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Southern California announced this morning that it is shutting down the troubled San Onofre nuclear power plant, according to a story in the Los Angeles Times. The move comes 17 months after the plant was closed because of steam generator problems. The plant is mostly owned by Edison, but San Diego Gas & Electric (SDG&E) owns 20% of it. It has been serving about 1.4 million Southern California households, including many in San Diego County.

"We have concluded hat the continuing uncertainty about when or if [the plant] might return to service was not good for our customers, our investors, or the need to plan for the region's long-term electricity needs," said Ted Craver, chairman and chief executive of Edison International, parent of Southern California Edison, according to the Times. Edison and SDG&E spent more than $780 million replacing the steam generators several years. Ratepayers have been hit with these charges, and that has led to a number of bitter complaints over whether ratepayers should be responsible for paying for management mistakes.

I am getting the Edison statement shortly and will have more responses. Best, Don Bauder

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Comments

Don Bauder June 7, 2013 @ 8:50 a.m.

ADDITIONAL MATERIAL ON SAN ONOFRE'S CLOSING. The first unit went into service in 1968; units 2 and 3 went into service in 1983-1984. Unit 1 was closed in 1992. The other two have been closed down since early 2012, but utility officials had been pressing for a reopening. Michael Peevey, head of the California Public Utilities Commission (CPUC), and a former president of Edison, commented, "The challenge now facing Southern California's electric system and economy is what comes next." Southern California ratepayers wonder who will pick up the tab for the decommissioning, and for additional facilities. They fear that, under Peevey, the ratepayers will pick up too much of the expense, and the shareholders too little. Craver recently told Wall Street analysts, "there is a practical limit to how much we can absorb of that risk." Translation: we will try to pass the costs to ratepayers.

There will be substantial layoffs at the plant. Organized labor has been pressuring to keep the two units open.

Ron Litzinger, president of Southern California Edison, said "The company is already well into a summer reliability program and has completed numerous transmission upgrades in addition to those completed last year. Thanks to consumer conservation, energy efficiency programs and a moderate summer, the region was able to get through last summer without electricity shortages. We hope for the same positive result again this year, although generation outages, soaring temperatures or wildfires impacting transmission lines could test the system."

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aardvark June 7, 2013 @ 8:53 a.m.

Get ready for the other shoe to drop--the rate hikes to dismantle the facility.

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Don Bauder June 7, 2013 @ 9:10 a.m.

aardvark: Yes, this is the next battle: keeping Edison, SDG&E and CPUC from conspiring to shift costs to ratepayers and not to shareholders. Best, Don Bauder

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Visduh June 7, 2013 @ 9:08 a.m.

If this is for real, and not just a bluff by Edison to try to force the NRC to grant them the approval to restart at reduced power, I'll be surprised. In fact, it all comes off as a childish "cut off my nose to spite my face" ploy. I doubt that anything very emotional went into this decision. The NRC and/or CPUC could beg reconsideration, and Edison could "reluctantly" agree.

What we can be sure is that the owners will expect the CPUC to allow them to pass along every cent of the overhaul, including the cost of the defective generators. They will also expect the collect the full cost of keeping the plant open for the past 17 months AND the cost of purchasing replacement power. That would, of course, be tantamount to paying for SONGS as if it had been up and running all that time when in fact, no electricity was generated. Then we can look forward to the owners wanting the ratepayers to pay for many decades of decommissioning--and it will take decades to do it. The owners will attempt to shield the shareholders from taking any of the hit for this fiasco, hoping to be allowed to jack up the rates to pay for the whole thing.

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Don Bauder June 7, 2013 @ 9:15 a.m.

Visduh: From my initial reading of statements, I am not sure that this is a ploy. But your point is well taken. Yes, as I have said repeatedly here, the CPUC will do its best to protect shareholders. It will be interesting to see what happens to Edison stock today. If you will recall, after SDG&E was supposedly denied the ability to pass uninsured fire costs to ratepayers, Sempra stock rolled right along upward. Wall Street expected a quiet reversal of that decision -- which is still expected by skeptical CPUC watchers.Best, Don Bauder

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Don Bauder June 7, 2013 @ 9:26 a.m.

GIVE CREDIT TO ATOMIC SAFETY AND LICENSING BOARD AS WELL AS FRIENDS OF THE EARTH. Peter Dietrich, Edison's boss of San Onofre, sent a plaintive note to San Onofre employees today. "The tough reality is that the recent Atomic Safety and Licensing Board decision creates significant additional uncertainty regarding our ability to get a [Nuclear Regulatory Commission] decision to restart Unit 2 this year." The company will be reducing staff of 1500 to 400. The Atomic Safety and Licensing Board recently ordered a rehearing on the reopening of Unit 2 at 70% power.

Ace Hoffman of Carlsbad stated, "[Friends of the Earth] deserves enormous credit for their role in this event. Southern California narrowly avoided its own Fukushima on January 12th, 2012. Friends of the Earth hired Arnie Gundersen, an expert in steam generator technology, and then hired other experts. They determined that San Onofre's tubes were beyond repair. Engineer Ron Leichtling was front and center fighting the reopening, as was San Diego attorney Mike Aguirre, among many others.

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Don Bauder June 7, 2013 @ 9:49 a.m.

EDISON STOCK UP 1.81% IN INITIAL TRADING. Stock of Edison International, parent of Southern California Edison, has soared 1.81% to $47.20 this morning. The overall market is up sharply (the Dow is up 1.03%, but well off its highs), the upride of Edison stock suggests Wall Street is convinced that costs of the San Onofre shutdown and construction of new facilities will be greatly passed on to ratepayers, and not stockholders. Best, Don Bauder

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Founder June 7, 2013 @ 12:25 p.m.

Ratepayers want low cost, SAFE energy and Solar is now ready to provide it.

There are only three things standing in the way of FIXING our energy problem:

Our powerful Utilities, who want to keep us in Energy Slavery, so that we will be forced to purchase our energy from them instead of producing it ourselves for FREE (after the initial payback).

Our appointed regulators, who have a too cozy relationship with the very Utilities they regulate! They have been putting Utility shareholder profits ahead of following their sworn mandate and demanding that our "public" utilities provide energy to US at the lowest cost possible! Example: Why should Utilities be allowed to rip off residential solar panel owners by not reimburse them for the energy they add to the grid at the very same rate that the Utility pays itself when it adds energy to the grid? This would "level" the energy playing field and greatly reduce the payback periods of owning your own panels, which would make installing solar even a better deal!

Our Political Leaders are beholden to the Powerful Utilities because of large Utility donations and have been until recently hesitant to propose changes to "how the energy game is played" but now with a shrinking economy, the public resistance to ever higher energy costs and record Utility shareholder profits, energy is becoming a HOT political issue that Political Leaders cannot ignore any longer, if they want to stay in office or get elected.

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Don Bauder June 7, 2013 @ 12:39 p.m.

Founder: All your points are excellent. There is no question that the CPUC under Peevey has been far more concerned about the performance of utility stocks than about reasonable-cost service provided to consumers, the regulator's mandate. This morning, Edison stock is now up 2.14%, more than double the rise of around 1% of the Dow Jones Industrial Average. This strongly suggests Wall Street feels that shareholders won't get nicked by the big expenses and writeoffs.

Ron Leichtling raises a couple of more interesting points. 1. What happens to real estate values in the immediately affected areas? Leichtling thinks they will go up because of no more fear of a nuclear meltdown. On the other hand, one can argue that values will flatten or go down, because the cost of this is going to be shifted to ratepayers, as Wall Street clearly feels. 2. Will the CPUC enable consumers to install rooftop solar at reasonable rates? If it would do so, that would be a tremendous boon to ratepayers, and probably to real estate values. The CPUC needs to say that if a consumer with solar generates energy that goes on the grid, it should get as much money as utilities do for doing so. The chance of this happening is quite remote, however. But overall, there is no question that rooftop solar is the answer in Southern California, but the CPUC thus far, influenced by greedy utilities, has not let it happen. Best, Don Bauder

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Anon92107 June 7, 2013 @ 1:05 p.m.

Don, this ought to keep you and the READER busy for many years protecting San Diego ratepayers from SDG&E, SCE, CPUC and whatever is left of UCAN.

Peevey must first be fired immediately by Brown for his part in creating the SONGS disaster as former SCE President, and then making the disaster increasingly worse as CPUC President.

If Peevey isn't fired, then ratepayers shall get the worst screwing in utility history and Brown should be fired also.

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Don Bauder June 7, 2013 @ 1:12 p.m.

Anon92107: If Brown hasn't fired Peevey by now, he is not likely to do so. Today's San Onofre decision may reflect pressure on Peevey from Brown's office. Best, Don Bauder

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Anon92107 June 7, 2013 @ 1:54 p.m.

Don, as you must know, "pressure on Peevey from Brown's office" is a farce, and a cover-up for Brown if that outrageous statement is true.

The fact is that Peevey should have acted long before now when the steam generator tubes carrying radioactive water were suspected of being an unsafe design and construction by some of the engineers. The fact that is now known without a doubt is that SONGS was an unacceptable threat to public safety due to SCE corruption, negligence and incompetence during design, manufacture, construction and operation, threats that the CPUC/Peevey participated in creating.

It must not be overlooked that another long-term tragedy is that we needed nuclear power to have any chance at all in eliminating CO2 producing power plants that are unacceptably accelerating climate changes already. But Fukushima already hammered many nails into the coffin of nuclear power, and then SCE/CPUC proved they were just as corrupt and criminally negligent about public safety as their Japanese counterparts.

Greed wins again, and the long-term future of humanity is increasingly, unacceptably threatened. Current adult generations have failed again to protect the future for our grandchildren and future generations.

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Don Bauder June 7, 2013 @ 3:19 p.m.

Anon92107: Prior to today's decision, several knowledgeable people spoke in Orange and San Diego counties about how the Fukushima disaster could be a precursor to what could happen at San Onofre. I don't know if that influenced the decision. Best, Don Bauder

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Founder June 8, 2013 @ 4:58 p.m.

Now southern California has yet another reason to install more rooftop solar, that way we can get more free Energy from the sun (after payback) and while also eliminating the need for RISKY nuclear...

If SCE, SDG&E and the CPUC will not enable us to do that then they are guilty of using their status as a public Utility to act more like a Public Monopoly, which worries more about its shareholders than they do the ratepayers!

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Don Bauder June 9, 2013 @ 7:40 p.m.

Founder: Correct. The publicly-held California utilities -- Sempra, SCE, PG&E -- are holding back expansion of rooftop solar, which is needed more than ever now. Best, Don Bauder

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Don Bauder June 7, 2013 @ 5:39 p.m.

EDISON INTERNATIONAL UP 2.7% ON THE DAY. Stock of Edison International, 80% owner of the San Onofre plant that is closing down, ended up the day up 2.7% on double normal volume. Management had a call this morning with analysts to reassure Wall Street. The sharp rise suggests several factors: 1. Wall Street believes that ratepayers, and not shareholders, will get stuck with the largest costs of closing down the plant; 2. Wall Street loves the stock price-obsessed orientation of the California Public Utilities Commission; 3. Uncertainty has possibly been lifted. Best, Don Bauder

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Visduh June 8, 2013 @ 8:55 a.m.

Wall Street can often react in the exact opposite way that a "rational" person would expect. WS has its own logic, and when there are multiple factors in play, the one that wins out if often not the one that you would expect, Back about 40 years ago, when the wretched, ham-handed Nixon economic controls were being unwound, whenever some relaxation was proposed or implemented, the market would take a dip. A dip? Yep, a dip. And why was that? The pundits said it was a reaction to the instability and uncertainty that the relaxation would being. In other words, the markets seemed happier with the devil they knew than with a freer economy. In this case, your third point may be the one that wins out. But to me, all this does is trade the uncertainty of the plant's eventual restart for the uncertainty of how well Edison will be able to get regulators to allow a pass-through of the costs. I don't think that it is a foregone conclusion that the CPUC will pursue the present policies forever. Things change and will change, even at the CPUC.

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Don Bauder June 9, 2013 @ 9:58 a.m.

Visduh: I agree that it is usually fatuous to try and judge a one-day move in the market. But in this case, Edison's big upride seemed newsworthy. Yes, it may be the uncertainty being lifted -- (possibly lifted). But right along, the stocks of Sempra and Edison have moved well in the teeth of possibly expensive events. Wall Street loves California regulators -- no doubt about that. Best, Don Bauder

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Anon92107 June 8, 2013 @ 3:10 a.m.

“Who should pay for San Onofre fiasco? The answer is obvious”

By Michael Hiltzik LATIMES June 7, 2013

http://www.latimes.com/business/la-fi-hiltzik-20130608,0,1949781.column?track=rss

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Don Bauder June 8, 2013 @ 7:15 a.m.

Anon92107: This LA Times column is superb, and should be read by everyone. Just keep in mind that the head of the California Public Utilities Commission (CPUC), Mike Peevey, is a former president of Southern California Edison and its parent, Edison International. In the late 1980s and early 1990s, Edison attempted to take over San Diego Gas & Electric. Peevey was in charge of that takeover attempt. He failed ignominiously. Best, Don Bauder

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Don Bauder June 9, 2013 @ 9:51 a.m.

Founder: The U-T was all for permitting San Onofre to be reopened. Then Edison pulled the rug out from under the paper, which it had wooed. Then the U-T write a pathetic editorial trying to walk the tightrope. Best, Don Bauder

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Visduh June 9, 2013 @ 8:25 p.m.

So many recent editorials in the Mill have so been pathetic that one would wonder why anyone reads them. I've still not gone back to the Saturday edition to read whatever it was. Dougie has his Light(weight) editor churning out such a really pathetic attempt of running a major city daily newspaper that it is amusing. What is NOT amusing it the stark fact that all the major dailies are in much the same fix with too few readers, too few subscribers, too few advertisers, and too few reporters.

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Don Bauder June 10, 2013 @ 7:03 a.m.

Visduh: Too true. Metro dailies have been hit the hardest. Some rural weeklies and semi-dailies are doing fine. Best, Don Bauder

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Founder June 10, 2013 @ 10:45 a.m.

Agreed, but I enjoyed the cover image, especially from the UT

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Don Bauder June 10, 2013 @ 11:56 a.m.

Founder: Are you talking about the front page art following the announcement of San Onofre's closing? Best, Don Bauder

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Founder June 10, 2013 @ 10:46 a.m.

From the web:

I'm counting on the NRC to complete all its investigations into what was going on at San Onofre and especially how SCE was able to build their 465 million dollar RSG without going through a CFR 50.59 process, which includes public hearings.

Sweeping all the investigations "under the rug" will be a dis-service to both those that reported what was happening at San Onofre and to the NRC's role as a regulator to the nuclear industry!

The NRC should be issuing fines and or other types of enforcement as well a re-thinking one of its core beliefs that only one SG tube can ever fail at any one time which San Onofre proved could happen!

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Don Bauder June 10, 2013 @ 11:59 a.m.

Founder: Unfortunately, sweeping the most important utility-related questions under the rug is the MO of the utilities, the CPUC, and other regulators such as the NRC. Best, Don Bauder

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Anon92107 June 10, 2013 @ 1:44 p.m.

Don, what you are saying is there is no champion for ratepayers in San Diego, and California, who can protect us from criminal acts by SCE (San Onofre), SDG&E (firestorms), PG&E (gas pipeline deaths) and CPUC/Peevey (all of the above) that have already caused public safety disasters.

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Don Bauder June 10, 2013 @ 2:01 p.m.

Anon92107: Utility Consumers' Action Network (UCAN) has basically destroyed itself by trying to cover up wrongdoing pointed out by whistleblowers. A suit recently filed by UCAN shows that the whistleblowers were right. However, both have left the organization, complaining that the coverup has continued. But there are other groups, such as the Environmental Health Coalition. And I would hope that another organization could step forward and do what UCAN should have been doing. Best, Don Bauder

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Visduh June 10, 2013 @ 3:06 p.m.

How about TURN? That I think stands for Toward Utility Rate Normalization. Isn't that a statewide operation?

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Don Bauder June 10, 2013 @ 4:29 p.m.

Visduh: TURN is based in San Francisco. At one point, when UCAN was in deep trouble, it tried to merge with TURN. TURN, after finding out the truth, would have nothing to so with it. TURN is definitely a possibility in San Diego. Best, Don Bauder

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