State regulators propose San Onofre settlement

13 October 2014

Consumers stand to receive refunds and credits totalling $1.3 billion due to the premature closure of the San Onofre nuclear power plant under a settlement proposed by the California Public Utilities Commission (CPUC).

The sun sets at San Onofre
(Image: SCE)

San Onofre's owners Southern California Edison (SCE) and San Diego Gas & Electric (SDG&E) would be forced to stop any further collection from ratepayers of costs for the project to replace the plant's steam generators. The companies would also have to return all costs for the project collected after 31 January, 2012 and accept a "substantially lower return" on other prematurely retired assets at the plant.

The units, majority owned by Southern California Edison (SCE), had been kept off line since the discovery of a leak in a steam generator tube in January 2012. After eight months of regulatory reviews failed to reach a conclusion on if, or when, either unit might be allowed to restart SCE parent company Edison International announced its decision to close the two 30-year-old pressurized water reactors in June 2013. The settlement would effectively mean that customers would pay nothing for the defective steam generators from the day of the tube leak at San Onofre.

The faulty steam generator was installed in 2010 as part of a project to uprate and modernize the plant. SCE&G subsequently launched arbitration proceedings against the supplier of the steam generator, Mitsubishi.

The proposed settlement has been approved by parties including SCE, SDG&E, ratepayer and employee representatives and Friends of the Earth. CPUC commissioner Mike Florio said the proposal would result in "just and reasonable rates" and was in the public interest.

Commissioners are expected to make a decision on the proposed settlement in November.

San Onofre is owned 78% by SCE, 20% by SDG&E and and 2% by the city of Riverside.

Researched and written
by World Nuclear News