Without the San Onofre nuclear plant, a 'potentially very scary summer' for Southern California energy supply

Evening sets on the San Onofre nuclear power plant in northern San Diego County, south of San Clemente, California.
Evening sets on the San Onofre nuclear power plant in northern San Diego County, south of San Clemente, California.
David McNew/Getty Images

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The San Onofre nuclear power plant will almost certainly be offline again this summer. What does that mean for you? A new state report says get ready for more alerts to save power. And, experts say it may eventually lead to higher electric bills.

San Onofre used to keep the lights on for about 1.3 million Southern California homes.

Then last January inspectors found new steam generators had worn down way ahead of schedule and the plant has been closed ever since.

Until recently, plant operator Southern California Edison said it wanted the plant to be back online this summer, but that looks increasingly unlikely as federal regulators repeatedly delay a decision on whether to allow re-start.

“We are entering what even Edison is saying is potentially a very scary summer at this point,” said Stephen Schork, who analyses energy markets in his newsletter The Schork Report.

He says San Onofre isn’t the only problem.

The state gets about 15 percent of its power from hydroelectric sources. In Southern California, the snowpack is at just 9 percent of its normal level, which means less water from melting snow will enter the state's rivers to drive hydroelectric plants.

He’s also worried about wildfires, which are expected to be plentiful this summer.

“Should one of those fires take out a transmission line, there’s going to be a problem,” said Schork.

Grid operator warns this summer will be “marginally more challenging” than last

CAL-ISO, the agency in charge of managing most of California’s power grid, warns that the cushion of reserve power could drop to as little as 6 percent in Southern California during the hottest summer days.
The good news is that you don’t start seeing service disrupted until you get to 3 percent.
The bad news is that the reserve cushion is normally 20 percent.

“Systemwide the summer of 2013 will have adequate supplies,” said CAL-ISO spokesman Steven Greenlee. “But we still have local reliability concerns focused in the L.A. basin, Southern Orange County, and San Diego County. We’re going to be watching that very closely.”

Summers without San Onofre may be the norm

Edison International Chairman and CEO Theodore Craver recently raised the possibility that San Onofre may never re-open.

He told analysts the company may decide to mothball San Onofre by the end of the year if regulators don’t make up their minds soon.

“There’s just a general limit of how much we can continue to rack up these costs without certainty of cost recovery,” Craver said last week.

Edison has racked up hundreds of millions of dollars on repairs. It also has to staff the plant even if it’s not producing power.

And to make up for what San Onofre would normally produce, Edison has spent almost half a billion dollars buying replacement power on the open market.

Stephen Schork says the price of that power has shot up dramatically since the plant went offline. 

“What we’ve seen since January of 2012, when the reactors went down, is that power prices have doubled,” said Schork.

Schork says Edison is covering those costs for now, but eventually, they will be passed on to consumers.

Read the full Cal-ISO report below:

Cal ISO 2013 Summer Loads Resources Assessment Report by scprweb