PG&E to close Diablo Canyon nuke plant
As utility shifts to a future with more renewables, a nuclear era ends in state
Signaling the end of nuclear power in California, PG&E on Tuesday announced plans to close the Diablo Canyon Power Plant by 2025 as it continues to shift its energy production to solar, wind and other renewables.
The proposal to shut down the state’s last nuclear power facility represents a major leap toward meeting California’s renewable energy mandate. It would bring to a close more
than a half-century of nuclear power generation in the state and could serve as a blueprint for closing other U.S. nuclear facilities.
“PG&E has set a shining example” for phasing out other nuclear plants in the nation, said Ralph Cavanagh, energy program co-director for the Natural Resources Defense Council, one of several environmental and labor groups that struck a deal with PG&E to close the facility on the California coast.
The two 1,100-megawatthour reactors at Diablo Canyon, which began operation in 1973, produce nearly 9 percent of California’s electricity and provide enough power for 3 million people a year.
To replace the lost nuclear power, PG&E plans to expand energy efficiency, its use of renewable energy, and energy storage that would exceed current state mandates. California’s historic 2015 energy law requires that power companies get 50 percent of their electricity from renewable sources, such as solar or wind, by 2030. PG&E aims to produce 55 percent of its power from renewable sources by 2031. At present, about 30 percent of the utility’s electricity comes from renewable sources, said Keith Stephens, a PG&E spokesman. The state requires that utilities reach 33 percent by 2020.
Democratic U.S. Sen. Barbara Boxer praised the plan to close the site, which is perched near Avila Beach along the Central Coast near a network of seismic faults, including the San Andreas Fault.
“The news that nuclear power will be replaced by renewables is heartening,” Boxer said.
The proposal, however, came under immediate fire from groups warning that the loss of the plant would result in higher energy bills if PG&E increases its dependence on natural gas for power generation.
“This proposal would harm PG&E ratepayers, shareholders and employees,” said Michael Shellenberger, president of the advocacy group Environmental Progress. “There is no question this will raise rates for customers.”
Shellenberger noted that Diablo Canyon provides electricity at a cost of about 4.5 cents a kilowatt-hour, and sources such as natural gas, wind and solar tend to be more expensive.
PG&E disagreed, saying monthly bills won’t have to rise to cover the costs of the closure and the switch to other forms of energy.
“There is no need for a cost increase from our customers,” said Geisha Williams, president of electric with the utility subsidiary of PG&E. “We don’t have to replace the full power output of Diablo Canyon because there will be less need for its electricity” because of the state’s energy mandates.
Environmental groups cheered the prospect of an end to the state’s nuclear power age, which began in 1957 when the first plants came online.
“It sets a date for the certain end of nuclear power in California,” said Erich Pica, president of Friends of the Earth, one of the groups involved in the agreement with PG&E. “This agreement will turn California, the sixth-largest economy in the world, into a nuclearfree economy.”
San Francisco-based PG&E intends to phase out the Diablo Canyon reactors when their operating licenses with the U.S. Nuclear Regulatory Commission expire. The license for Unit 1 expires in November 2024, and the license for Unit 2 expires in August 2025.
The utility is taking a forward-looking approach with its proposal to retire the plant, as well as scouting for ways to replace the lost electricity production, environmental activists said.
“This decision by PG&E will help facilitate greater deployment of advanced energy technologies and services to the grid,” said Steve Chadima of Advanced Energy Economy, a national business association.
The utility estimated the costs of closing the plant will include:
$350 million for retention n and other efforts to keep a skilled workforce on hand while the plant winds down.
$50 million to cover n property tax revenue that will evaporate from San Luis Obispo County. The payments will be made over the next nine years.
Undetermined expenses n to replace the nuclear power it will be losing.
“It depends on the procurement costs for the replacement power,” Williams said. “We will seek full rate recovery for that.”
PG&E must clear multiple regulatory hurdles to close Diablo Canyon, including state Public Utilities Commission confirmation that PG&E’s $2 billion investment in Diablo Canyon will be recovered by the time the plant closes.
“California’s energy landscape is changing dramatically with energy efficiency, renewables and storage being central to the state’s energy policy,” said Anthony Earley, PG&E’s chief executive officer. “As we make this transition, Diablo Canyon’s full output will no longer be required.
“This is an unprecedented voluntary commitment by a major U.S. energy company.”