U.S. Sen. Barbara Boxer (D-CA) and others are politicizing the almost 18-month shutdown of the San Onofre Nuclear Generating Station (SONGS) in Southern California, Edison International CEO Ted Craver said Wednesday. The “favorable economics” for restarting the 2,200 MW plant are diminishing with the passage of time and no action by federal regulators, he told financial analysts in New York City.
SONGS, the largest baseload source of electricity in Southern California, is operated by Edison’s Southern California Edison Co. (SCE), the majority owner/operator. In its absence, SCE is running up a bill that approached about $500 million at the end of 1Q2013 for purchasing replacement power supplies, mostly from natural gas-fired generation (see Daily GPI, May 29).
While the U.S. Nuclear Regulatory Commission (NRC) continues to review SCE’s request to restart Unit 2, one of two downed units at 70% capacity for five months, Boxer on Tuesday released 2004 letters from an Edison utility executive that she said is cause to have the U.S. Department of Justice investigate possible wrongdoing by the utility.
“We’ve clearly signaled that we cannot wait indefinitely for a decision to restart Unit 2,” Craver said at the Sanford C. Bernstein & Co. Strategic Decisions Conference 2013. “As time marches on, the fact that a safe restart of the unit would be in the most economical for our customers becomes a diminishing advantage compared to other approaches, such as buying power on the open market or building new generation and transmission.”
Craver was asked if state regulation was becoming more troublesome, but he deflected that, saying that most of the “politicization” of SONGS was not from the California Public Utilities Commission. “Elected officials, however, have more of a responsibility and may have more of a need to respond to these issues.” Boxer has “weighed in heavily” and “raised a number of issues concerning the wisdom of restarting the plant.”
Boxer is questioning SCE’s handling of regulatory requests for its 2008-09 changeout of four steam generators at the two SONGS units. She has correspondence between the utility and Mitsubishi Heavy Industries, which built the units and is now in a legal fight with the utility over how much responsibility it has for the failure of critical tubing in the generators.
SCE’s handling of the new steam generators was “nothing unusual or untoward; we did what the industry has been doing for some time,” Craver said. Further, he won’t “trade barbs” with Boxer regarding allegations of the utility “intentionally misleading” the NRC. “I am not going to get into what really constitutes deceitful behavior; I’ll leave that for someone else. We continue to believe that we have acted responsibly and reasonably, and ultimately we should receive full regulatory recovery for the costs we have incurred and the investment we have made.”
Craver pointed out that when SONGS Unit 1 was retired more than two decades ago before its license to operate had expired, SCE received full cost recovery from state regulators.
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