Keeping Diablo Canyon open could cost ratepayers more than $20 billion, report says

Keeping California’s last nuclear power plant running past 2025 could cost ratepayers $20 billion to $45 billion, according to a new report by a nonprofit environmental organization.

The Environmental Working Group’s report, published Tuesday morning, analyzed how expensive it could be for PG&E’s 15.8 million ratepayers to have Diablo Canyon Power Plant remain open through 2045.

The nonprofit organization, which is based in Washington, D.C., looked at the 20-year timeline because PG&E has said it will apply to renew the power plant’s license for the next 20 years with the U.S. Nuclear Regulatory Commission by the end of this year.

Located just north of Avila Beach in San Luis Obispo County, Diablo Canyon produces about 9% of the state’s total power.

The 2,200-megawatt power plant was expected to stop operating its twin reactors in 2024 and 2025, and be replaced by renewable energy sources. However, the state failed to ensure grid reliability during a time of increased energy demand due in part to climate change.

Senate Bill 846, signed by California Gov. Gavin Newsom in September, allowed for a $1.4 billion loan to be allocated to PG&E to help fund the continued operations of Diablo Canyon.

The Senate bill pushes to keep the nuclear power plant operating until 2030 — giving the state another five years to try to procure enough renewable energy to fully replace Diablo Canyon

The Environmental Working Group report released Tuesday claims that keeping Diablo Canyon open for 20 additional years is not worth the cost to PG&E ratepayers.

“The tens of billions it will cost to keep Diablo Canyon operating will ultimately be borne by PG&E’s ratepayers, who already pay some of the highest electricity bills in the country, while the monopoly’s shareholders will reap additional profits,” the group’s president, Ken Cook, said.

Report: PG&E customers could pay $55 to $124 more per year

To come up with its estimate of the cost of keeping Diablo Canyon operating until 2045, the Environmental Working Group used estimates of the plant’s capital and operating costs from a June report by the Utility Reform Network, a San Francisco-based consumer advocacy organization.

Based on PG&E’s cost estimates for the power plant, it would cost $20 billion to keep the plant operational through 2045, The Environmental Working Group said in its report.

However, the nonprofit surmised, the utility company could be underestimating the costs.

Therefore, the Environmental Working Group used annual operating cost estimates by the Utility Reform Network to calculate the total operating cost until 2045 to be $45 billion.

Those costs, divided equally among PG&E’s customers, would mean ratepayers would see their bills increase by $55 to $124 a year, or $4.49 to $10.33 a month, according to the Environmental Working Group’s analysis.

The cost increase estimates by the Environmental Working Group are entirely speculative, Grant Smith, the group’s senior energy advisor, told The Tribune.

It’s likely the actual increased cost of keeping Diablo Canyon would be different for each ratepayer based on their normal electricity bills from PG&E, he said.

Whether the power plant stays open until 2030 could also change how much ratepayers’ bills increase, he added.

State to analyze costs of continued Diablo Canyon operations

As part of its requirements under SB 846, the California Energy Commission is evaluating the costs of keeping Diablo Canyon nuclear power plant open past 2025. The agency is expected to release a report on its findings by Sept. 30.

Meanwhile, the California Public Utilities Commission has an active proceeding to implement the various stipulations outlined in the Senate bill, which include potential costs to be incurred by ratepayers should the power plant remain open past 2025.

The Environmental Working Group’s report states that Diablo Canyon should not continue to operate past its originally scheduled closure dates in 2024 and 2025, especially given the additional costs to ratepayers.

“We do not see how keeping Diablo Canyon online will save ratepayers money, as its supporters claim,” Smith said. “These costs are also entirely avoidable, because the power this problematic plant generates could easily be replaced by new clean energy investments.”

The group’s report comes two years after a study by Stanford University and Massachusetts Institute of Technology said keeping the nuclear power plant open through 2045 could save ratepayers $21 billion.

However, those savings came because keeping Diablo Canyon operating would reduce how much money would need to be spent on using natural gas and procuring other renewable energy sources, according to the study.

Proponents for keeping Diablo Canyon open say the nuclear power plant is operating safely and helps ensure the state has a reliable electricity grid while it works toward meeting its renewable energy goals.

Public forums to discuss future of nuclear power plant

The California Public Utilities Commission is set to hold online public forums to discuss the potential extended life of Diablo Canyon.

The forums, which will be held at 2 and 6 p.m. Tuesday, will begin with a brief presentation from agency staff. Then the floor will be opened for public comment.

The forums can be accessed via adminmonitor.com/ca/cpuc.

To make a public comment, tune in via phone at 800-857-1917, and dial 1767567# for the passcode.

You can submit written public comment online at apps.cpuc.ca.gov/c/R2301007.