By Eric Heinz
The California Public Utilities Commission (CPUC) announced on Thursday, July 26, that it had approved the re-opened settlement agreement regarding the shutdown and decommissioning costs of San Onofre Nuclear Generating Station (SONGS).
Just before the 10-day limit to accept the settlement modifications made by the CPUC, Southern California Edison, the majority stakeholder and operator of SONGS, sent out a notice on Twitter saying the modifications had been accepted by all parties involved on Thursday, Aug. 2.
— SCE_SONGS (@SCE_SONGS) August 3, 2018
San Diego Gas & Electric owns 20 percent of SONGS.
The settlement was re-opened in 2016, after it was found in 2015 that then-CPUC President Michael Peevey and then-Southern California Edison (SCE) vice president Stephen Pickett had met in Warsaw, Poland and struck a deal on the payment of the project, which was found to violate certain ethical procedures of the CPUC.
Lawsuits were filed by ratepayer advocacy groups to reconsider how much people who used the power should pay.
On May 9, 2016, the CPUC re-opened the record of a SONGS settlement agreement it approved in November 2014 following the “premature shutdown” of the plant after a steam generator tube leak in 2012.
“Today’s decision is the result of the re-opening of the settlement,” a press release from the CPUC read. “It approves, with modification, a 2018 settlement agreement between multiple parties and should save ratepayers approximately $750 million. The 2018 settlement as modified removes provisions that the CPUC found not to be in the public interest. The 2018 settlement should resolve all outstanding rate issues concerning the premature closure of SONGS. The settling parties have 10 days in which to accept or reject this modification. Once the new agreement is accepted, the additional ratepayer savings would take effect immediately.”
The settling parties proposed in January that customers of SCE and San Diego Gas & Electric, a co-owner of San Onofre, no longer pay for the $775 million in San Onofre-related investments that had not been recovered by the utilities. SCE and SDG&E have already provided more than $2 billion in customer savings under a prior settlement approved by the commission in 2014.
Ray Lutz, the executive director of Citizens Oversight Projects, Inc. (COPS), said his organization litigated over the specific dates and values that they saw to be fair for the public.
“COPs continues to support the settlement as it represents a huge benefit to the ratepayer with a definite early stop date for any payments to the utility for the shuttered plant, amounting to at least a $775 million benefit over the prior settlement,” Lutz said. “The settlement process was clean and included all parties who wished to participate. In addition to the benefit to the ratepayer, it is a benefit to move past the squabble over the closure costs and concentrate on the conversion to renewable energy sources and to properly deal with the nuclear waste left on the site.
“One of our key goals of the new settlement was have it be final; it has to be done and clear and there was all these buckets moving around,” Lutz. “It comes down to when are we going to stop paying (SONGS)?”
Charles Langley, the executive director of Public Watchdogs, said the settlement didn’t go far enough to bring equity to ratepayers who were on the hook for about $3.4 billion of the $5.6 billion in decommissioning costs before the settlement.
“What we are seeing is a complete failure of our regulators to enforce the law,” Langley said in a statement. “This settlement is the official approval of a criminal conspiracy involving fraud upon the court that was hatched in a hotel room in Warsaw, Poland.”
Langley said the settlement gave an undeserving $5.4 million in attorney fees to the litigants who fought for the agreement changes.
Ron Nichols, president of SCE, said the utility provider was considering the modifications on July 27, but that’s now been settled.
“The decision endorses the rate provisions of the revised settlement, but requires the removal of a provision that would have provided funding for university-conducted greenhouse gas research,” Nichols said in a statement at the time.
In another press release distributed Aug. 2, Nichols outlined some of the details that ratepayers can expect to see.
“Today’s decision means we can begin delivering the benefits to customers that settling parties proposed seven months ago,” Nichols said. “We’re pleased to bring closure to this issue following the diligent efforts over many months by the parties.”
Nichols said ratepayers will receive a “one-time bill credit” that will amount to about $11 per average residential customer and a 2 percent monthly average bill reduction, “which equals about $2 per month for an average residential customer.”
Commercial and other rates will vary, he said. The changes are expected to be reflected in customer bills beginning in September.
CEP Meeting Scheduled for Aug. 9
The Community Engagement Panel (CEP) is scheduled to meet at 5:30 p.m. on Thursday, Aug. 9, at the QLN Learning Center, located at 1938 Avenida del Oro in Oceanside.
Gary Lanthrum, a former director of the National Transportation Program for Yucca Mountain, is expected to give an overview presentation of current practices for transporting used nuclear fuel in the United States.
Article updated at 6:20 p.m. on Thursday, Aug. 2
Article updated at 11:15 p.m. on Thursday, Aug. 2 to update the timing and continuity of SCE president Ron Nichols’ statements