Shares in Edison International, the parent company of San Onofre Nuclear Generating Station operator Southern California Edison, have hit new year-long highs daily since last Friday (March 21), and stock analysts are predicting that Edison will continue to climb in coming days.
The reason for optimism is a meeting with state regulators, scheduled for March 27, in which officials from Edison and minority plant owner San Diego Gas & Electric will meet with the California Public Utilities Commission to discuss who will take responsibility for losses related to the plant's demise, which are expected to top $3 billion.
The utility has long argued that ratepayers, and not Edison shareholders, should bear the burden for the plant's failure, picking up the tab for both early decommissioning (the reactors were expected to operate until at least 2022) as well as costs incurred as a result of the shutdown, such as the purchase of replacement power and a series of lengthy investigations and inspections. Speculation has long existed that California Public Utilities Commission president Michael Peevey, former president of Southern California Edison, leads a board sympathetic to industry concerns.
"We note that [Edison] operates in a supportive regulatory environment of California," notes Zacks Equity Research in a March 24 post. "An amicable settlement of costs and liabilities will lift a major overhang on the stock."
Meanwhile, the first meeting of a citizens panel assembled by Edison to report progress on the decommissioning was held Tuesday night. A major concern expressed by nuclear activists going into the meeting was ongoing storage of nuclear waste at the coastal site. According to a study commissioned by Friends of the Earth, the spent fuel currently being stored on site contains radiation equivalent to 89 times what was released in the 1986 Chernobyl disaster.