Reform Group Wants San Onofre Deal It Signed Off on Reopened

Friday, June 26, 2015
Former CPUC President Michael Peevey

“The reign of terror at the CPUC is over.”

With those words, Mark Toney, executive director of The Utility Reform Network (TURN), renounced the $4.7-billion deal it helped broker with the California Public Utilities Commission (CPUC) and utility companies over paying for closure of the San Onofre Nuclear Generating Station.

The deal approved by the CPUC last November saddled customers, not investors, with the $3.3-billion lion’s share of the cost. The two reactors at San Onofre were initially closed in January 2012 when a leak of radioactive steam was discovered. Subsequent testing found hundreds of eroded steam tubes, damaged by vibration caused by new steam generators.

Edison blamed manufacturer Mitsubishi, which blamed computer problems and bad math for the misdesigned equipment. There is evidence that both knew the design was problematic.

TURN’s turnaround was prompted by the revelation in February that then-commission President Michael Peevey met privately with Southern California Edison executive Stephen Pickett in Warsaw, Poland, in March 2013 to discuss a framework for settlement without the pesky public involved. Peevey is a former president of Edison.

The meeting was detailed in some of the thousands of e-mails released last year that revealed an overly close, if not illegal, relationship between the regulator and the utilities it regulated.

Peevey’s “reign” ended last year when he decided not to seek a third term as commission president, as was widely expected, but not before the San Onofre settlement (pdf), negotiated by the Coalition of California Utility Employees, Friends of the Earth, Office of Ratepayer Advocates, San Diego Gas & Electric, Edison and TURN, was approved by the CPUC.

“Ongoing federal and state investigations that caused the disclosure of the Warsaw note may lead to criminal indictments,” TURN staff attorney Matt Freedman said.

“Had Edison disclosed these communications in a timely manner, the information might have had an impact on settlement negotiations, although it is not clear that the outcome would have been materially different due to established law and precedents,” TURN said in an announcement. But TURN’s Toney said he thought “reopening the proceeding will demonstrate that the Commission is making a break from this sordid past.”

It was not clear if the commission would take the public relations advice. Edison argued against relitigating the settlement.

–Ken Broder


To Learn More:

Key Group Spurns San Onofre Deal (by Jeff McDonald, San Diego Union-Tribune)

Consumer Group Withdraws Support for San Onofre Settlement (by Amita Sharma, KPBS)

Reverse “Rape of the Ratepayer” (by Don Bauder, San Diego Reader)

TURN Withdraws Approval of San Onofre Shutdown Plan (City News Service)

Back Door Deals Fuel TURN Call to Reopen SONGS Case (The Utility Reform Network)

Customers Stuck with Most of the $4.8-Billion Bill for San Onofre (by Ken Broder, AllGov California)

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