A California regulator has authorized Southern California Edison to withdraw $405.5 million this year from the trusts that will pay for decommissioning of the San Onofre Nuclear Generating Station (SONGS).
The March 6 decision from the California Public Utilities Commission (CPUC) rejects a challenge from a state watchdog organization, even though Southern California Edison acknowledged that its forecast cost for the year is $260.1 million higher in 2020 dollars than what it estimated three years ago.
The utility is the majority owner and federal licensee for the retired nuclear power plant in San Diego County. Its planned expenditures represent 76% of the expected $535 million in decommissioning spending for 2020. The remaining funding would come from co-owners San Diego Gas and Electric Co. and the city of Riverside, along with the city of Riverside, which previously held a stake in the plant.
Southern California Edison (SCE) in 2013 permanently shuttered the last two operational reactors at the plant, Units 2 and 3, after faulty steam generators were installed in each. In December 2016, it hired SONGS Decommissioning Solutions to manage decommissioning of the two reactors, a $4.4 billion job expected to be complete in 2028.
The plant’s Unit 1 reactor has already been largely decommissioned after closing in 1992.
The utility’s share of the trusts for Unit 2 and 3 stood at $2.3 billion at the end of 2019.
In 2018, the California Public Utilities Commission required SCE to each year file “advice letters” on its upcoming disbursement from the decommissioning trusts for the two reactors. The utility filed its latest update with the regulator on Dec. 4 of last year.
In that document, SCE noted that its share of the 2020 cost had risen from $145.4 million cited in a 2017 decommissioning cost estimate to $405.5 million. The total decommissioning cost for the year had spiked by $343.3 million, from $191.7 million to $535 million. Those are in 2020 dollars. A table in the December filing also noted total costs for the year in 2014 dollars, for comparison against the decommissioning cost estimate issued that year: $166.3 million as of 2017 and $461.8 million in the latest update.
The “variance includes costs for work deferred from 2018 and 2019 to 2020, as well as accelerated from later years into 2020,” according to the December update.
The leading causes of the deferrals, according to SCE, was the delay in certification, to last March, of the final environmental impact report on decommissioning from the California State Lands Commission; and the later-than-anticipated approval of the coastal development permit for on-shore operations by the California Coastal Commission, in October.
Anticipated decommissioning operations in 2020 are grouped into three main areas: decontamination, demolition, and disposal; interim spent fuel storage installation (ISFSI), primarily the transfer of used fuel into dry storage; and other major projects. They would cost $323.6 million in 2014 dollars, rising from the 2017 estimate of $88.1 million. The remaining $138.2 million in 2014 dollars would be distributed between labor-staffing, non-labor, and service level agreements expenses.
San Diego-based Public Watchdogs challenged the Southern California Edison filing on Dec. 20. It accused the utility of “unjustly and unreasonably” increasing this year’s decommissioning expenses and of leaving out or distorting certain facts on the schedule of the state regulatory approvals.
Specifically, according to the advocacy group: Southern California Edison was forced to shutter the reactors because they represented an unlicensed nuclear power plant; the utility itself caused a number of delays in environmental permitting for decommissioning; and some canisters used for on-site dry storage of the reactors’ used fuel had broken bolts.
“None of these issues is relevant to whether 2020 nuclear decommissioning trust funds should be disbursed for SONGS via this advice letter,” according to the March 6 CPUC report.
The commission was also not convinced by Public Watchdogs’ argument that SCE ratepayers are wrongly having to pay for decommissioning after having to pay billions of dollars for the plant’s premature closure. “This is incorrect,” it said, as the cost of decommissioning does not relate directly to the cause of the shutdown.
Public Watchdogs Executive Director Charles Langley said this week he is considering a court appeal of the commission decision.
“We are weighing our options,” he said by email Tuesday. “We are deeply disturbed that the Commission is allowing such a massive and questionable withdrawal without independent review. The Commission claims that if Edison has engaged in overspending, that it will be recognized during the 2021 Triennial Hearing, and that Edison will be required to issue a refund. Our concern is that Edison may be financially unstable, and is using the Nuclear Decommissioning Trust Fund as a ‘get well’ fund for its shareholders and executives.”
Langley’s organization has been highly critical of Southern California Edison’s operation of SONGS, particularly in the wake of an August 2018 mishap in which a canister of used fuel was left at risk of a nearly 20-foot drop while being placed into its dry-storage slot.
That incident led to a nearly yearlong pause in relocating used fuel rods from cooling ponds to the oceanside dry-storage pad, as SCE and offload contractor Holtec International made improvements to the operation. The Nuclear Regulatory Commission fined Southern California Edison $116,000 for breach of federal nuclear safety rules.
Public Watchdogs has in recent months, without success, petitioned the Nuclear Regulatory Commission and a federal court to order a halt to decommissioning and used-fuel transfer operations at SONGS.
