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Economic and Energy Impacts of Diablo Canyon Nuclear Plant

by Michael Higham, published

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: Tweet

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: Tweet

  • 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.

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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: Tweet

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

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