lacks any of the flexible operating characteristics that would be most valuable in any resource acquired to meet temporary summertime demand surges. Moreover, in our last experience with severe grid stresses over multiple months (the electricity crisis of 2000-2001), California drew first and foremost on demand-side resources, cutting electricity use by more than 12 percent (4,800 MW) in just a few months. The proposed Diablo Canyon bill does not so much as mention accelerated energy efficiency or demand response measures as a potential response to reliability needs.

Late August in Sacramento is notorious for ill-considered proposals that could never survive rigorous analysis or inclusive public review and are never seen again. This one richly deserves the same treatment.  

About the Authors

Ralph Cavanagh

Energy Co-Director, Climate & Clean Energy Program

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