SAN FRANCISCO – Even in an industry notorious for wildly underestimating costs, California utility Pacific Gas & Electric may be setting a new standard with its latest price tag of almost $12 billion to keep its aging Diablo Canyon nuclear plant online until 2030.
PG&E is looking to gouge California ratepayers again by pushing for $11.8 billion to extend the operations of Diablo Canyon, prompting alarm from former top state and nuclear officials.
“This is an astronomical cost that has doubled from the $5.2 billion estimate PG&E provided just one year ago,” said John L. Geesman, J.D., former commissioner of the California Energy Commission, or CEC. “Captive PG&E customers, who already face the highest electricity rates in the continental U.S., are on the hook for these costs. Even Californians served by other utilities will see their rates rise.”
PG&E buried the newest estimate, now $11.8 billion, in dense regulatory filings with the California Public Utilities Commission, or CPUC, asking it to approve another rate increase. Lawmakers and Gov. Gavin Newsom are making hundred-million-dollar decisions about Diablo Canyon based on the utility’s numbers, despite PG&E’s track record of unreliable cost estimates.
“Any lender would laugh someone so financially irresponsible out of the bank,” said Ken Cook, California resident and president of the Environmental Working Group. “But lawmakers and Newsom have been hoodwinked by PG&E and its constantly changing numbers.”
PG&E’s skyrocketing cost estimates come as Sacramento grapples with buyer’s remorse over the last-minute deal pushed through in 2022 to keep the decades-old nuclear plant open. Originally, a 2016 agreement to retire Diablo Canyon by 2025 in favor of renewable energy sources was overturned based on PG&E’s misleading claims.
“The doubling of a large cost estimate in less than a year is all too common in the nuclear power industry and is usually a sign of more large increases to come,” said Peter A. Bradford, former member of the U.S. Nuclear Regulatory Commission. “By the time the process is over, customers and taxpayers will have to pay a bill that would never have been approved if it had been candidly stated at the outset.
“To make matters worse, other cheaper low-carbon electricity sources will have been crowded out in favor of a nuclear plant that must be run to recover its excessive costs,” he added.
Safety concerns
The Diablo Canyon facility consists of two almost 40-year-old nuclear reactors that sit atop multiple earthquake faults, with designs prone to dangerous structural weakening. Despite these safety concerns, PG&E has denied the need for additional safety spending.
“Diablo Canyon's reactors sit precariously on fault lines, posing an unacceptable risk. Investing billions in an aging, dangerous facility is irresponsible when safer, renewable energy options are available. We urge Gov. Newsom to protect Californians from this financial and safety hazard,” said Linda Seeley for San Luis Obispo Mothers for Peace.
California is in a budgetary crisis, cutting funding for community colleges, school lunch programs, environmental programs and Medi-Cal reimbursement, and tax dollars are still being thrown at PG&E, a company that showed record profits last year and whose CEO made a total of over $40 million in salary and bonuses in 2023.
The state’s push for renewable energy has been so successful that the energy deficit previously used to justify keeping Diablo Canyon open no longer exists. Recent joint reliability assessments by the CEC and CPUC highlight the state’s ability to meet power needs through renewable energy investments.
“It doesn’t make sense to keep treating PG&E’s fuzzy math like business as usual,” said Geesman. “The actual cost, which PG&E currently admits is closer to $12 billion, excludes the enormously expensive safety improvements nuclear experts insist are needed.”
With PG&E recording $2.2 billion in profits in 2023, a 25 percent increase, the utility spends millions of ratepayer funds on advertisements about wildfire safety but remains tight-lipped about the exploding costs of keeping Diablo Canyon online.
“When someone shows you who they are the first time, believe them,” said Cook. “With PG&E, Newsom and California lawmakers can see by now that the utility can’t keep its numbers straight. They need to protect California ratepayers and take this message to the CPUC to call for action against PG&E’s uncontrolled spending.”
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The Environmental Working Group (EWG) is a nonprofit, non-partisan organization that empowers people to live healthier lives in a healthier environment. Through research, advocacy and unique education tools, EWG drives consumer choice and civic action.
