The passage of Senate Bill 846 to extend the life of Diablo Canyon was extremely disappointing.
It is important to distill the parts of the bill that create some leverage as we continue to pursue avenues to keep the plant on track to close by 2025.
We’ve broken down the good and bad parts of the bill. While the good news isn’t exactly “Good News,” it does provide some guardrails by which we can hold lawmakers accountable.
The Horrifying News
In the pre-dawn hours of September 1, the California State Legislature voted almost unanimously to keep Diablo Canyon’s two aging nuclear reactors running for five more years beyond the end of their current licenses – until October 31, 2029 for Unit 1 and until October 31, 2030 for Unit 2. (Happy Early Halloween!) The one ray of sunshine in this news is that Governor Newsom had proposed to keep them open for TEN more years.
For Governor Newsom to get his wish to keep Diablo running as cover to prevent a stain on his political persona in the event of power outages, he employed a ruthless cudgel, threatening lawmakers that he would veto their climate bills if they didn’t support SB 846.
This rough and tumble political chess game created the wedge that Newsom needed to get the majority of the Senators and Assembly members on board to vote in favor of keeping Diablo running. While at the end of the day, there were some concessions, the bottom line is we have to keep battling to close this toxic, dangerous plant by its scheduled closing by 2025.
The Bad News
Extend Operation for 5 Years: The bill extends operation for a period of 5 years until October 31, 2029 for Unit 1, and October 31, 2030 for Unit 2.
- Joint Agreement is Nullified: It invalidates a 2018 CPUC decision detailing the retirement of DCPP and its decommissioning plan. It orders the CPUC to reopen PG&E’s 2016 application to retire DCPP in order to implement its extension.
- A Forgivable Loan: SB 846 includes the Governor’s prior proposal for a forgivable “loan” of up to $1.4 billion to PG&E for the extended operation of Diablo Canyon, to be disbursed to PG&E in tranches, not in a lump sum.
- California Environmental Quality Act (CEQA) Reviews Eliminated: Diablo is categorized as an “existing facility” for purposes of CEQA, thereby eliminating environmental review of any project on the Diablo site.
- Once-Through Cooling Exempt from Environmental Review: SB 846 allows continued use of the existing once-through cooling system at Diablo Canyon. It exempts the facility from any environmental review under CEQA. The bill sets a NEW final compliance date for the once-through cooling system of October 31, 2030. This defies federal law.
- Expedited Review: The bill requires any necessary state agency actions be completed within 180 days, playing havoc with due diligence.
- Runaway Profits: There is still no cap on the $7/MWh “performance-based distribution” paid out of the loan; includes a management fee of $100 million a year; the volumetric fee was reduced from $20 to $13/MWh – but still not good enough.
- All Californians Will Pay: Net of costs covered by loan disbursements and federal subsidies will be recovered via non‑bypassable charges from the customers of all CPUC-jurisdictional load-serving entities statewide (i.e., not just customers in PG&E’s service territory).
- PG&E Customers Hit: A separate surcharge is applicable only to customers in PG&E’s service territory, “in lieu of a rate-based return on investment,” to compensate PG&E for “the greater risk of outages of an older plant” like Diablo Canyon.
The Good News
There are guardrails in the Bill.
- Must be Cost Effective: The $1.4 billion loan payouts would be conditioned upon review to ensure that any seismic safety, irradiated spent fuel storage capacity and other safety modifications are a cost-effective means to meet California’s mid-term reliability needs.
- Money Paid in Tranches: The bill prohibits the Department of Water Resources (DWR) from releasing the funds in a lump sum; rather, disbursement of the loan must occur in tranches contingent upon a semiannual review of costs.
- Renewals: The loan will be immediately terminated or suspended if DWR determines PG&E has not obtained the necessary license renewals, permits, and approvals – or that the conditions and timeframes for such licenses are too onerous or will generate costs that exceed $1.4 billion.
- Adequate Renewables: The CPUC would be authorized to reinstate the 2024/2025 closure dates if it finds that new renewable energy and zero-carbon resources are adequate to substitute for Diablo Canyon. Along with that, if the state’s planning standards for energy reliability have already been constructed and interconnected by the time of its decision, the CPUC can close the plant.
- Safety Committee is Codified: The Bill codifies the Diablo Canyon Independent Safety Committee (DCISC), which was established under a 1988 CPUC decision. The Safety Committee conducts examinations of the Diablo Canyon site and conducts triennial public meetings.
- $1 Billion for Clean Energy: The bill provides $1B to support a Clean Energy Reliability Investment Plan to be administered by the California Energy Commission and streamlines the need determination process for new transmission projects.
Governor Newsom used these Bills as political leverage;
they include some important climate wins for California
- SB1137 by Senator Lena Gonzalez, D-Long Beach, bans new oil wells and extraction facilities within 3,200 feet — or more than a half mile — of homes, schools and parks.
- SB1020 by State Senator John Laird, D-Santa Cruz, creates interim targets to ensure the state hits its goal of generating 100% clean electricity by 2045, with targets of 90% by 2035 and 95% by 2040. The new law also requires all state agencies to get their power from renewables by 2035.
- AB1279 by Assembly Member Al Muratsuchi, D-Torrance (Los Angeles County), creates a legally binding goal that the state must achieve carbon neutrality — meaning the state either eliminates or captures all of its greenhouse gas emissions — by no later than 2045. It would also require the state to reduce greenhouse gas emissions by at least 85% below 1990 levels in that timeframe.
- AB 1757, introduced by assembly members Cristina Garcia and Robert Rivas, encourages nature-based carbon sequestration: planting more trees, restoring wetlands, and scaling up public landscaping and urban forestry projects.
- SB905 by Senator Anna Caballero, D-Merced, creates regulations to permit and monitor controversial new technologies that aim to capture carbon from the air and sequester it in underground caverns.
- California Air Resources Board issued an order requiring all new cars sold in California to be zero-emissions electric vehicles by 2035.