Thursday, October 3, 2013

Block to state utilities commission: San Onofre closure costs should be paid by operators and shareholders

Block urges repayment to ratepayers of revenue already collected to pay for failed generators

SAN DIEGO—State Senator Marty Block today released the following statement at the San Diego meeting of the California Public Utilities Commission investigative hearing into the outage of the San Onofre Nuclear Generating Station (SONGS):

“Dear Commissioner Florio and members of the California Public Utilities Commission:

“Thank you for conducting this important hearing today in my community of San Diego.

“Radioactive leaks in the steam generators at San Onofre resulted in reported costs of more than $768 million. It is unclear how accurate this estimate is and what unknown future costs will occur as the removal, cleanup and replacement of this energy source are undertaken.

“While the “easy fix” may be to pass these costs on to ratepayers, I strongly urge your opposition to any attempt to convert ratepayers into the ATM for any unreasonable expenses that led to the closure of San Onofre.

“I also urge you to require that Southern California Edison – SCE – provide documentation of costs and act in a transparent manner before increasing utility rates to cover any portion of the costs related to the failed steam generators.

“This is especially critical as Southern California Edison’s decision to prematurely retire the San Onofre Nuclear Generating Station (SONGS) was a choice, made by its internal management, absent any input by any state regulatory authorities.

“These outlays related to the utility’s decision to retire the plant, should rightly be charged to the plant’s operators and their shareholders – not to California ratepayers.

“In addition, Southern California Edison and San Diego Gas & Electric have already collected an estimated $1.6 billion from California ratepayers to defray the San Onofre-related expenditures before any investigation regarding the appropriateness of this revenue collection has been concluded. 

“It would be highly unjust to make California ratepayers financially liable for both the ongoing costs of keeping the plant on life support while also being charged for replacement power while the plant was idle.

“I urge the PUC to rule that:

    1.    Ratepayers not be charged for any of the estimated $768.5 million spent as part of the steam generator replacement project at SONGS;

    2.    SONGS operators should cease to charge ratepayers for ‘operational costs,’ capital costs and other expenditures associated with the non-operational power plant; and

    3.    Ratepayers be reimbursed for revenues collected while SONGS stood idle from January 2012 to the present.

“The Commission has a duty under Public Utilities Code Section 451 to ensure that all utility charges are just and reasonable. The three steps I list are necessary to ensure that consumers are protected from unjust and unreasonable rates associated with the SONGS termination.

“As the Public Utilities own Division of Ratepayer Advocates noted, charging ratepayers for the expenses of a non-operational plant is so clearly unreasonable that failure to eliminate SONGS costs from rates immediately would result in a violation of Section 451.

“I respectfully urge your full consideration of the three steps I have outlined.”

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