Calif. governor gives lifeline to state’s last nuclear plant

Source: By Anne C. Mulkern, E&E News • Posted: Monday, August 15, 2022

The Diablo Canyon nuclear power plant in California in 2008.

The Diablo Canyon nuclear power plant in California in 2008. Tracey Adams/Flickr

California Gov. Gavin Newson on Friday officially proposed keeping the state’s last nuclear power plant open five to ten years beyond its planned 2025 final closure date.

The Democratic governor offered legislation that would extend a lifeline to the Diablo Canyon Power Plant located near the Pacific Ocean in San Luis Obispo County. One turbine at the plant currently is set to close in 2024 and the second in 2025. But the state now potentially would loan plant operator Pacific Gas and Electric Co. as much as $1.4 billion to support plant operations.

The extension is needed because climate impacts are hitting faster than expected, Newsom aides said, and extreme heat could push power demand beyond available supplies of electricity, forcing electricity blackouts. Adding more electric vehicles also will increase electricity consumption, they said. Meanwhile, supply chain problems have delayed clean energy projects aimed at replacing the power generated by Diablo Canyon.

“We are behind where we need to be in bringing our clean resources online, to ensure that we can retire” the Diablo Canyon plant, Ana Matosantos, California Department of Finance director, said Friday at a California Energy Commission webinar on the state’s grid reliability. “This is something that we think is necessary to maintain reliability, necessary to make our transition” to a clean energy economy,

The plan comes as the nation’s most populous state wrestles with how to keep the lights on as it eyes a carbon neutral grid by 2045. Newsom on Friday also offered legislation to add new requirements to help reach a 100 percent clean grid. It would create a clean electricity target of 90 percent by 2035 and 95 percent by 2040.

Recent state analyses of electricity supply and demand show the state could see supply shortages in summers through at least 2026, particularly in September. The state Legislature in June passed a budget that included more than $2.2 billion for electricity reliability, which can be used in part to buy power from natural gas plants near the ocean that were previously set to retire.

Newsom approved using those gas plants, even as California wants to cut its greenhouse gas emissions 40 percent below 1990 levels by 2030. Newsom last week also offered a bill to adopt a more aggressive greenhouse gas cutback target. The governor is aiming to slash emissions 55 percent below 1990 levels by 2030.

Keeping Diablo Canyon open longer could help avoid using those natural gas plants, Matosantos said Friday. Closing Diablo Canyon in 2025 would mean the state loses a carbon-free generating plant that serves as many as 3 million homes and businesses.

A Brattle Group analysis released in June said that if Diablo Canyon closes in 2025, the state would need to take multiple steps to assure grid reliability, including adding battery storage at more than three times 2021 levels now through 2026. It would also need to add utility-scale solar annually at roughly three times recent levels, plus ensure that 1 gigawatt of pumped hydro storage and 1 GW of new geothermal arrive by 2026, according to Brattle.

But keeping the plant open is complicated. The planned closures at Diablo Canyon are part of a settlement agreement reached by PG&E, environmental groups and local authorities.

Unwinding that agreement — even to keep the plant open a few more years — would require approval from the California Legislature and four state agencies. The U.S. Nuclear Regulatory Commission would need to issue an operating license renewal. The plant also would need to undergo safety upgrades, state officials have said.

The state Legislature has a very tight window to consider the bill. It would need to pass both chambers by Aug. 31, the last day of the session.

DOE, offshore wind and safety questions

Democratic state Sen. John Laird, who represents the area where Diablo Canyon is located, opposes keeping it open. He said at the Energy Commission webinar last week that he’s concerned about safety, as there has been “substantial deferred maintenance” at the plant as it planned to close.

Additionally, he said, keeping Diablo Canyon open would “require major financial resources.” He questioned whether state taxpayers, federal dollars or utility ratepayers would cover the costs.

PG&E has said it’s considering applying for part of the $6 billion available in the Department of Energy’s Civil Nuclear Credit Program for imperiled nuclear plants. Those funds were allocated through the Infrastructure Investment and Jobs Act.

The utility, asked about Newson’s move, said in a statement: “We understand state leaders’ discussions to potentially extend operations at DCPP are progressing. We are proud of the role that DCPP plays in our state, and we stand ready to support should there be a change in state policy, to help ensure grid reliability for our customers and all Californians at the lowest possible cost.”

Several environmental groups also oppose extending the plant’s life. Environment California, Friends of the Earth and NRDC in a joint statement said the bill proposed by Newsom includes “sweeping exemptions” from multiple state and federal environmental protection laws. In addition, they said, the $1.4 billion loan to PG&E is potentially forgivable, “meaning it may never be returned to California taxpayers.”

V. John White, executive director of the Center for Energy Efficiency and Renewable Technologies, said keeping Diablo Canyon open as long as a decade would hurt Newsom’s goal of adding at least 20 megawatts of offshore wind by 2045. One proposed location for offshore wind is near the Diablo Canyon plant, and electricity would flow through the plant’s transmission line. That couldn’t happen until the plant is closed.

“We are depending on the transmission from Diablo being available no later than 2030, or the Governor’s offshore wind goal is a pipe dream,” White said in an email.

Others praised Newsom’s move.

“To prevent blackouts, save taxpayers billions of dollars and avoid increasing greenhouse gas emissions, California must delay the closure of the state’s largest producer of clean energy: the Diablo Canyon power plant,” said Isabelle Boemeke, founder and executive director at Save Clean Energy, a nonprofit launched last year largely to support keeping Diablo Canyon open.