BILL ANALYSIS Ó SB 968 Page 1 SENATE THIRD READING SB 968 (Monning) As Amended August 17, 2016 2/3 vote. Urgency SENATE VOTE: 36-0 ------------------------------------------------------------------ |Committee |Votes|Ayes |Noes | | | | | | | | | | | | | | | | |----------------+-----+----------------------+--------------------| |Utilities & |15-0 |Gatto, Patterson, | | |Commerce | |Burke, Chávez, Dahle, | | | | |Eggman, Cristina | | | | |Garcia, | | | | | | | | | | | | | | |Eduardo Garcia, | | | | |Hadley, | | | | | | | | | | | | | | |Roger Hernández, | | | | |Obernolte, Quirk, | | | | |Santiago, Ting, | | | | |Williams | | | | | | | |----------------+-----+----------------------+--------------------| |Appropriations |15-0 |Gonzalez, Bigelow, | | SB 968 Page 2 | | |Bloom, Bonilla, | | | | |Bonta, Chang, Eggman, | | | | |Eduardo Garcia, | | | | |Jones, Obernolte, | | | | |Quirk, Santiago, | | | | |Weber, Wood, McCarty | | | | | | | | | | | | ------------------------------------------------------------------ SUMMARY: Requires the California Public Utilities Commission (CPUC) to cause an assessment of the economic impacts, for the County of San Luis Obispo and the surrounding regions that could occur if or when the Diablo Canyon Nuclear Powerplant temporarily or permanently shuts down. Specifically, this bill: 1)Requires the CPUC to cause an assessment to be completed by July 1, 2018, of the adverse and beneficial economic impacts, and the net economic effects, for the County of San Luis Obispo and the surrounding regions, that could occur if the Diablo Canyon Units 1 and 2 powerplant were to temporarily or permanently shut down before the power plant's current operating licenses or when it closes upon the expiration of its current licenses. 2)Requires the assessment to include a specified review of potential actions for the state and local jurisdictions to consider in order to mitigate the adverse economic impact of a shutdown. 3)Requires the assessment to be conducted by an independent third party, as specified. SB 968 Page 3 4)Requires the assessment to consist of, but not be limited to, all of the following: a) Estimate of any changes in local tax revenues, changes in workforce populations, changes in indirect or induced economies, and potential impacts to ratepayers from a shutdown; b) A review of the economic impacts that affected the region surrounding the San Onofre Nuclear Generating Station (SONGS) after it was decommissioned by the Southern California Edison Company and of the relevant decommissioning plans of SONGS; c) A review of the regions in the United States similar to the region surrounding the County of San Luis Obispo that have experienced the decommissioning of a nuclear powerplant and of the resulting economic impacts of the decommissioning on those regions; and d) Identification of any contingency plans that could mitigate the adverse economic impact of a shutdown to state and local jurisdictions, the local workforce, and entities receiving enhanced tax revenue. 5)Requires the independent third party to consult with the Board of Supervisors of the County of San Luis Obispo, the governing board of the San Luis Coastal Unified School District, the Center for Labor Research and Education at the University of California, Berkeley, the regional economic development group of the County of San Luis Obispo, and other relevant governmental entities or community-based organizations to assist in an accurate assessment of the economic and workforce impacts of a shutdown. SB 968 Page 4 6)Requires the CPUC to make the assessment publically available on its Internet Web site, distribute copies to relevant state and local jurisdictions, and convene a public forum in the County of San Luis Obispo on the findings and recommendations of the assessment. 7)Appropriates $400,000 from the nuclear decommissioning trust funds to be used for additional staffing to urgently effectuate the specified third-party assessment. 8)Includes an urgency clause allowing the provisions of this bill to take effect immediately upon enactment. FISCAL EFFECT: According to the Assembly Appropriation Committee, this bill appropriates $400,000 to the CPUC to fund the assessment and hire limited-term staff to provide oversight. In addition, the CPUC 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: The Diablo Canyon Powerplant is a two-unit nuclear powerplant operated by the Pacific Gas and Electric Company (PG&E), and is the only remaining operating nuclear powerplant in California. According to PG&E, the powerplant produces approximately 20% of PG&E's overall electricity production and 10% of California's energy load. The powerplant is licensed by the federal Nuclear Regulatory Commission (NRC) to operate until 2024 and 2025, for units 1 and 2. In June 2016, PG&E announced that it would not renew its license for the Diablo Canyon Powerplant. SB 968 Page 5 2)Diablo's Economic Impacts on the Region: According to the author, having unbiased and accurate economic data for local planning and discussion is valuable because the region surrounding the Diablo Canyon Powerplant is heavily reliant on the plant. Arguably, shuttering of Diablo Canyon would have a major impact on the economies of San Luis Obispo and its surrounding regions. The loss of jobs resulting from the closure of Diablo Canyon potentially would have a ripple effect on the business and economic health of the region. This bill requires the CPUC to cause an assessment to be completed by July 1, 2018, of the adverse and beneficial economic impacts, and the net economic effects, for the County of San Luis Obispo and the surrounding regions, that could occur if or when the Diablo Canyon Units 1 and 2 powerplant temporarily or permanently shuts down. In addition, this bill requires the assessment to be conducted by an independent third party, and requires the independent third party to consult with specified entities. Furthermore, this bill also requires the assessment to include a review of potential actions for the state and local jurisdiction to consider in order to mitigate the adverse economic impact of a shut down. This bill appropriates $400,000 from the nuclear decommissioning trust funds to be used for additional staffing to urgently effectuate the specified third-party assessment. Analysis Prepared by: Edmond Cheung / U. & C. / (916) 319-2083 FN: 0004383 SB 968 Page 6