BILL ANALYSIS Ó
SB 968
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Date of Hearing: August 3, 2016
ASSEMBLY COMMITTEE ON APPROPRIATIONS
Lorena Gonzalez, Chair
SB 968
(Monning) - As Amended August 1, 2016
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|Policy |Utilities and Commerce |Vote:|15 - 0 |
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Urgency: No State Mandated Local Program: NoReimbursable: No
SUMMARY:
This bill requires the California Public Utilities Commission
(PUC) to contract with an independent third party to perform an
economic assessment on the regional impacts that could occur if
the Diablo Canyon Units 1 and 2 nuclear powerplant were to
temporarily shut down prior to the expiration of its license or
when PGE closes the power plant.
Additionally, this bill appropriates $400,000 from the PUC
Utilities Reimbursement Account to the PUC to fund additional
staffing and the third party assessment.
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FISCAL EFFECT:
Appropriates $400,000 to the PUC to fund the assessment and hire
limited-term staff to provide oversight (Utilities Reimbursement
Fund).
The PUC estimates it will require $250,000 to contract with an
independent third party to perform the assessment and an
additional $170,000 to provide oversight.
COMMENTS:
1)Background. PG&E's Diablo Canyon is the
only operating nuclear powerplant in California. According to
PG&E, the plant produces approximately 10% of California's
energy load and about 20% of PG&E's overall electricity.
Diablo Canyon is licensed by the federal Nuclear Regulatory
Commission (NRC) to operate
until 2024 and 2025, respectively for units 1 and 2
In addition to the application with NRC, Diablo Canyon's
continued operation is subject to state permitting and
regulation. Diablo Canyon sits on state tidelands and
operates pursuant to leases issued by the State Lands
Commission (SLC). These leases will expire in 2018 and 2019,
respectively for units 1 and 2. The SLC has not indicated
whether it will renew the leases. The PUC must also approve
ratepayer funding to pay for Diablo Canyon's operations.
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According to San Luis Obispo County, PG&E is both the largest
taxpayer and largest private employer in the county. Diablo
Canyon itself generates millions of dollars in property tax
revenue, which mainly benefits local schools. A June 2013
Economic Impact Study, funded by PG&E, concluded that the
local economic impact of Diablo Canyon is substantial, with
the total 2011 estimated economic impact to be approximately
$920 million. The powerpant has approximately 1,483 employees
and it is estimated that this year the San Luis Coastal
Unified School District will receive more than $10 million
(12% of its operating revenue) from taxes paid by PG&E.
2)Purpose. On June 21, 2016, PG&E announced it will not renew
its license for the two nuclear units at Diablo Canyon but it
will continue paying property taxes through 2025, as well as
enact workforce retention and retraining programs.
According to the author, because Diablo Canyon will not
operate past its current license, this bill is needed due to
the region's economic reliance on the powerplant. The author
further contends, that it is critical for state regulators and
the public to be informed about potential economic impacts
when the plant is no longer in operation and how to best
mitigate negative impacts before the closure.
Analysis Prepared by:Jennifer Galehouse / APPR. / (916)
319-2081
SB 968
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