The manager of California's electricity grid has started looking at what will happen if a troubled San Diego County nuclear plant cannot be restarted.

California's Independent System Operator (ISO) is studying what changes would be needed if the San Onofre Nuclear Generating Station remained closed for five years. It is researching less severe situations as well, including if the plant stays offline into next summer or if it is brought back at lower power.

"We're already beginning to run different scenarios of what life would be without the units," said ISO spokesman Steven Greenlee, who characterized the work as part of normal forecasting. "We plan for all of these scenarios, and then we take action in order to ensure the reliability of the grid."

The research takes place as plant operator Southern California Edison Co. analyzes what it will take to get San Onofre running again.

The facility in northern San Diego County has been closed since Jan. 31, when a radiation leak occurred in the Unit 3 steam generator. The Unit 2 generator had been shut down earlier that month for routine maintenance and was not put back online because of a Nuclear Regulatory Commission investigation.

Major work might be needed to get San Onofre operating at full power, Edison told investors this week.

"It is not clear at this time whether Unit 3 will be able to restart without extensive additional repairs," Edison said in its quarterly report to the Securities and Exchange Commission.

While Unit 2 is less impaired, there is no assurance it can be restarted anytime soon, the company said.

Edison is evaluating "what repairs, if any, could be undertaken to restore the steam generators to their originally specified capabilities safely," it said in the filing, "but it has not determined what those repairs might be, or whether the generators will need to be replaced for the units to operate at their prior output levels."

The generators made by Mitsubishi Heavy Industries Inc. have suffered rapid degradation with heavy wear on many tubes. Investigators said poor equipment design and a faulty computer program created a situation where tubes vibrated and knocked against each other. That allowed radioactive reactor coolant to leak (Greenwire, June 19).

Any action that would permit a restart of one or both generators would need to address the factors that led to the early wear, Edison said in its filing.

Edison has submitted paperwork to the ISO and California Public Utilities Commission (CPUC) saying it planned to fire up Unit 2 in November and Unit 3 in December. But those dates were only "for planning purposes," said Edison spokesman Scott Andresen.

In fact, the utility submitted the schedule because restart dates it had provided earlier were going to pass without the plant reopening.

The Nuclear Regulatory Commission must give approval before San Onofre can reopen.

First report due soon

San Onofre provided enough power to juice 1.4 million homes. It also allowed the grid manager to import more power, Greenlee said, because energy must be flowing on the system before additional electricity can be brought in.

San Onofre's closure forced the ISO to create a backup plan, which included asking for the restart of two retired AES Corp. natural gas units in Huntington Beach, Calif. (Greenwire, July 16).

As it looks ahead, the ISO is evaluating a number of possible San Onofre futures, including that both generators remain shut down and that Unit 3 is closed but Unit 2 reopens, Greenlee said.

The ISO also will consider the possibility that the Diablo Canyon Power Plant in San Luis Obispo, Calif., isn't running as part of its analysis. There is no reason to believe that would happen, Greenlee said, but the ISO must plan for all possibilities.

"With the nuclear plants, we're adding in an extra worst-case scenario with them," Greenlee said, "and that would be not having them."

ISO's studies do not indicate that problems at San Onofre are more serious than Edison has acknowledged, Andresen said.

The ISO's "job is to forecast and plan for contingencies," Andresen said. "That's what they're doing. For them, that's the prudent thing to do. They plan the system.

"Our goal is to bring these units back online," Andresen added. "We're working on the plan to do that."

The ISO study looking at a shutdown that lasts into next summer is expected to be completed within a few weeks, Greenlee said. The longer-term one examining a five-year closure will be completed in December. Recommendations in both reports will be folded into the grid manager's 2012-2013 transmission plan.

Shutdown costs build

The closure, meanwhile, has cost Edison $165 million, and the tab is still growing.

The utility disclosed in its financial filing that through June it spent $48 million on repairs and inspections at San Onofre, plus $117 million to buy needed replacement power.

Edison expects to spend at least $25 million more on repairs before the generators can be restarted.

If one or both of the generators need to be replaced, the total tab for the outage could climb past $1 billion, said Dan Hirsch, who lectures on nuclear power at University of California, Santa Cruz.

Edison paid $665 million, including inflation, for the generators that were installed as replacements in 2009 and 2010. They were supposed to last 40 years.

It is too soon to say what the total bill will look like or who will have to pay it, Andresen said.

"We'll look to recover those costs at a future time," Andresen said.

Edison owns more than 78 percent of the plant. San Diego Gas & Electric Co. has a 20 percent share and the city of Riverside, Calif., less than 2 percent. If it wanted electricity ratepayers to cover the expenses, Edison would need to seek approval from the CPUC.

The cost of the replacement power is recoverable, Andresen said, but CPUC must decide if it is reasonable.

CPUC yesterday delayed a vote on opening an investigation into the shutdown. The commission now will consider it at an Aug. 23 meeting.

Edison is facing an upcoming CPUC deadline that could affect San Onofre. If a plant is closed nine months, the commission must open an inquiry into whether it is needed.

"Sometime this fall that [nine-month] clock runs out," Hirsch said. "That's a big deal for Edison that they would like to avoid."