SONGS settlement should stand, state regulator told

16 August 2017

Southern California Edison (SCE) has notified the California Public Utilities Commission (CPUC) that the parties in the San Onofre nuclear plant closure settlement were unable to reach agreement on possible changes the CPUC had unanimously approved in 2014. SCE has urged the commission to "affirm the existing settlement of issues related to the premature retirement of San Onofre in 2013 and bring closure to this protracted proceeding".

SONGS aerial - 460 (SCE)
San Onofre (Image: SCE)

SCE retired the San Onofre Nuclear Generating Station - also known as SONGS - in June 2013 after a contractor provided faulty steam generators. The plant is now undergoing decommissioning, with major dismantlement work expected to begin next year. Located on the Pacific coast of California, in the northwestern corner of San Diego County, the plant is owned by Edison International, parent of SCE, with 78.2%, San Diego Gas & Electric Company, 20%, and the City of Riverside Utilities Department, 1.8%.

An international arbitration panel in March ordered Mitsubishi Heavy Industries to pay the owners of SONGS $125 million for defective steam generators supplied to the plant in 2009 and 2010. The four replacement steam generators Mitsubishi supplied for units 2 and 3 of the plant were intended to enable the pressurised water reactors to continue operating until 2022, but were found to be suffering from excessive wear after less than one year in service. Both reactors were taken offline in early 2012 only to be closed permanently in June 2013 when SCE decided not to continue a protracted regulatory process to show that lower power operation would be safe.

SCE's filing yesterday was in response to an order last December by a commissioner and commission administrative law judge that the settlement parties and other parties to the San Onofre proceeding meet and consider changes to the agreement. The company said the parties had met three times directly and then four times with a mediator, and additionally talked by telephone "multiple times", but were unable to agree on changes to the settlement that allocated San Onofre closure costs between utility investors and customers.

SCE president Ron Nichols said the closure settlement was appropriate and should stand. "It ensured our customers do not pay for the faulty steam generators from the time they failed and the plant was no longer providing power," he added.

The settlement also significantly reduced the portion SCE customers are paying in their monthly bills for past investments to build and maintain SONGS over the 30 years the plant was in operation.

"Based on our new economic analysis, customers are paying about $760 million less in their bills than they would have if San Onofre continued to operate through the end of its licence in 2022," Nichols said. The analysis reflects the "dramatic and sustained" drop in energy market prices over the past four years that has affected the economics of many US nuclear reactors, SCE said.

SCE and San Diego Gas & Electric, have already returned more than $2 billion to customers under the 2014 settlement, SCE said.

Researched and written
by World Nuclear News