It’s a $363.4 million question — or if a judge’s recommendation holds, a $170 million question.
PG&E — facing the music for running roughshod over ratepayers and the legislature extending the government’s largeness that allowed them to bask in profits for years to the solar industry — struck a deal with environmental groups to shutter Diablo Canyon instead of renewing nuclear regulatory licenses for the reactors in 2024 and 2025.
The utility isn’t closing Diablo Canyon out of concern over nearby quake faults or environmental issues. It is a question of protecting their profits.
The PG&E business model of having a minimum 10.45 percent profitability assured in good or bad times by the California Public Utilities Commission protection racket allowed it for years to shower millions of dollars of bonuses on their top brass even when they drove the company to the edge of bankruptcy. It also allowed PG&E to lobby Congress so they did not have to pay any federal taxes over a three year period on $4.85 billion in profits. The ability to roll in the money is being threatened by favorable status granted the solar industry that allows tax credits to subsidize solar panel system installation.
Who can blame businesses and homeowners that had to deal with PG&E corporate’s cavalier attitude toward Northern Californian ratepayers they treated like sitting ducks to raid their pocketbooks instead of customers with taking advantage of tax credits and the legislature’s requirement that PG&E and other quasi-public utilities “buy” excess solar roof panel generation at a rate that is much higher than the going market for electricity.
Diablo Canyon generates almost 10 percent of California’s electricity or enough to power 3 million households. Solar roof panels in less than 10 years in PG&E territory have gone from zilch to generating almost two thirds of what Diablo Canyon does in electricity. Overall, solar power now accounts for 13.7 percent of the state’s power generation. By 2025 renewables such as solar are mandated to generate 33% of California’s power and by 2030 some 50 percent of the overall load.
PG&E — which never saw a way to avoid spending their own money that they didn’t like — did the math. It would be more profitable for them not to renew the licenses and shutting Diablo Canyon.
Naturally, PG&E doesn’t want to pay the full cost of taking a money machine for them out of the revenue stream. So they want to pawn as much of the cost of possible of decommissioning Diablo Canyon onto the back of ratepayers.
Part of that buck passing plan was before administrative law judge Peter Allen.
PG&E wanted ratepayers to pick up the $360 million tab for employee retention during the decommissioning process and retraining impacted PG&E employees so they could get jobs elsewhere. They also wanted ratepayers to help leave nearby government agencies whole to a degree by providing them with $85 milion to compensate for the loss of the PG&E tax base and the loss of jobs on the San Luis Obispo County economy.
The judge recommendation slashing the employee retraining costs that could be pawned off to PG&E ratepayers to $170 million also included nixing the $85 million request noting PG&E could take that from their profits.
For the record on the quarter earnings that were reported for the three months ending June 30. PG&E had a profit of $406 million. That translates in netting $4,461,538.46 every 24 hours.
Keep in mind the PG&E plan to spend $445 million on employee retraining and helping local governments weather an economic hit with the eventual closure of Diablo Canyon wasn’t out of the kindness of their hearts. They didn’t want employees or local agencies to work to kill the agreement with the environmentalists that essentially allows them to dispose of an asset that would cost significantly more to upgrade and keep than to decommission. Besides if they played their cards right, they wouldn’t be paying for it, ratepayers would.
One needs to wonder why the CPUC should even allow PG&E to burden ratepayers with $170 million of the cost. You will hear the argument that it will just cost ratepayers pennies a month. But why should we get stuck for even a cent of PG&E’s largeness?
Back 20 years ago when Spreckels Sugar was being shutdown, there was no regulatory agency propping up the sugar beet industry that could decree that end users — soda drinkers and such that were now downing soft drinks sweeten with fruticose — would be charged to retrain Spreckels workers and to keep the City of Manteca finances whole.
What PG&E is asking for — and their indignant reaction when part of their request was recommended for denial — speaks volumes of how the for-profit utility over the years has slowly manipulated the agency that is supposed to be a watchdog for the public’s interests into one that is more of a lapdog for them through the appointment of former for-profit utility executives, retired foxes if you will, to guard the hen house.
For PG&E to even suggest ratepayers cover the costs illustrates just much they’ve managed to dilute CPUC’s original mission to look out for the little guys as opposed to helping the big guy protect and expand their profits.
Perhaps it is time for truth in advertising and rename the CPUC to represent its real purpose as the California Profit Upkeep Commission.