A few weeks ago, PG&E
announced that it would not pursue a license renewal for the 2200mw reactors at
Diablo Canyon. This is major landmark
decision, driven by the potential seismic issues at the site, and the need for
huge uneconomical upgrades to continue to run the plants beyond their 2024
expiration. Several major policy points
are highlighted in this decision.
First, nuclear power today is basically uneconomical, and
way more expensive than the alternatives of natural gas, renewables, and
efficiency. This is true for new plant
construction, as well as the continued operation of the aging plants built
30-40 years ago. Diablo has always been contentious…first in its fiasco
construction cost overruns, then in its electricity pricing schemes during the
2000’s deregulation debacle, to its current expensive electricity…even though
it is an old plant whose capital costs have been paid for over the years by
ratepayers. This is happening all over
the US, as we begin to wean ourselves from the large economic, environmental,
and social costs of centralized nuclear and coal power.
Second, the myth of utilities needing huge baseload power to
counter the intermittency of renewables no longer stands. PG&E CEO Tony Earley said “that as the
company looked into California’s energy needs for the coming decades, it didn’t
see a place for Diablo…Our analysis continues to show that instead of
continuing to run all the time, there will parts of the year where Diablo will
not be needed…At a plant like Diablo, with large fixed costs, if you
effectively only run the plant half the time, you’ve doubled the cost.” I have talked before about peak power
demand, and how generating resources are allocated. Early use of solar met some
of the need for “peaker” natural gas plants.
The tremendous deployment of renewables, and their enormous potential
today offers the ability to use the most cost-effective and efficient energy
resource to meet the demand. Recently,
in the Northwest, some wind power producers were paid (due to contracts written
years ago) not to produce power during certain times, because demand was low,
and large baseload power plants could not be turned on or off at will. Renewables can be turned on or off whenever
without serious economic issues because of their technology, and the fact that
the fuel is free. Some say that costly
peakers will only be used in dire circumstances, since batteries can be
recharged and hydrogen produced at will whenever excess electricity is
available anytime of the day.
Third, PG&E acknowledges the dramatic and incredible
changes that are coming to the “grid” and to the utilities themselves. The biggest challenge obviously is the
storage of excess electricity for use when needed. California is actively pursuing and developing various options
with great promise. (I still think
hydrogen/fuel cells will become the most realistic option.) Ironically, back in the ‘80’s the only way
Diablo could fit into California’s electricity system was with storage. At night when the 2000MW of baseload was not
needed, and the plant could not be turned off, the power was used to pump water
uphill to a reservoir where it would be released the next day providing 1000MW
of hydro power when it was needed (the Helms Project.) That water is captured, and pumped back
uphill the next evening. Smaller-scale
storage will allow for more flexibility in the new digital grid system, with various
options being battery storage (commercial large scale as well as small residential,)
pumped storage, mass /gravity systems, compressed air, and a whole lot of
ingenious methods on the drawing boards.
Fourth, the whole electricity market is changing very
rapidly. More and more businesses and
individuals are seeing the benefits of creating their own power, and using
utilities for distribution, or just bypassing them altogether. Google just overtook the US Department of
Defense as the largest single user of electricity, and will soon become the
largest single producer in the US, with more to come. MGM Resorts found it cheaper to generate their own electricity
rather than buying it from the utility, and that Nevada utility just lost its
biggest customer. As prices comes down
due to better manufacturing, increased efficiency, and new financial marketing,
the future looks very bright. Add the
fact that electricity demand is declining due to efficiency in all sectors…thus
PG&E holds confidence that it can meet the challenges of the future for
California. Remember, this is one of the largest utilities in the US, and other
states and utilities will soon follow suit, because they need to evolve and
adapt to the new technological grid and the shift from the old-school business
model of supply and demand.
Fifth, another myth that we need nuclear to meet the
challenge of reducing CO2 emissions no longer holds validity. Even though the actual operation of a
fission reactor does not produce CO2 because it is not burning fossil fuels,
the entire fuel chain from creating the uranium fuel to decommissioning and
waste disposal releases large amounts of all kinds of toxic and greenhouse
emissions. PG&E is confident that
it can meet the demands of the State for its mandate of 50% renewables by 2030
with a subsequent decrease in emissions.
Sixth, PG&E glosses over the huge commitment to the
decommissioning of Diablo, stating that the cost sometime down the road would
be $3.8 billion. I stand and say “Nonsense!” “Big Hoax!” In 1987 when we in Humboldt County fought
PG&E in court on decommissioning costs, they estimated Diablo to cost
$200m. We prevailed with the judge
acknowledging a price tag of $1B.
PG&E was appalled. At the
same time, the Humboldt Bay nuke was estimated at $95m. That escalated to $380m in 2007 before work
began; then to $500m a few years later, to the current estimate of over
$1B. I expect Diablo will cost in
excess of $8B, and the actual work won’t begin in earnest for 20-30 years, with
PG&E spending large sums of monies for SafeStor of the plant and the
safeguarding of the spent fuel waste.
Meanwhile, ratepayers will continue to be charged a “tax” to go into the
fund (currently at $2.8B) to pay all the bills, and future generations for
years to come will continue to meet that debt, as well as the unknown costs of
storing the spent fuel forever. It’s
interesting that EDF in France is starting to drool over the current $200B cost
estimate for decommissioning its reactors...Areva, Bechtel, Babbcock &
Wilcox, Westinghouse, at al are licking their chops for their future profits in
the trillion dollar global bill.
Remember, these monies are non beneficial…no real benefit except for the
jobs and profits…no useful product such as electricity, goods, or other
products. It’s taking out the garbage
after an elaborate meal. Sort of like
the Cold War mentality, where we spent trillions of dollars producing something
(nuclear weapons) we hoped we never would have to use!
The future closure of Diablo Canyon is indeed a battle long
fought and hard won. We are still
trying to get it closed NOW before an earthquake or other incident creates an
economic and environmental catastrophe.
Our dreams are slowly coming true as we always believed, where we can
run parts of our society on clean, sustainable, renewable energy. There are tremendous challenges ahead, both
technical, and mainly political; but over time common sense prevails. We’ll see
what happens in November!
A couple of good reads are:
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