Group re­v­erses stance on San Onofre

The Util­ity Re­form Net­work no longer backs $ 4.7- bil­lion plant shut­down deal.

Los Angeles Times - - BUSINESS - By Jeff McDon­ald

The San Fran­cisco con­sumer group that helped bro­ker the $ 4.7- bil­lion deal di­vid­ing costs for the shut­down of the San Onofre nu­clear plant said Wed­nes­day that it no longer sup­ports the agree­ment and called on reg­u­la­tors to re­open talks.

In a f ive- page mo­tion sub­mit­ted to the Cal­i­for­nia Public Util­i­ties Com­mis­sion, the Util­ity Re­form Net­work said re­cent rev­e­la­tions of back chan­nel com­mu­ni­ca­tions be­tween reg­u­la­tors and util­ity ex­ec­u­tives forced the or­ga­ni­za­tion to re­think its po­si­tion.

The group hopes for a bet­ter deal for South­ern Cal­i­for­nia Edi­son and San Diego Gas & Elec­tric Co. ratepay­ers who were as­signed to cover $ 3.3 bil­lion of the shut­down costs, or 70%, even though Edi­son in­stalled the faulty re­place­ment steam gen­er­a­tors that caused the Jan­uary 2012 shut­down.

The fil­ing is a ma­jor turn­around for TURN. The non­profit de­fended the San Onofre deal for months, even as ev­i­dence mounted that the agree­ment was hatched dur­ing a se­cret 2013 meet­ing in War­saw, Poland, be­tween for­mer com­mis­sion Pres­i­dent Michael Peevey and an Edi­son ex­ec­u­tive.

Notes jot­ted down at the meet­ing have be­come part of state and fed­eral crim­i­nal in­ves­ti­ga­tions into pos­si­ble fa­voritism of util­ity ex­ec­u­tives by the reg­u­la­tors en­trusted to over­see them.

“TURN agrees that re­cent dis­clo­sures de­tail­ing ex­ten­sive com­mu­ni­ca­tions be­tween SCE and CPUC de­ci­sion- mak­ers dur­ing the pen­dency of this pro­ceed­ing are very trou­bling,” the fil­ing states. “TURN was a good faith par­tic­i­pant in the set­tle­ment ne­go­ti­a­tions, and was not aware of the War­saw note, the pri­vate meet­ing, or any agree­ment be­tween Mr. Peevey and SCE at any time be­fore or dur­ing the ex­tended set­tle­ment ne­go­ti­a­tions that led to the pro­posed set­tle­ment.”

The com­mis­sion did not re­spond to ques­tions Wed­nes­day. Edi­son is­sued a state­ment say­ing it is dis­ap­pointed in the TURN de­ci­sion.

“The set­tle­ment it ne­go­ti­ated with con­sumer groups is fair and rea­son-

able, was prop­erly ne­go­ti­ated and is in the public in­ter­est,” Edi­son spokes­woman Mau­reen Brown said.

Law­mak­ers and other con­sumer groups have em­braced the idea of re­open­ing de­bate over how to re­solve shut­down costs for San Onofre.

In April, Sen. Ben Hueso called for the San Onofre deal to be re­con­sid­ered, say­ing it was im­prop­erly lop­sided in fa­vor of util­i­ties over ratepay­ers.

“I do not think the set­tle­ment should stand,” said Hueso, a San Diego Demo­crat who chairs the Se­nate Com­mit­tee on Energy, Util­i­ties and Com­mu­ni­ca­tions. “The process by which the set­tle­ment was de­vel­oped — pre­vi­ously undis­closed pri­vate meet­ings half a world away — clearly is trou­bling.”

Two days later, the com­mis­sion’s Of­fice of Ratepayer Ad­vo­cates — another party to the set­tle­ment — said ratepay­ers should get $ 648 mil­lion more from Edi­son and mi­nor­ity plant owner San Diego Gas & Elec­tric. The of­fice stopped short of say­ing the agree­ment should be re­opened.

The of­fice’s act­ing di­rec­tor, Joseph Como, stood by that rec­om­men­da­tion Wed­nes­day, say­ing he is wor­ried that scrap­ping the set­tle­ment could lead to an out­come even less fa­vor­able to util­ity cus­tomers.

“If it gets opened up, I don’t think ratepay­ers are go­ing to fare any bet­ter,” he said. “But I do think Edi­son should be pun­ished, so I’m go­ing to re­new my call for the $ 648- mil­lion penalty. It should be a re­fund to the ratepay­ers.”

Assem­bly­man An­thony Ren­don ( D- Lake­wood), who chairs the lower house’s Com­mit­tee on Util­i­ties and Com­merce, said TURN’s changed stance is sig­nif­i­cant. “One of the set­tling par­ties see­ing the light on the San Onofre case is a strong state­ment about the ques­tion­able man­ner the set­tle­ment was ne­go­ti­ated,” Ren­don said. “A more open and trans­par­ent res­o­lu­tion to the set­tle­ment would be a healthy step to­ward the PUC re­gain­ing public con­fi­dence in its oper­a­tions.”

Other con­sumer ad­vo­cates were grate­ful that TURN changed its mind.

Edi­son’s “one- sided ac- cess to CPUC de­ci­sion- mak­ers and re­fusal to make legally re­quired dis­clo­sures poi­soned the re­sult­ing set­tle­ment,” said John Geesman, an at­tor­ney for the Al­liance for Nu­clear Re­spon­si­bil­ity. “Now the com­mis­sion needs to de­cide what to do with this stink­ing mess.”

The dis­pute dates from Jan­uary 2012, when f lawed re­place­ment steam gen­er­a­tors at the San Onofre Nu­clear Gen­er­at­ing Sta­tion leaked ra­di­a­tion and forced the plant to shut down.

It never pro­duced another spark of elec­tric­ity. Edi­son an­nounced in June 2013 that the plant would be closed for good. That an­nounce­ment came a lit­tle more than two months af­ter Peevey and for­mer Edi­son ex­ec­u­tive Stephen Pick­ett met se­cretly at the lux­ury Ho­tel Bristol War­saw to dis­cuss the shut­down.

The two men hashed out deal points on ho­tel sta­tionery, meet­ing notes that were seized dur­ing a search of Peevey’s Los An­ge­les area home in late Jan­uary.

The terms listed on the two pages of “RSG notes” are largely sim­i­lar to the agree­ment reached be­tween TURN and Edi­son, which be­gan dis­cussing a set­tle­ment in June 2013.

Edi­son dis­closed the War­saw meet­ing in Fe­bru­ary of this year. The util­ity said new in­for­ma­tion prompted ex­ec­u­tives to re­al­ize the meet­ing should have been re­ported nearly two years ear­lier.

In its f il­ing Wed­nes­day, TURN com­plained that Edi­son with­held key in­for­ma­tion dur­ing set­tle­ment ne­go­ti­a­tions, mainly that the util­ity al­ready reached a set­tle­ment frame­work with the com­mis­sion pres­i­dent be­fore its dis­cus­sions be­gan.

Com­mis­sion­ers are sup­posed to make de­ci­sions based on the public record, and “ex parte” com­mu­ni­ca­tions that could prej­u­dice their de­ci­sion- mak­ing are sup­posed to be dis­closed within three days, not years later. The agency re­ceived a re­port on its prac­tices this week from an out­side law f irm, which found wide­spread rule vi­o­la­tions are com­mon and pri­vate ex­ec­u­tives are rou­tinely fa­vored over the public in­ter­est.

Don Bartletti Los An­ge­les Times

UN­DER an agree­ment, South­ern Cal­i­for­nia Edi­son and San Diego Gas & Elec­tric Co. ratepay­ers would pay $ 3.3 bil­lion of the San Onofre shut­down costs, or 70%. Edi­son says the deal is “fair and rea­son­able.”

Newspapers in English

Newspapers from USA

© PressReader. All rights reserved.