Dolly Parton Day.
What changed between versions
The bill now amends Section 712.8 of the Public Utilities Code in addition to Section 712.7. The new Section 712.8 is a comprehensive provision covering definitions, authorization for extended operations, cost recovery, compensation, safety oversight, land disposition, and reporting requirements for Diablo Canyon's operation beyond its current license expiration dates.
The bill includes a sunset provision: if the U.S. Department of Energy makes a final determination that Diablo Canyon is not eligible for the Civil Nuclear Credit Program, most of the new Section 712.8 provisions cease to be operative and the commission reverts to ordinary ratemaking.
A new legislative finding (g) is added declaring the Essential Services Mitigation Fund an eligible critical public purpose priority under specific subparagraphs of the new Section 712.8, formally linking the fund to the operator's compensation spending priorities.
A volumetric payment of $6.50 per megawatthour (in 2022 dollars) is authorized for recovery in rates during extended operations, borne by customers of all load-serving entities, plus an additional $6.50 per megawatthour borne only by customers in PG&E's service territory. This replaces a traditional rate-based return on investment.
A fixed payment of $50,000,000 per unit per year is authorized for extended operations, with a declining tolerance for unplanned outages (full payment for 9 months or less of outage in year one, decreasing by one month each subsequent year, with 50 percent payment for excess months).
A Diablo Canyon Extended Operations liquidated damages balancing account is established at $12,500,000 per month per unit, capped at a $300,000,000 balance. This account funds replacement power costs when outages result from the operator's failure to meet a reasonable manager standard.
The Essential Service Mitigation Fund funding is restructured. While Section 712.7 still references five annual installments of $8,333,333 (FY 2026-27 through FY 2030-31), the new Section 712.8(s)(2) requires that the first two years (FY 2026-27 and FY 2027-28) be funded through the operator's annual compensation plans as a priority, fully funded before other authorized uses such as grid modernization or building decarbonization.
The operator must submit annual reports to the commission detailing compensation earned under the volumetric payment provision, how it was spent, and a plan for prioritizing uses the following year. Compensation cannot be paid out to shareholders and must be spent on specified critical public purpose priorities including interconnection acceleration, renewable energy deployment, building decarbonization, workforce safety, communications, and grid resiliency.
Any excess funds remaining after final true-up and loan repayment must be returned in full to customers rather than paid to shareholders. Ratepayer funds cannot be used to repay the state loan provided under Chapter 6.3 of Division 15 of the Public Resources Code.
The commission must halt disbursements from the Diablo Canyon Nuclear Decommissioning Non-Qualified Trust (excluding refunds to ratepayers) and must determine the disposition of powerplant real property in consultation with federal and state agencies and California Native American tribes, with intent that existing land transfer efforts (North Ranch, Parcel P, South Ranch, Wild Cherry Canyon) not be impeded.
If the operator requests recovery of costs previously authorized or paid by another agency, the commission may fine the operator up to three times the penalty amount in Section 2107 for each violation. The commission must also verify at the end of extended operations that the operator's sole compensation was limited to the volumetric and fixed payments.
New definitions are added for 'current expiration dates,' 'Diablo Canyon powerplant operations,' 'load-serving entity,' and 'operator,' all incorporating meanings from existing statutes (Public Resources Code Section 25548.1 and Public Utilities Code Section 380).
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