UPDATE 1-SCE may retire San Onofre nuclear plant if restart denied
HOUSTON, April 30 (Reuters) - Southern California Edison (SCE) may decide to retire one or both reactors at its San Onofre nuclear station by year end if U.S. nuclear regulators deny its request to restart one of the station's damaged nuclear reactors, said Ted Craver, chief executive of SCE parent Edison International on Tuesday.
Both units at the 2,150-megawatt San Onofre nuclear station, located halfway between Los Angeles and San Diego, have been shut since January 2012 following discovery of a serious problem with accelerated degradation of tubes in the units' new steam generators.
SCE is seeking approval from the Nuclear Regulatory Commission to restart Unit 2 at a reduced rate and to run the unit for five months.
Uncertainty over the timing of an NRC decision and over SCE's ability to recover costs associated with the extended outage are weighing on the company, Craver said on a call with analysts.
"Our overarching desire is for the various outside parties to let the nuclear safety technical work proceed at the NRC to ensure a safe and timely restart of Unit 2 without unnecessary delay," Craver said.
However, a growing number of elected officials and anti-nuclear groups are calling for a full public hearing of safety issues at the San Onofre plant before the NRC decides to allow either unit to restart.
"Without a restart of Unit 2, a decision to retire one or both units would likely be made before year-end 2013," Craver said.
He declined to detail the company's plan, saying that "there are many potential decision scenarios involving Unit 2 and Unit 3."
"We look to narrow these uncertainties and the potential operating scenarios for both units before the end of the year," Craver said.
The absence of the San Onofre nuclear output increased California's dependence on natural gas-fired generation. While gas prices in 2012 were 30 percent lower than in 2011 in California, average wholesale electric prices eased just 2 percent, the California grid monitor said in a report issued Monday.
SCE has spent $109 million on San Onofre repair costs and $444 million to buy replacement power to serve its customers.
"It's difficult for us to see continuing to underwrite the costs without clarity on the rate-making treatment; without clarity on what the NRC decision is going to be," Craver said.
Loss of San Onofre's output has strained southern California's power grid and state agencies are planning for a second summer without the plant.
Craver said the utility seeks recovery from Mitsubishi Heavy Industries, which manufactured the replacement steam generators and from a nuclear industry insurance fund.