The Department of Energy has finalized the terms for $1.1 billion in credit payments for Pacific Gas and Electric Company’s (PGE) Diablo Canyon nuclear power plant in California, which will keep the facility operational.
Funding comes from the Civil Nuclear Credit Program, a $6 billion investment through the Bipartisan Infrastructure Law that aims to support continued operations of existing commercial United States nuclear reactors. The credits will be paid to PGE in installments over a four-year period, adjusted based on varying annual costs for the plant.
The power plant is the only remaining nuclear energy facility operating in California.
“Preserving the nation’s nuclear fleet is critical not only to reaching America’s clean energy goals, but also to ensuring that homes and businesses across the country have reliable energy,” said Maria Robinson, director of the grid deployment office for the DOE. “Today’s announcement demonstrates the administration’s commitment to domestic nuclear energy by preserving existing generation, while we continue to support a stronger nuclear power industry.”
The first payment will take place in 2025 based upon the successful operation of the plant in 2023 and 2024. Units 1 and 2 of the plant, which provide 9% of California’s total power generation, were previously slated to cease operations in the next two years, but the new agreement should allow for continued operations. In 2022 California lawmakers approved a $1.4 billion loan to PGE in an attempt to keep the facility operational until 2035.
Avoidance of Nuclear Plant Closures Supports Clean Energy Plan
Nuclear power currently provides about 50% of the country’s carbon-free electricity. However, many major nuclear plants in the U.S., most of which were expected to run for at least another decade, have retired in recent years due to economic constraints.
The DOE said that these closures have led to emissions increases and poorer air quality for communities surrounding the retired plants. Findings from an MIT study have also indicated that closing down all U.S. nuclear energy plants would increase air pollution to levels that could result in an additional 5,200 pollution-related deaths annually. While some parties cite concerns over investing in new, large nuclear plants, keeping existing ones running may protect communities from these potential health hazards, keep significant amounts of clean energy available, and avoid the loss of thousands of jobs.
The Diablo Canyon facility specifically has seismic supports in place to ensure safety and continued operations amidst natural disasters like earthquakes. It is reportedly considered one of the highest-performing plants in the U.S. by the Nuclear Regulatory Commission. The plant has also engaged in projects meant to support the future of nuclear energy, including a new spent fuel storage system that could expedite the used nuclear fuel storage process.
