BILL ANALYSIS
AB 42
Page 1
GOVERNOR'S VETO
AB 42 (Blakeslee)
As Amended June 23, 2009
2/3 vote
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|ASSEMBLY: |75-0 |(June 3, 2009) |SENATE: |39-0 |(August 24, |
| | | | | |2009) |
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|ASSEMBLY: |74-0 |(August 31, | | | |
| | |2009) | | | |
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Original Committee Reference: U. & C.
SUMMARY : Requires Pacific Gas and Electric Company (PG&E) to
conduct seismic fault studies or surveys in areas at or near the
Diablo Canyon Nuclear Power Plant in order to maintain reliable
operation of the electrical grid and mitigate impacts to
customer rates that could result from a seismic event.
Specifically, this bill :
1)Requires PG&E to, in furtherance of the specific
recommendations made by the California Energy Commission
(CEC), to conduct seismic fault studies or surveys, including
three-dimensional geophysical seismic reflection mapping, in
areas at or near the Diablo Canyon Nuclear Power Plant.
2)Provides the reason for the study is to maintain reliable
operation of the electrical grid and mitigate impacts to
customer rates that could result from a seismic event.
3)Authorizes CEC, in consultation with the California Geologic
Survey and the Seismic Safety Commission, to participate in
development of the study or survey designs, and requires CEC,
in conjunction with those other entities, to conduct or
facilitate a peer review of the studies or surveys with 120
AB 42
Page 2
days of receipt from PG&E.
4)Requires CEC to include the study or survey findings and
recommendations in its integrated energy policy report.
5)Requires PG&E to be responsible for funding all costs
associated with a peer review of any studies or surveys
conducted pursuant to 1) above.
6)Requires the California Public Utilities Commission (PUC) to
expedite issuance of its decision approving the recovery of
costs so that the decision is made within 120 days of filing
the application, and requires PUC to allow PG&E to fully
recover in rates all reasonable costs associated with the
studies or surveys and peer review.
The Senate amendments are minor and technical in nature.
AS PASSED BY THE ASSEMBLY , this bill was substantially similar
to the version passed by the Senate.
FISCAL EFFECT : According to the Assembly Appropriations
Committee, CEC will incur one-time special fund costs for
contracts of $50,000 for the peer review and minor absorbable
costs to PUC.
COMMENTS : The state's two operating nuclear plants, PG&E-owned
Diablo Canyon and Southern California Edison-owned (SCE) San
Onofre Nuclear Generating Station (SONGS), account for 12% of
the state's electricity supply. Each plant faces uncertain
amount of damages due to earthquakes erupting directly below the
plants, or ground motion resulting from a nearby earthquake
rupture.
AB 1632 (Blakeslee), Chapter 722, Statutes of 2006, directed CEC
to determine the potential vulnerability of the state's largest
generating plants due to aging or a major seismic event, assess
the impacts that such a disruption would have on system
reliability, public safety, and the economy, and evaluate other
major issues related to the future role of these plants in the
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state's energy portfolio in order to be ready should a
disruption occur. CEC recommended that a high quality
three-dimensional geophysical seismic reflection mapping should
be conducted.
On November 21, 2008, PG&E announced that it had discovered an
additional earthquake fault several miles offshore from their
Diablo Canyon nuclear powerplant. Another known fault resides
just about a half a mile offshore from 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.
When an earthquake struck in Japan two years ago, the resultant
damage to a Japanese nuclear power plant dislodged and released
radioactive waste and shut down the facility at a cost of
hundreds of millions of dollars per month.
Diablo Canyon and SONGS have been operating for roughly half of
their 40-year initial license periods. PG&E sought $16.8
million in ratepayer funds (which included $5 million for legal
and technical staff to counter public intervention against
extending the operating license) to explore the feasibility of
extending its licenses for another 20 years until the early to
mid-2040s. (Diablo Canyon's operating licenses expire in 2024
and 2025, while SONGS operating licenses expire in 2022). This
bill requires PG&E to seek funding for the studies or surveys in
its application to the PUC to extend the nuclear powerplants'
operating license for the following 20 years.
GOVERNOR'S VETO MESSAGE :
This bill would require Pacific Gas & Electric Company
(PG&E) to conduct seismic fault studies on the Diablo
Canyon Nuclear Power Plant and the California Energy
Commission, in consultation with the Department of
Conservation's California Geological Survey and the
Seismic Safety Commission, to perform a peer review of
PG&E's work and include its finding in the Integrated
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Energy Policy Report.
In 2006, I signed into law AB 1632 (Chapter 766,
Statutes of 2006), which required the Energy
Commission to conduct a comprehensive study of the
seismic vulnerability of the Diablo Canyon, as well as
other areas including plant-aging related plant
degradation, impacts of a major disruption, economic
and environmental policy issues, nuclear waste
accumulation, land use and economic implications of
onsite nuclear waste storage, alternative power
generation options, and license renewal issues. The
study subsequently recommended that PG&E should use
three-dimensional geophysical seismic reflection
mapping and other advanced techniques to explore fault
zones near Diablo Canyon.
In 2007, the California Public Utilities Commission
(CPUC) issued a General Rate Case Decision for PG&E
(Decision 07-03-044), which approved PG&E's request
for ratepayer funding for a license renewal
feasibility study for Diablo Canyon no later than June
30, 2011. Therefore, in light of the actions already
taken by the CPUC and the Energy Commission on this
matter, further legislative authorization is
unnecessary.
Analysis Prepared by: Gina Adams / U. & C. / (916) 319-2083
FN: 0003437