California stakeholders push for community settlement, clean energy in Diablo Canyon oral hearing
- The California Public Utilities Commission on Tuesday heard final oral arguments on Pacific Gas and Electric's planned closure of the Diablo Canyon nuclear facility. At stake are two settlements PG&E struck with a wide range of stakeholders that include replacing the plant with a combination of renewable energy, efficiency and energy storage, and an $85 million commitment to affected communities.
- KCBX reported that 21 organizations and municipalities testified at the oral hearing, with a few worried over the $85 million pledge. Clean energy groups also condemned the proposed decision because it offers no guarantees for how to replace 2.3 GW of capacity with carbon-free resources.
- Administrative Law Judge Peter Allen earlier this year proposed that regulators approve the utility's request to close the plant and allow it to boost rates to cover approximately $170 million in closure costs. However, the ruling nixed PG&E's request to raise rates even higher to cover the $85 million settlement, which would go to San Luis Obispo County and local school districts and cities. A final vote from regulators is expected Dec. 14.
The final oral hearing drew a mix of stakeholders, with a few relaying their concerns about the ALJ's proposed decision scuttling the $85 million settlement, according to media reports. PG&E also came out against the changes made to the community settlement.
PG&E initially proposed the community settlement in November 2016, which would allocate $75 million to an Essential Services Mitigation Fund distributed to San Luis Obispo in nine equal installments through 2025, and create a $10 million Economic Development Fund to ease impacts to surrounding communities.
But the ALJ proposal essentially scraps the community settlement by only guaranteeing a rate increase to cover the plant's closure costs.
PG&E also proposed a $1.3 billion investment in energy efficiency as part of its settlement with environmental groups, but the ALJ deferred approval of this investment, saying it should be addressed in the state's comprehensive planning process instead.
On another front, the decision's lack of guidelines on replacing capacity could result in a similar situation as San Onofre, stakeholders told Greentech Media. Southern California Edison closed that plant after steam leaks were uncovered in 2012; the CPUC did direct SCE and San Diego Gas & Electric to replace part of the capacity with carbon-free resources, but the utilities filled in the gap with natural gas plants as well.
This time, the increased scrutiny from regulators over natural gas buildout could play a part in how PG&E decides to replace Diablo Canyon's capacity. A recent Los Angeles Times investigation left many questioning whether the state is overbuilding natural gas plants. The California ISO agreed earlier this year to examine alternatives to the proposed Puente gas power plant after pressure from lawmakers. Clean energy groups are also advocating the state should pivot to solar, efficiency and storage as a more cost-effective way to meet power needs and reduce emissions.
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