Additional Diablo Canyon Power Plant Proposal
Affirms PG&E’s Commitment to Meet California’s Renewable and
Clean Energy Goals
Reflecting the company’s commitment to address the growing
threat of wildfires, PG&E is proposing a series of important
additional safety investments as part of its 2020 General Rate Case
(GRC) to help further protect the 16 million people it serves.
The company’s GRC proposal, filed today with the California
Public Utilities Commission (CPUC), includes additional
precautionary measures implemented after the 2017 and 2018
wildfires to help further reduce wildfire threats. Such measures
will help bolster wildfire prevention, risk monitoring and
emergency response; add new and enhanced safety measures; increase
vegetation management; and harden PG&E’s electric system to
help further reduce wildfire risk.
2020 General Rate Case
More than half of PG&E’s proposed increase would be directly
related to wildfire prevention, risk reduction, and additional
safety enhancements. Among the important wildfire safety
investments in the GRC proposal are the following components of
PG&E’s expanded Community Wildfire Safety Program:
- Installing stronger and more resilient
poles and covered power lines across 2,000 miles of high fire-risk
areas;
- Increasing ongoing work to keep power
lines clear of branches from an estimated 120 million trees with
the potential to grow or fall into overhead power lines, including
annual vegetation inspection of approximately 81,000 miles of
high-voltage electric distribution lines;
- Implementing SmartMeter™ technology to
more quickly identify and respond to fallen power lines;
- Expanding the network of weather
stations to enhance weather forecasting and modeling by adding
1,300 new weather stations in high fire-risk areas by 2022;
and
- Installing nearly 600 new
high-definition cameras in high fire-threat areas, increasing
coverage across these areas to more than 90 percent.
While the GRC proposal will help fund a series of important
safety investments, this proposal does not request funding for
potential claims resulting from the devastating 2017 and 2018
Northern California wildfires, the largest of which are still under
investigation. The proposal also does not request recovery of
PG&E Corporation or Utility officer compensation.
“We understand and embrace our responsibility to safely provide
electricity and gas to the communities we have the privilege to
serve. As California experiences more frequent and intense
wildfires and other extreme weather events, we must take necessary,
bold and urgent steps to protect our customers. The prudent
investments we are proposing will help build a safer and more
resilient energy system for the future,” said Steve Malnight,
PG&E Senior Vice President of Energy Supply and Policy.
Open and Transparent Public Process
As with any GRC proposal, all investments and expenditures are
subject to open and transparent public review and approval by the
CPUC. The Commission will thoroughly review PG&E’s proposal,
including holding public hearings across the state. PG&E
strongly encourages its customers to provide feedback and
participate in this important public process that will help shape
customer rates and California’s energy future.
Customer Bills
If the CPUC approves the proposed investments, the average
monthly bill for a typical residential electric and gas customer
would increase by $10.57 a month, or 6.4 percent. This includes
$8.73 for electric and $1.84 for gas service. The resulting rate
change would occur in 2020 following the Commission’s decision.
“PG&E recognizes that any increase to a customer’s energy
bill has a significant impact, and we are committed to keeping
customer costs as low as possible, while ensuring we are meeting
our responsibilities to safely serve our customers,” Malnight
added.
2018 Nuclear Decommissioning Cost Triennial
Proceeding
PG&E filed a second and separate proposal today at the CPUC
that is referred to as the 2018 Nuclear Decommissioning Cost
Triennial Proceeding (NDCTP). The filing is consistent with the
CPUC’s decision to retire Diablo Canyon Power Plant (DCPP) in 2025
to meet California's evolving energy policies and increase the use
of renewable energy and energy efficiency resources. The NDCTP
filing proposes an updated cost estimate for the safe
decommissioning of DCPP and to restart the collection of customer
contributions that are necessary to fund the project.
“Diablo Canyon continues to be an important resource for
California in achieving our clean energy goals. When the plant has
completed its service at the end of the operating licenses, we are
committed to safely decommissioning Diablo Canyon in a fashion that
is consistent not only with all laws and regulations, but also
recognizes its important location to the community and California.
We will remain firmly focused on working with the state, local
leaders and our neighbors to determine the most appropriate path
forward concerning the surrounding lands and coastline,” said
Malnight. “This proposal will ensure we have the proper funding to
achieve these important environmental and community goals.”
Process to Close Diablo Canyon
Following the 2016 announcement to retire DCPP in 2025, PG&E
completed a comprehensive, site-specific DCPP decommissioning
analysis. The study informed PG&E’s updated project cost
estimate of $4.8 billion and proposal to re-start the collection of
customer contributions into a separate trust established to finance
the decommissioning project, safely store used fuel until the
federal government takes storage responsibility and to remove all
supporting campus infrastructure such as office buildings,
warehouses and the site’s marina.
Currently, PG&E has approximately $3.2 billion set aside in
the decommissioning trust for the project and needs an additional
$1.6 billion in 2017 dollars to fully fund the safe decommissioning
of DCPP.
In the NDCTP filing, PG&E is requesting that customer
contributions for decommissioning restart in 2020 and conclude at
the end of 2025. This will ensure that only those customers who
benefit from the clean, reliable and affordable energy produced by
DCPP will be responsible for supporting its decommissioning. It
will also ensure compliance with California and federal laws
requiring the reasonable costs of decommissioning be funded prior
to the closure of a nuclear power plant.
The decommissioning cost estimate could potentially decrease in
the future if existing campus infrastructure, such as the site’s
marina, is repurposed for alternative uses. Decisions on future
repurposing will be made by PG&E with the input of the Diablo
Canyon Decommissioning Engagement Panel and the local community,
and are subject to regulatory approval.
Customer Bills
Approval of the 2018 NDCTP would result in a short-term monthly
bill increase for a period of six years. For an average non-CARE
bundled residential electric customer in 2020, the bill impact is
about 2 percent, or $1.98.
Open and Transparent Public Process
The NDCTP filing, as with the 2020 GRC proposal, are subject to
open and transparent public review and approval by the CPUC. The
Commission will perform a thorough review of PG&E’s proposals,
which will include public hearings across the state. PG&E
strongly supports and encourages its customers to provide feedback
and participate in this important public process which will help
shape customer rates and California’s energy future.
Cautionary Statement Concerning Forward-looking
Statements
This news release includes forward-looking statements that are
not historical facts, including statements about the beliefs,
expectations, estimates, future plans and strategies of Pacific Gas
and Electric Company (PG&E). These statements are based on
current expectations and assumptions, which management believes are
reasonable, and on information currently available to management,
but are necessarily subject to various risks and uncertainties. In
addition to the risk that these assumptions prove to be inaccurate,
factors that could cause actual results to differ materially from
those contemplated by the forward-looking statements include the
timing and outcome of the remaining investigations into the 2017
and 2018 Northern California wildfires, weakened credit conditions
that may impair PG&E Corporation’s and PG&E’s ability to
access the capital markets, and other factors disclosed in PG&E
Corporation and PG&E’s annual report on Form 10-K for the year
ended December 31, 2017, their most recent quarterly report on Form
10-Q for the quarter ended September 30, 2018, and their subsequent
reports filed with the Securities and Exchange Commission. PG&E
Corporation and PG&E undertake no obligation to publicly update
or revise any forward-looking statements, whether due to new
information, future events or otherwise.
About PG&E
Pacific Gas and Electric Company, a subsidiary of PG&E
Corporation (NYSE:PCG), is one of the largest combined natural gas
and electric energy companies in the United States. Based in San
Francisco, with more than 20,000 employees, the company delivers
some of the nation’s cleanest energy to nearly 16 million people in
Northern and Central California. For more information, visit
www.pge.com/ and pge.com/news.
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