State policies that focus on renewables and energy efficiency, coupled with projected lower customer electricity demand in the future, will result in a significant reduction in the need for the electricity produced by Diablo Canyon Power Plant past 2025.
Reflecting this change, PG&E partnered with labor and leading environmental organizations in 2016 on a joint proposal that would increase investment in energy efficiency and renewables while retiring Diablo Canyon at the end of its current NRC operating licenses, which expire in 2024 and 2025.
The parties to the Diablo Canyon joint proposal include PG&E, International Brotherhood of Electrical Workers Local 1245, Coalition of California Utility Employees, Friends of the Earth, Natural Resources Defense Council, Environment California, California Energy Efficiency Industry Council and Alliance for Nuclear Responsibility.
The parties jointly proposed that Diablo Canyon be replaced with a cost-effective, greenhouse gas-free portfolio of energy efficiency, renewables and other clean energy resources.
Recognizing that the procurement, construction and implementation of this greenhouse gas-free portfolio would take time, the joint parties agreed to support PG&E in obtaining the state approvals needed to operate Diablo Canyon to the expiration of its current NRC operating licenses.
This avoided an early shutdown of Diablo Canyon and associated negative economic and social impacts, including replacing the plant’s output required to meet customer demand with non-greenhouse gas-free resources.
As part of the joint proposal, PG&E immediately ceased any efforts on its part to renew the Diablo Canyon operating licenses, and asked the NRC to suspend consideration of the pending license renewal application. PG&E also committed to withdrawing the application upon CPUC approval of the joint proposal.
PG&E does not believe long-term customer rates will increase as a result of the joint proposal.
The joint proposal included support for a successful transition for Diablo Canyon employees and the greater San Luis Obispo County community.
The $85 million community impact mitigation program was proposed to support the community with its transition and provide funding to support essential public services that the plant and the local community rely upon.
The Diablo Canyon employee program was proposed to provide incentives to retain employees during the remaining operating years of the plant, and a retraining and development program to facilitate redeployment of a portion of plant personnel to the decommissioning project or other positions within the Utility.
The CPUC authorized several elements of the joint proposal in January 2018, including approval to cease plant operations once the NRC operating licenses expire, and funding for employee retraining and redeployment. The CPUC also expressed its intention to avoid any increase in greenhouse gas emissions resulting from the closure of Diablo Canyon.
Full funding of the employee retention program was not approved as part of the CPUC’s January 2018 decision. It also expressed that legislative authorization would be needed to approve the community impact mitigation program.
Senate Bill (SB) 1090 was introduced in the California State Legislature to meet these key remaining goals of the joint proposal. It was approved by the State Senate and State Assembly in 2018 with bipartisan support, and was signed into law by Governor Brown in September 2018. Subsequently the CPUC authorized full funding of the employee retention program and PG&E ratepayer funding for the community impact mitigation program in November 2018.