Dive Brief:
- California customers will see $1.45 billion in refunds and credits under a settlement related to the premature closing of the San Onofre Nuclear Generating Station, KPBS reports.
- The California Public Utilities Commission determined customers would pay about $3.3 billion over 10 years related to the costs of shuttering the plant, though regulators said there is the potential for customer recovery of costs from Mitsubishi and nuclear insurance.
- Under the settlement, consumers pay for some costs including power the utilities purchased for customers after the outage and undepreciated net investment in San Onofre assets, excluding the failed Steam Generator Replacement Project.
Dive Insight:
Regulators noted that rather than the usual authorized rate of return,the settlement reduces shareholder return on San Onofre investments to less than 3%, saving consumers approximately $420 million over the decade-long depreciation period.
“This settlement was proposed by certain parties, including consumer groups, at a time that the record of the proceeding was sufficiently developed and the CPUC could examine the reasonableness and prudency of the proposal,” said CPUC Commissioner Mike Florio. “The CPUC determined today that the settlement is reasonable in light of the whole record, consistent with law, and in the public interest.”
The decision approves a settlement between the Coalition of California Utility Employees, Friends of the Earth, Office of Ratepayer Advocates, San Diego Gas & Electric, Southern California Edison, and The Utility Reform Network. The original settlement agreement was changed to require that SCE and SDG&E each equally share net litigation proceeds from Mitsubishi Heavy Industries between their respective customers and shareholders, and to improve CPUC oversight of utility implementation of the settlement.
