BILL ANALYSIS
AB 42
Page 1
Date of Hearing: April 13, 2009
ASSEMBLY COMMITTEE ON NATURAL RESOURCES
Nancy Skinner, Chair
AB 42 (Blakeslee) - As Amended: March 31, 2009
SUBJECT : Diablo Canyon Nuclear Power Plant and seismic safety.
SUMMARY : Requires Pacific Gas and Electric Company (PG&E) to
seek funding for seismic fault surveys and retrofits at the
Diablo Canyon Nuclear Power Plant (Diablo Canyon) consistent
with the recommendations of the California Energy Commission
(CEC) in order to maintain grid reliability and reduce cost
impacts to ratepayers resulting from a seismic event.
EXISTING LAW :
1)Requires the CEC to adopt an integrated energy policy report
(IEPR) every two years that includes an overview of major
energy trends and issues, including: supply, demand, pricing,
reliability, efficiency, impacts on public health and safety,
the economy, resources, and the environment.
2)Required the CEC, by November 1, 2008, to include in the IEPR
and any updates an electricity supply forecast that includes:
a) A compilation and assessment of existing scientific
studies to determine the potential vulnerability to a major
disruption due to aging or a major seismic event of large
baseload generation facilities 1,700 megawatts or greater
and;
b) An analysis of the impact of a major disruption on
system reliability, public safety, and the economy.
THIS BILL :
1)Requires PG&E to seek funding for seismic fault studies and
retrofits, deemed urgent by the CEC or the Seismic Safety
Commission (SSC), in the vicinity of the Diablo Canyon
consistent with the recommendations of the CEC in order to
maintain grid reliability and reduce costs to ratepayers due
to a seismic event.
2)Requires the CEC to conduct a peer review of the above studies
and authorizes it to enter into agreement with qualified
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academic and industry scientists to conduct the peer review.
3)Requires the CEC to include the findings and recommendations
of the peer review in the integrated energy policy report.
4)Requires the Public Utilities Commission (PUC) to allow PG&E
to fully recover the costs of the seismic fault studies and
seismic retrofits from all of its electrical customers.
FISCAL EFFECT : Unknown
COMMENTS : On November 21, 2008, PG&E announced that they had
discovered a new earthquake fault within a mile offshore of
Diablo Canyon. According to the author's office, the nature of
the fault is unknown, as is its relationship with the Hosgri
fault, located about three miles offshore of Diablo Canyon. The
discovery of the second fault raises new questions about the
seismic risks of Diablo Canyon; in particular the plant's
vulnerability to a major disruption in electricity generation
due to an earthquake, which could impact the reliability of the
state's energy supply and greatly increase costs to ratepayers.
The author believes that as PG&E explores the feasibility of
relicensing Diablo Canyon, it is imperative that both PG&E and
the state understand the economic and reliability risks of the
plant's extended operation.
1)Background
The state is preempted by the federal Nuclear Regulatory
Commission (NRC) in regulating all aspects of the radiological
safety of nuclear power. However, the state has much broader
authority to set electricity generation priorities based on
economic, reliability, and environmental concerns. The CPUC
relied on this authority in establishing a framework for
considering the cost- effectiveness of renewing PG&E's NRC
license for Diablo Canyon after it sought approval for $16.8
million in ratepayer fund for a license renewal feasibility
study (see below for more discussion).
Similarly, the Legislature relied on the above authority in
passing AB 1632 (Blakeslee), Chapter 722, Statutes of 2006,
which required the CEC to evaluate existing literature on the
potential vulnerability of Diablo Canyon and the San Onofre
Nuclear Generating Station (SONGS) to a major disruption due to
aging or a major seismic event and the impact of this disruption
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on system reliability, public safety, and the economy.
According to the CEC, an earthquake at Diablo Canyon or SONGS
could result in a shutdown of plant operations from as little as
a week to longer periods depending on the extent and location of
any damage. Because these plants contribute a significant
portion of the state's electricity supply (12 percent), a
long-term plan is critical to prevent or significantly reduce
the risk of a major disruption and to be prepared should one
occur.
With respect to Diablo Canyon, the CEC found, among other
things, that:
(a) A sufficient safety margin exists in the plant design to
accommodate ground motion from the Hosgri Fault, even
though this motion was greater than had been anticipated
when the plant was designed;
(b) The deep geometry of faults directly underlying Diablo
Canyon is not sufficiently understood to rule out a 6.5
magnitude earthquake directly beneath the plant similar to
the one that occurred in 2003 in San Simeon. It is
necessary to better define the deep geometry of bounding
faults and to better understand the lateral continuity of
these fault zones. Although these fault zones are unlikely
to replace the Hosgri Fault as the dominant source of
seismic hazard at the plant, improved characterizations of
these fault zones would refine estimates of the ground
motion that is likely to occur at different frequencies.
This information may be significant for engineering
vulnerability assessments.
(c) In addition to PG&E's Long-Term Seismic Study Program,
further study using advanced technology may help resolve
remaining uncertainties. For example, high quality
three-dimensional geophysical seismic reflection mapping
could resolve questions about the characterization of the
Hosgri Fault and might change estimates of the seismic
hazard at the plant (CEC recommendation). Similarly,
direct imaging of the subsurface structure could determine
if faults exist near the site that do not break to the
surface and could also serve to refine knowledge of the
deep geometry, continuity, and interaction of poorly
expressed faults.
(d) PG&E should assess the implications of a San Simeon-type
earthquake beneath Diablo Canyon. This assessment should
include expected ground motions and vulnerability
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assessments for safety and non safety-related plant systems
and components that might be sensitive to long-period
motions in the near field of an earthquake rupture (CEC
recommendation).
(e) Evaluate the seismic vulnerability and reliability
implications for the nuclear plants' non-safety related
systems, structures, and components from changes to seismic
design standards that have occurred since the plants were
designed and built. Such an analysis should consider the
International Atomic Energy Agency Standards and Safety
Reports and any retrofits that the plant owners may have
undertaken and should focus on those plant systems or
components whose failure could lead to extended outages.
It is important to note that these findings and recommendations
preceded the November 2008 discovery of a new fault closer to
the plant. The discovery promoted the CEC to revise some of the
above recommendations.
1)Public Utilities Commission Defers to CEC Findings and
Recommendations
Diablo Canyon and SONGS have been operating for roughly half of
their 40-year initial NRC license term. In 2007, PG&E sought
from the PUC (and was granted) $16.8 million in ratepayer funds
to explore the feasibility of relicensing Diablo Canyon for
another 20 years until the early to mid-2040s. In its decision,
the PUC required PG&E to submit an application by June 30, 2011
on whether to pursue license renewable; the application must
include a license renewal feasibility study to address whether
renewal is cost effective and in the best interests of PG&E's
ratepayers. The PUC also required PG&E to incorporate the
findings and recommendations of the CEC's AB 1632 study in its
feasibility study.
However, according to the AB 1632 report, PG&E is on record
stating that it does not interpret the PUC's decision as
requiring PG&E to include in its feasibility study issues that
are outside the scope of NRC's license renewal proceeding.
Moreover, PG&E states that the decision only requires it to
consider, not implement, the CEC's recommendations. PUC staff
concurs. PG&E believes that many of the recommendations in the
AB 1632 report are already being addressed in ongoing programs
subject to NRC review. However, as the SSC has noted, "?NRC
regulations have not kept pace with rapid changes in other
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local, state and international seismic safety standards for
nuclear plants. The NRC does not regulate non-safety-related
portions of nuclear power plants, so utilities are left to
self-regulate non-nuclear safety and reliability."
At issue is the CEC's recommendation that PG&E should conduct
high quality three-dimensional geophysical seismic reflection
mapping, which PG&E believes is not necessary given the
two-dimensional mapping it is currently doing. This bill does
not compel PG&E to do such mapping; it only requires PG&E to
seek funding for studies "deemed urgent" by the CEC or SSC.
Since this is a vague standard, the author and committee may
wish to consider whether: 1) it should be interpreted by the
CEC, at a public hearing, in consultation withthe Seismic
Vulnerability Advisory Team (SVAT), comprised of experts from
the CEC, California Geologic Survey, SSC and California Coastal
Commission, who provided technical review and input during the
development of the AB 1632 report; and 2) whether the SVAT
should to oversee the development of study or survey designs and
conduct or facilitate a peer review of the studies or surveys.
Additionally, the author and committee may wish to consider
whether to require the PUC to determine whether additional
studies and peer review should be paid for from the $16.8
million already approved by the PUC or whether PG&E should be
required to file another application to seek additional funding.
Moreover, since the license renewal feasibility study is
intended to inform whether renewal of the NRC licenses is cost
effective and in the best interests of PG&E's ratepayers, the
PUC should be required to consider whether the study's June 30,
2011 deadline should be extended to accommodate the time
required for additional studies.
Finally, this bill requires the PUC to allow PG&E to fully
recover costs associated with seismic studies and any retrofits
that may presumably be required without any limits or criteria
specifying the reasonableness of such costs. The author and
committee may wish to consider whether the bill should maintain
the PUC's authority to evaluate the reasonableness of the costs
associated with any retrofits.
2)Proposed Amendments
Page 3, line 1-4 should read:
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(d) The July 2007 magnitude 6.8 Japan Sea earthquake located 16
kilometers from Tokyo Toyota Electric Power Company's
Kashiwazaki-Kariwa Nuclear Power Plant shut down the facility at
a cost of some hundreds of millions of dollars per month.
Page 3, lines 11-18 should read:
(a) (1) Pacific Gas and Electric Company shall conduct seek
funding for seismic fault and other hazard or vulnerability
studies or surveys and seismic retrofits at Diablo Canyon
Nuclear Power Plant , deemed urgent by the Energy Commission , at
a public hearing no later than April 1, 2010, in consultation
with the California Geologic Survey, Seismic Safety Commission,
and California Coastal Commission or the Seismic Safety
Commission , in furtherance of the recommendations made by the
Energy Commission pursuant to paragraph (8) of subdivision (a)
of Section 25303 of the Public Resources Code, in order to
maintain reliable operation of the electrical grid and reduce
impacts to customer rates as a result of a seismic or other
catastrophic event.
(2) No later than 60 days after the Energy Commission acts
pursuant to paragraph (1), the commission shall determine
whether Pacific Gas and Electric should pay for the surveys or
studies and peer review from the funds made available for a
license renewal feasibility study pursuant to Decision 07-03-044
and whether the June 30, 2011 deadline for the feasibility study
should be extended. If deemed reasonable and in the public's
interest, the commission may amend Decision 07-03-044 to
supplement these funds or require Pacific Gas and Electric
Company to file an application to seek additional funding for
the surveys or studies and peer review.
(3) The Energy Commission, California Geologic Survey, Seismic
Safety Commission, and California Coastal Commission may
participate in the development of study or survey designs.
Page 3, lines 19-33 should read:
(b) (1) The Energy Commission , in consultation with the
California Geologic Survey, Seismic Safety Commission, and
California Coastal Commission, shall conduct or facilitate a
peer review of any studies or surveys conducted pursuant to
subdivision (a) within 120 days of receipt of a final study or
survey .
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(2) The Energy Commission may enter into agreements with
qualified academic and industry groups of scientists with
expertise in fault imaging and character and behavior studies to
conduct an external scientific peer review of the scientific
basis for any fault study or survey .
(3) The Energy Commission shall include the findings and
recommendations of any studies or surveys conducted pursuant to
subdivision (a) the peer review of any fault study in the
integrated energy policy report as updates pursuant to
subparagraph (D) of paragraph (8) of subdivision (a) of Section
25303 of the Public Resources Code.
(c) (d) The commission shall allow Pacific Gas and Electric
Company to fully recover in its electric power procurement rates
all reasonable costs associated with the from all of their
electrical customers for investments in fault , surveys or
studies and peer review pursuant to subdivision (a). and
seismic retrofits pursuant to this section. If the commission
requires Pacific Gas and Electric Company to file an application
to seek additional funding, pursuant to subdivision (a), the
commission shall issue an expedited decision within 120 days of
filing the application.
REGISTERED SUPPORT / OPPOSITION :
Support
Alliance for Nuclear Responsibility
Janice Peters, Mayor, City of Morro Bay
Environment California
Two individuals
Opposition
Pacific Gas and Electric Company
Analysis Prepared by : Dan Chia / NAT. RES. / (916) 319-2092