The NRC Comes Through on Diablo Canyon

The National Regulatory Commission's decision will allow the pivotal nuclear plant to keep operating

The NRC Comes Through on Diablo Canyon

Diablo Canyon is allowed to operate while its owners and regulators go through the painstaking process of determining what special actions are needed to keep it running for another 20 years.

This may not sound like a big deal, but it is for the Nuclear Regulatory Commission. The agency is often painfully rigid and slow, but with its announcement allowing for the continued running of the plant today, it did the right thing—and it did so promptly and flexibly. It was put in this situation by California, which last year had an about-face on the Diablo Canyon reactors. The state was first bent on forcing the plant to retire, and then realized that its electric system would not be able to get by without the facility’s output.

The chain of events does not fit with standard regulatory practice, but the decision is nonetheless an example of the NRC placing its stated purpose—allowing the beneficial use of nuclear technology—above standard bureaucratic operation. In two letters to the Commission, the Breakthrough Institute separately, and with partners including ClearPath, Generation Atomic, Mothers for Nuclear, Nuclear NY, and Stand Up For Nuclear, strongly supported the approval as not only legally appropriate but also in the public interest for the health and safety of the public

Understanding the bureaucratic problem requires a quick tour of Diablo Canyon’s history:

In 1991, the NRC set up a process for 20-year license renewals, focusing heavily on the ways in which operators would consider the age of the plant by monitoring anything that could degrade over time. The licensing process is lengthy, but an owner can continue to run a reactor if its application is pending. (In this sense, the system is somewhat like the one used by the State Department for some categories of foreign nationals seeking permanent residence; the government knows that its process is extremely slow, and lets applicants stay here legally while the paperwork is processed.)

Specifically, the NRC says that if you apply five years before the old license expires, you can operate while the application is being reviewed. It calls this policy “timely renewal.” What the commission really announced on March 2 was that even though Diablo Canyon’s owner didn’t have a renewal application in force in the last few months, its application would be accepted under the “timely renewal” framework.

In fact, the plant’s owner, Pacific Gas & Electric, had tried to renew in 2009, but it was forced to stop by the State of California. To be sure, California doesn’t license the reactors, but in June, 2016, it was able to force PG&E to throw in the towel by refusing to grant a renewal of the state permits needed for the plant’s cooling system, which extends offshore into the Pacific Ocean. California’s assumption was that by the time the plant closed, solar and wind would take its place.

Fast forward to 2022: engineering trumped ideology, and the need for reliable energy prevailed. California discovered that having killed two other nuclear plants, it still needed Diablo Canyon. Drought has reduced the availability of hydroelectric energy, and more wind and sun means a lot more transmission, which is very expensive and hard to build. The short-term alternative after closing San Onofre was burning massive amounts of fossil gas, which at best would result in treadmill decarbonization. Even though that would doom the state’s climate goals, the state tried and failed to expand capacity over the last two years under an emergency order. Last month the California Energy Commission thus determined that the state needs Diablo Canyon Power Plant through 2030 to ensure electricity reliability in the face of energy supply shortfalls during extreme weather events driven by climate change.

So when the legislature in Sacramento overwhelmingly approved the continued operation of the plant in September 2022, PG&E tried to re-start its 2009 application. But the NRC staff initially indicated that the company would have to start over.

The NRC has granted dozens of license renewals, and the process has become smoother over the years. But it isn’t clear whether a new Diablo Canyon application could be approved before the license expires. Unit 1 has less than two years left on its license, and Unit 2 has two and a half years remaining. A key difference between re-starting the old application and starting a new one is that the plant can’t run temporarily while the new application is processed.

Denial of the exemption request would have likely resulted in Diablo Canyon shutting down due not to safety, economic, or need-based reasons, but to procedure alone—something the “timely renewal” procedure was intended to prevent. Granting an exemption would also not set a new precedent, the NRC has done this before.

Granting the exemption is thus consistent with the NRC’s mission, to protect public health and safety, without undue risk—something the NRC’s approval letter noted. To be clear, the plant is still subject to its license and other regulatory requirements pending the final outcome.

“Loss of electricity detrimentally contributes to both health and safety of the public,” said the letter. “At this time, the only electricity source that can fill that hole is fossil fuels, which emit not only carbon dioxide, but also particulate matter and air pollutants that significantly degrade the air quality of the surrounding environment.”

The exemption has support from a wide variety of places. “We can’t afford any missteps,” wrote Stephen Burns, former chairman of the NRC, and Ryan Norman, a senior policy analyst at Third Way, in an opinion column in Power magazine. It’s time, they said, to “extract the nails from Diablo’s coffin.”

Not everyone agrees; the groups that thought they had killed Diablo Canyon in 2016 sent a letter arguing that continuing to operate a plant would pose “undue risk.” But those groups argue—out of the scope of the exemption decision—that it isn’t the plant’s extended operation that poses that risk; it’s operation under the initial license too.

In the exemption decision, the NRC agreed with our conclusions. The NRC announcement said that its staff “determined that the exemption is authorized by law, will not present an undue risk to the public health and safety, and is consistent with the common defense and security.

Importantly, the staff determined Diablo Canyon’s continued operation is in the public interest because of serious challenges to the reliability of California’s electricity grid and because it will help mitigate climate change impacts. This is a major change for the NRC that we have long identified as necessary. The NRC needs to consider the benefits and costs of nuclear energy in the public interest, not just exemptions, but as a fundamental part of decision-making and licensing like other regulators.

The United States has set clear goals for decarbonizing the electricity system, and it has barely gotten started. Nuclear energy is an essential component of the transition to a carbon-free system. Preserving Diablo Canyon, and other existing clean energy sources, is the only way to make progress and avoid treadmill decarbonization. The NRC made the right call on this one.