Mod: If you ever look at all of the mishmash of costly numbers located at the upper right hand corner of your Edison electric bill, you will notice something there called "nuclear decommissioning charges." This is the cash that gets taken from you to pay for the Edison's catastrophic failures at the San Onofre nuclear power plant. A radioactive mess that will somehow have to be contained for a few centuries. Talk about a gift to future generations. To add insult to injury, according to the Los Angeles Times today, those decommissioning charges that you are so generously paying for might not have been assigned to you in the most aboveboard kind of way. And yes, I am sure you are surprised to hear this.
A tainted settlement on San Onofre closing costs
After the San Onofre nuclear plant shut down unexpectedly in early 2012, regulators approved a deal dividing up the $4.7 billion in closing costs.
The terms of the settlement were worked out by Southern California Edison, which owns 78% of the plant, in negotiation with San Diego Gas & Electric, consumer advocates and environmentalists. They decided that ratepayers would be responsible for most of the bill — $3.3 billion, minus various credits — while the two utilities’ shareholders would pay the rest.
That apparently seemed reasonable to most of the parties at the time, although consumer groups initially wanted investors to pay more of the costs and some smaller stakeholder groups did not agree to the final deal. But the agreement avoided a protracted litigation process that consumer advocates worried could result in a worse outcome for ratepayers if it was influenced by then-PUC President Michael Peevey, a former chief of Edison, who some suspected was not on the side of customers.
That deal seems a lot less reasonable now, in light of troubling information that has emerged since about secret meetings to discuss how costs should be allocated between Peevey and Stephen Pickett, who was then Edison’s executive vice president for external relations. The meetings were held during the year before the deal was made.
Consumer advocates say they might have rejected the settlement terms and pushed harder for utility shareholders to cover more of the cost of decommissioning if they knew at the time about the meetings, which they say gave an unfair negotiating advantage to Edison at the expense of ratepayers. The PUC in May agreed to reopen the settlement and consider whether it ought to be changed.
The secret meetings occurred in March 2013, after the replacement steam generators failed, forcing the plant to close — but before Edison had decided to shut down the plan for good. Peevey and Pickett were both at an energy industry conference in Warsaw at the time. The notes from that meeting, on hotel stationery, appear to lay out possible ways to allocate the costs associated with shutting down the nuclear plant.
Mod: You can read the rest here.