Financial probe for San Onofre nuclear power plant approved

Investigtion could impact customer charges

IRVINE, Calif. - The California Public Utilities Commission voted Thursday to initiate a formal investigation into the long-term outages at the San Onofre Nuclear Generating Station in northern San Diego County, a move that includes consideration of a refund to utility customers.

The commission, which provides state oversight of the nuclear power plant, voted 5-0 at a meeting in Irvine to initiate the investigation. It's not clear how long the investigation would take.

"The CPUC realizes the importance of the San Onofre nuclear plant to the state of California and the consequences of the problems with the plant for ratepayers and for all effect," commission President Michael R. Peevey said. "This investigation will allow us to address issues related to the outages as part of our responsibility to keep the lights on and keep rates just and reasonable. We will look very critically at the utilities' financial responsibility for the prolonged outage and who should bear those costs."

The commission will consider whether customers of Southern California Edison and San Diego Gas & Electric should continue paying rates for San Onofre and if they are owed a refund dating back to Jan. 1 of this year.

The commission also will investigate what caused the outages, how the utilities responded to the problem that led to the shutdown, and the future safety and reliability of the nuclear power plant, as well as explore if there is insurance or warranty coverage of the losses associated with the shutdown of Units 2 and 3.

The investigation additionally will consider the cost of repairing or replacing one or both Units 2 and 3.

Edison officials said they would see if warranties and insurance can recover the expenses associated with the outages.

Edison "is committed to ensuring the safety and security of critical generation assets such as San Onofre," said the utility's president, Ron Litzinger. "Reliable baseload generation in Southern California is something we need now and in the future."

Irvine City Councilmember Larry Agran told the commission, "By almost any standard as measured by age, geology, or it's operation safety record, San Onofre is the nation's most dangerous and unreliable commercial nuclear power plant.

Many protestors were on hand, including Ray Lutz of the Citizens' Oversight Committee. He told a crowd, "There's no way out of this. There's no safe way out of this. They've got to shut these down. They may talk about it for another 18 months but there's no way it's going to be viable to start these up. Just forget it. I want to see the ratepayers rates cut right away. I don't want to wait for 18 months. Let's get them cut right away."

Donna Gilmore, who represents the San Onofre Safety Organization, said, "These steam generators ... they're so bad. They have decades of wear after being installed less than two years. Decades of wear and one leaked radiation. Are we counting nuclear parts in dog years now? It's time to cut our losses and shut this plant down."

Gene Stone of Residents Organized for a Safe Environment was even more cynical.

"The question is ... Will the PUC work for the good of the public? And their record is atrocious," said Stone.

The plant near the Orange County line has been offline since the end of January, when a leak was discovered in one of the two reactors' two steam-generating tubes. The other unit already was shut down for planned maintenance and has been offline since then.

A subsequent investigation found unusual wear in many of the tubes in both shuttered reactors.

Edison is seeking permission from the Nuclear Regulatory Commission to restart one of its shuttered reactors on a trial basis. A group called Friends of the Earth is opposed to the restart plan, questioning whether the plant is safe for the environment and residents living in its vicinity.

On Sunday, a hydrogen leak was detected in a pipe in a non-nuclear area of the plant but it was small and presented no health risk to employees or the public, according to Edison.

Though Edison is the plant's main operator, San Diego Gas & Electric owns a 20-percent share and receives one-fifth of its power.

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