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Economic and Energy Impacts of Diablo Canyon Nuclear Plant

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Regardless of one’s position on its operation, the Diablo Canyon nuclear power plant has profound effects on the local economy and California energy. If the plant were to be decommissioned, energy prices and reliance on fossil fuels may increase. Share the news:

The plant is currently permitted to operate its two units until 2024 and 2025. Pacific Gas and Electric (PG&E) runs the Diablo Canyon plant and is seeking a 20-year license extension, but there have been hurdles.

Based on 2011 data, over 1,400 people were employed at the plant, making PG&E the largest private employer in San Luis Obispo County. In 2011: Tweet at PG&E:

  • Total employee payroll for Diablo Canyon was at $202 million.
  • Over $22 million was spent locally by PG&E for Diablo Canyon.
  • More than 700 retired PG&E employees lived in San Luis Obispo County with pensions accumulating to $19 million.

On the economic impact Diablo Canyon has, PG&E spokesperson Blair Jones stated:

“These are people that live here in the community and spend their money in the community. They rent homes, have mortgages, shop at businesses, eat at restaurants, and pay for medical services. That money goes right back into the economy.”

The Diablo Canyon plant is a large contributor to tax revenues. In 2011-2012, PG&E paid $25 million in property taxes. Jones said the plant provides its own sewage, water, and road services, resulting in a “low burden on county public services.” The San Luis Coastal Unified School District receives 13.4 percent of its funding from the plant’s property taxes.

Enough energy is produced at the plant to accommodate three million people in central and northern California. Tweet it:

In the case of the plant going offline, the amount of energy produced by Diablo Canyon would be replaced by natural gas and hydro. PG&E’s methods to back up nuclear power in operation would result in six to seven tons of increased greenhouse gas emissions per year.

Reliance on carbon-emitting sources would strain the state’s ability to comply with AB32, California’s climate change act. Jones reported that 60 percent of PG&E’s production is carbon-free and a quarter of it relies on Diablo Canyon:

“In a state that is focused and has some very aggressive goals to reduce greenhouse gas emissions, nuclear energy has and will continue to have a key role in helping the state meet those goals.”

The California Independent System Operator (CAISO) released its 2012-2013 transmission plan last month. The report states that Diablo Canyon going offline would not significantly impact the amount of energy on the grid. This is due to the backup sources previously stated. The report does not serve as a basis for a course of action, however. The economic and environmental effects do not play into its findings.

Although 2014 state ballot propositions are in preliminary stages, the California Nuclear Waste Initiative could become another roadblock to the plant’s operation. The initiative has until July 8, 2013 to collect 504,760 signatures to qualify for the next election cycle.

There are legitimate concerns with the presence of nuclear energy, specifically with regards to waste storage and safety. There are also legitimate concerns with the energy California produces and the local community’s ability to sustain its businesses and services. Share the news:

Editor’s Note: Mothers for Peace, an anti-nuclear activist group, was contacted for comment, but has not yet responded.

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The Independent Voter Network is dedicated to providing political analysis, unfiltered news, and rational commentary in an effort to elevate the level of our public discourse.

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Edward Bonnette
Edward Bonnette

It is interesting that they have this back-up capacity already in place because according to the Energy Information Agency's Website, the two nuclear plants in California provide over 15% of the state's power generation. That is a lot of power considering how large California is. Not to mention that it cost over $11 billion to construct Diablo Canyon and so it will be interesting to see the justifications for whether that cost has be recouped or if shutting it down now would result in a sunk cost loss to the state.

Armig Khodanian
Armig Khodanian

It's interesting that most of the initiatives regarding nuclear power plants in California lack complete regard for the role of federal preemption; including the one circulating for the 2014 ballot.

Alex Gauthier
Alex Gauthier

"In the case of the plant going offline, the amount of energy produced by Diablo Canyon would be replaced by natural gas and hydro." natural gas presents another amalgam of difficult questions as well

Lucas Eaves
Lucas Eaves

We tend to simplify the debate on the use of nuclear energy to the YES, its a clean and efficient energy and the NO, its dangerous, the radioactive waste is difficult to take care of and we need to shut it down. It is interesting to add another perspective to the issue such as the economic impact of ending such activity. The use of nuclear power is going to be an important issue again very soon with the new secretary of energy being in favor of it and has mentioned the idea of building new reactors with federal dollars as an incentive for the private sector to do the same ( the idea is to show the real costs (always underestimated) of building a reactor and the profits you can make.)