CPUC considering modifications to San Onofre nuclear deal

In a ruling made just before the close of business hours Tuesday, the California Public Utilities Commission (CPUC) directed Southern California Edison and San Diego Gas & Electric to meet with groups critical of a 2014 agreement that calls on utility ratepayers to shoulder about 70 percent of the costs from shutting down the San Onofre Nuclear Generating Station.

The directive orders the two utilities to “carefully consider” any modifications that would allow greater relief for ratepayers.

“The CPUC must ensure the integrity of its processes and that its decisions serve the public interest,” said CPUC commissioner Catherine J.K. Sandoval in a statement.

The ruling orders SDG&E and Southern California Edison to meet with representatives of the Office for Ratepayers Advocates and The Utility Reform Network, who have urged modifications to the $4.7 billion settlement from two years ago.

The CPUC directive also calls on Edison and SDG&E to consider an assessment of the agreement by the Alliance for Nuclear Responsibility, a San Luis Obispo-based activist group opposed to nuclear power.

Southern California Edison is the majority owner of the plant and oversees its operations. San Diego Gas & Electric, a subsidiary of Sempra Energy, owns 20 percent.

“We have just received notification of the ruling and have not yet had a chance to review it to provide further comment,” SDG&E communications director Christy Ihrig said in an email to the Union-Tribune.

In a statement released late Tuesday night, Southern California Edison defended the 2014 agreement and said it was “disappointed” in the ruling but said it will follow its directives.

“The settlement of the San Onofre nuclear plant shutdown protects customer interests by requiring investors to pay for the replacement steam generators that prompted the closure of San Onofre in June 2013 from the point that they failed,” the statement said.

“SCE has provided or will provide refunds and rate reductions of almost $1.6 billion under the settlement, and this amount may be increased by recoveries from Mitsubishi Heavy Industries, the supplier of the defective steam generators.”

The statement went on to say the original settlement reduced the amount residential customers pay in their monthly bill for past investments to build and maintain SONGS.

The CPUC signed off on a settlement in 2014 but following disclosures published in the Union-Tribune of a secret “ex parte” meeting in Warsaw, Poland, between an Edison executive and then-CPUC President Michael Peevey, Sandoval and an administrative law judge in May of this year decided to give the agreement another look.

Tuesday’s announcement takes the review process a step further.

The Utility Reform Network wanted the dispute settled through litigation but staff attorney Matt Freedman said Tuesday night in an email, “We are pleased the commission now acknowledges that Edison’s backroom contacts with former President Peevey tainted the settlement process and biased the negotiations in favor of utility shareholders.”

The ruling sets out a timetable for meetings between the utilities and the groups wanting changes in the settlement. A deadline of April 28, 2017, has been set to reach some sort of agreement.

If an agreement is not reached by April 28, the CPUC will look at summaries from each parties and proceed from there.

SONGS has not produced electricity since January 2012 after a steam generator tube leak, and the facility is well into the third year of a 20-year decommissioning process.