NUCLEAR ENERGY

Owner of beleaguered San Onofre plant throws in the towel

SAN DIEGO -- The San Onofre Nuclear Generating Station, shuttered for 18 months following a leak of radioactive material, will close permanently, its owner said today.

Southern California Edison. (SCE) announced that it no longer would seek to restart the troubled San Diego County plant, which has been the center of heated debate involving Sen. Barbara Boxer (D-Calif.) and environmental groups.

The plant, also known as SONGS, had provided power to 1.4 million homes in the densely populated Southern California region. It also gave voltage support that allowed the grid operator to import more electricity.

"SONGS has served this region for over 40 years," Ted Craver, chairman and CEO of Edison International, parent company of SCE, said in a statement, "but we have concluded that the continuing uncertainty about when or if SONGS might return to service was not good for our customers, our investors, or the need to plan for our region's long-term electricity needs."

The leak occurred in the Unit 3 generator at the plant. It was blamed on a faulty computer program and poor steam quality, which triggered vibrations. That caused heavy tube wear in the Unit 3 generator and some damage in Unit 2. The utility has been criticized for failed planning, and there have been questions about whether the generators were faulty from the inception.

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Boxer has released documents that showed that SCE and generator manufacturer Mitsubishi Heavy Industries knew there could be problem with excessive vibrations. Boxer and environmental groups charged that the companies avoided making changes to the generators to avoid a lengthy Nuclear Regulatory Commission hearing. SCE said there were safety reasons for not making adjustments.

SCE had sought to restart Unit 2 and run it at 70 percent power for five months, after which it would be shut down and inspected. That proposal had been criticized as unsafe by Boxer and green groups.

Last month, the NRC's Atomic Safety and Licensing Board found that Friends of the Earth was entitled to a public hearing in connection with the proposed restart.

"Additional administrative processes and appeals could result in delay of more than a year," SCE said in its statement. "During this period, the costs of maintaining SONGS in a state of readiness to restart, and the costs to replace the power SONGS previously provided, would continue.

"It is uneconomic for SCE and its customers to bear the long-term repair costs for returning SONGS to full power operation without restart of Unit 2. SCE has concluded that efforts are better focused on planning for the replacement generation and transmission resources which will be required for grid reliability."

The state's primary grid operator said it already had been planning on the plant being down this summer, and also had been analyzing the potential of it being permanently offline.

"Obviously, we were not planning on San Onofre being available to the grid this summer," said Stephanie McCorkle, spokeswoman for the California Independent System Operator. "We've been very open that the grid should be in good shape unless we encounter extreme conditions such as heat storms as well as wildfires. There's obviously a chance of both this summer, but we have the mitigation efforts nearly complete.

"The focus now will turn to the long-term mitigation to offset the loss of the permanent closure of San Onofre," McCorkle added.

Customers might be asked to curb their power use when extreme conditions do occur, McCorkle said, as they did during a heat wave last summer (Greenwire, Aug. 10, 2012).

"We'll ask consumers to do their part when we get into those adverse conditions," she said.

Over the past year, California has added more than San Onofre's capacity in new generation, the U.S. Energy Information Administration noted today. The state has added 2,502 MW of capacity and has an additional 891 MW slated to come online by this month. That compares to SONGS' 2,246 MW, the agency said.

But much of the new available power is outside the San Diego-Los Angeles area that the plant served, so transmission upgrades will also be needed.

"This new capacity will help make up for the loss of the generation from SONGS, but the reliability issue is more complicated than simply providing replacement generation," the EIA said.

SCE plans to reconfigure an existing 220-kilovolt transmission line to move more electricity by June 15, EIA said, and should have upgraded several substations by June 1. Also, by June 28 two natural-gas-fired generators at the Huntington Beach, Calif., plant will be converted to synchronous condensers, which generate reactive power. Reactive power is needed to move electricity along the lines and maintain proper voltage.

Who will pay?

The California Public Utilities Commission said it would work with state and regional government entities, especially the ISO, "to ensure Southern California has adequate supply of electricity this summer and into the future. This will require even greater emphasis on energy efficiency and demand response programs, as well as transmission upgrades and enhancements and some new generation resources," the agency said.

CPUC also said it would decide as soon as possible who should bear the costs of the lengthy outage of San Onofre generating Units 2 and 3.

The state agency is looking at whether SCE can charge ratepayers for the $671 million it spent on the steam generators, which were installed in 2010 and 2011 and were supposed to last 40 years. The utility also is seeking to have ratepayers pick up the cost of repairs to the units and replacement power purchased in the interim. The two are estimated at about $300 million.

SCE in its statement today said it estimated it would record a charge in the second quarter of the year of between $450 million and $650 million before taxes or $300 million to $425 million after taxes.

CPUC urged parties in an open agency proceeding on the issue to meet and discuss a joint proposal for permanent shutdown.

A proposed settlement would then be brought to the CPUC for a vote and could "potentially avoid a protracted litigation that could delay refunds to ratepayers and extend uncertainty for electric system planners," the agency said.

Boxer praised the decision.

"I am greatly relieved that the San Onofre nuclear plant will be closed permanently," the Senate Environment and Public Works Committee chairwoman said. "This nuclear plant had a defective redesign and could no longer operate as intended. Modifications to the San Onofre nuclear plant were unsafe and posed a danger to the 8 million people living within 50 miles of the plant."

Boxer had asked the NRC not to approve SCE's request to reopen San Onofre until the agency had completed multiple investigations. She also had pushed for Department of Justice and CPUC inquiries into whether the utility, when it installed the replacement generators, had sought to avoid a NRC scrutiny.

"After a leak of radiation from the steam generator tubes, I became increasingly alarmed that Southern California Edison had misled regulators by minimizing the scope of the changes made at the nuclear plant to avoid a full safety review and public hearings," she said. "That is why I have asked the U.S. Department of Justice, as well as the California Public Utility Commission and the Nuclear Regulatory Commission, to investigate."

Friends of the Earth also lauded the closure.

"This is very good news for the people of Southern California," Erich Pica, president of Friends of the Earth, said in a statement. "We have long said that these reactors are too dangerous to operate and now Edison has agreed. The people of California now have the opportunity to move away from the failed promise of dirty and dangerous nuclear power and replace it with the safe and clean energy provided by the sun and the wind."

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