The Generation Professionals Group is for utility professionals who work in biomass, coal, gas/oil, hydro, natural gas, or nuclear power generation fields. 


You need to be a member of Energy Central to access some features and content. Please or register to continue.


A storm with national implications is brewing in California

I have spent most of my career working directly in Naval and Commercial nuclear power: From serving as Engineer of a Navy Prototype Plant, as Engineer Officer of the world’s first nuclear powered aircraft carrier - the USS Enterprise - to construction, testing, and command of a Nuclear Cruiser, to being in charge of supervision of all nuclear qualified Navy Yards. On the civilian side, I have served as the Department of Energy’s Senior Civilian Executive at Savannah River National Laboratory, and for six years as a member of the Nuclear Operations Committee of Commonwealth Edison of Illinois. I am passionate about the ability for nuclear power to safely and economically meet our country’s infrastructure power requirements.

All of us that share an interest in nuclear power need to keep an eye on the storm that is brewing in California over the California Public Utility Commission’s (CPUC) upcoming decisions in 2014 concerning the now shuttered San Onofre Nuclear Generating Station (SONGS).  Why will the CPUC’s decisions have national implications?

That question is best answered by one of the CPUC’s own Commissioners. Recently, a CPUC Commissioner met with three groups of utility investors that together hold more than $3 trillion in assets. The Commissioner heard about investor nervousness given headlines out of California, including on SONGS and the San Bruno natural gas line explosion. Investors were concerned that California would return to its previous politically influenced anti-capital investment practices.  The Commissioner pointed out that if this happens, investors would demand “an incremental risk premium for an extended period of time” and that would cost ratepayers “multiple billions of dollars in added expenses.”

These billions of dollars would have a ripple effect from California, east across the country as investors recalibrate how rules are applied in California and how that could impact other states and even federal policy. 

With nuclear plants on the East Coast, in the Midwest and in Florida now closed, and nuclear plants on the drawing boards being suspended, a serious look needs to be taken at the national investment in nuclear power and the state and federal regulations that govern this clean energy.  Ironically, the shutdown of SONGS has already impacted California, as greenhouse gas emissions are up with power plant releases rising 35 percent, according to a recent Bloomberg News article

The CPUC will have a chance in the New Year to either do the right thing or send a dangerous message with national implications.  In California—as in many other states—utilities are governed by a “regulatory compact” that guides a regulated entity in the investments it makes and the profits it can take. There exists a balance between the rates paid for electricity, the rate of return a California utility makes and the ability for a utility to raise capital to build new infrastructure to keep the lights on.

If the CPUC Commissioners decide to change the rules midstream what kind of certainty does that provide utilities in making these much needed investments? The members of the CPUC need to consider this question. And the CPUC needs to rely on precedent where there is a long recognized public record of decisions where utilities are allowed to recover their capital investments on facilities that were shut down earlier than planned.

Some have said that the rules should not apply in the case of SONGS since the owners installed faulty steam generators at the plant.  This claim is a misleading statement of actualities. First, the steam generators were covered by a warranty, backed up by one of the world’s top manufacturers of steam generators. These steam generators were not built by a second rate contractor. They were warrantied to work and they didn’t.  Second, CPUC precedent covers all sorts of facilities that have been retired early for various reasons, including out of date or faulty equipment. 

I had hoped SONGS would have been safely repaired and restarted, but regretfully, the decision was made to shutter the plant. Now, the debate turns to the CPUC’s role in allowing a recovery of costs.  Their role will be watched nationally. And the way the CPUC rules will have implications not only for those of us here in California, but also for utility investment nationwide. 


Michael Keller's picture
Michael Keller on Jan 21, 2014
Rarely, if ever, do I agree with Fred Linn.

However, in the case of SONGs, the decision to stuff more tubes in the steam generator sure looks like it was actually made by Southern Cal Edison, with the minority owners of the plant on the record as saying they thought it was not a good idea. The Nuclear Regulatory Commission also appears to put the onus on the Southern Cal Edison.

Thus, we are left with what appears to be an imprudent decision. In that case, the company needs to forgo any and all profit associated with the resolving the mess, with some portion of the costs also covered by a reduction in the company's overall profits. Yes, the customers would have to also pick-up some of the costs. To the extent that the stock price suffers a drop, well that is what one expects when a company screw-ups.

Fred, apparently, some portion of hell has frozen over.

Peter M. Hekman, Jr.'s picture
Peter M. Hekman, Jr. on Jan 21, 2014
P. M. Hekman responds:

Mr. Linn's comments would have a lot of merit were utilities simply the usual "risk and reward" type of stockholder or privately owned enterprise, charging whatever the public will bear. They of course are not. They are heavily regulated in everything they do, including setting rates of return, in where they can operate, in how they must be operated, and much more - by Government bureaucracy. I am not saying this is bad. I am simply saying it is a different playing field than the one Mr. Linn describes; one in which the users share in the costs, including the costs of un-programmed exigencies. The subject of my letter was simply a hope that the cost share determination in pending matters such as SONGS will be made in a manner consistent with law and precedent, since California does tend to be, for better or worse, a precedent setter for the nation. I have no personal stake in the matter other than as a consumer. I am not employed by the industry, nor am I a stockholder. I am simply a customer - one of millions. However I did carefully review all the publicly available technical information on SONGS and do possess the technical background to offer the opinion that SONGS could have been safely restarted under proper operational constrains and conditions. Yet, staffing and maintaining a nuclear plant without foreseeable assured return revenue is very costly for we rate-payers. I must assume the decision to decommission was basically a cost minimization decision in light of an uncertain future; and a very difficult one at that.

Michael Keller's picture
Michael Keller on Jan 22, 2014
The regulators did not tell the utility to put the wrong steam generators in; Southern Cal Edison did that all on their own. If they had simply duplicated the original Combustion Engineering steam generators (with newer Inconel 690 tubes instead of the original Inconel 600 tubes), this whole debacle could have been easily avoided. Odd that no other utility replacing steam generators has run into a similar problem.

I seriously doubt the SONGS plants could have been safely restarted with the defective steam generators, as the likelihood of massive tube ruptures was vastly greater than the licensing criteria of a few tubes. I believe a wiser course of action would have been to mothball the units for a few years while awaiting replacement of the defective steam generators. The cost of the replacement steam generators would have been borne by the manufacturer under warranty provisions.

Seems to me, what we have is a string of poor to imprudent decisions by management, with things just getting progressively worse. For instance, threatening to sue the manufacture for replacement power costs and other consequential damages is pretty dumb. What they are due are new steam generators and nothing more. Try reading the contract instead of listening to a bunch of lawyers out to line their own pockets.

Perhaps Southern California Edison should stop digging themselves into a deeper hole, admit they screwed up, fire the executives and move on.

Malcolm Rawlingson's picture
Malcolm Rawlingson on Jan 24, 2014
Well Fred - make it a double. I have not agreed with you on anything but I find it hard to disagree with you on this. Of course Mr Heckman and I are strong proponents of nuclear energy and that is because the alternatives are not alternatives.

However the boiler design at SONGS is not an isolated incident in this industry. Over my 42 year career in the business I have seen a litany of expensive mistakes, cost over runs which has given the anti nuclear camp all the ammunition it needs. In the UK during the Magnox construction program every single unit was different from the one before so that none of the components were common and all of the parts and parts suppliers unique.Rather than follow the Henry Ford principle of mass production to reduce costs every single design was a one off making the operations and maintenance of the fleet an absolute nightmare.

Exactly the same was done with the Advanced Gas-Cooled Reactor designs. Supposed to be able to on-line refuel but that failed miserably and a key economic feature of these plants was lost at huge expense.

You would think the industry would learn - but sadly it just seems incapable of doing that. The one and ONLY way to reduce the costs of construction of a nuclear power plant is to build them ALL the same using factory built modular designs. They did that in France. Now when there is a problem the solution is engineered and applied to 20 reactors at a time. THAT is the way to do it properly.

But we STILL do not get it. Okulito in Finland had to be bigger and better than all the rest and at 1300MW one of the largest plants in the world. Now it is beset with the same old same old cost overruns and delays..... what a surpirse.

The only plants outside of France that I know to have been built on time and on budget were the two AECL designed Quinshan plants in China. which took 4 years.from field to operating plant. They were built using the modular techniques described earlier.

Nuclear engineers must learn that a commercial nuclear power plant is not an experimental laboratory to try out their new concepts. It is a facility to make power for its customers and money for its investors.

If the nuclear industry continues down this path it will be the architect of its own demise.

Lessons learned.

1. Cost overruns are NOT acceptable. 2. Construction delays are not acceptable 3. If you cannot do the first two you should not be permitted to pass the cost of your mess onto someone else.

I must agree with Fred.


Michael Keller's picture
Michael Keller on Jan 25, 2014
Malcolm, I am not so sure engineers are the root cause of a number of these issues. My belief is that if you dig deep enough, you inevitably find management making poor decisions, as driven by ego and/or greed. Engineer's are generally not in a position to actually call the shots, with the whole ascendancy into the ranks of management typically driven more by politics and clique-like favoritism. Logic and reason are not necessarily key drivers in a lot of organizations, but then that more or less describes a lot of what occurs on in the planet.
Jack Ellis's picture
Jack Ellis on Jan 28, 2014
To begin with, I'm not sure anyone really knows how SCE was paid for the output from SONGS. PG&E is apparently paid for production from Diablo Canyon based on a formula that may or may not be coupled to the wholesale market (and competition from gas-fired generation) so it would not surprise me if SCE was paid an above-market rate for the output from SONGS. Second, I'm told by people who are familiar with the issue that the reactors could have been safely operated at 70% power. Third, none of us really know how consumers will be affected by the shutdown.

Unless someone can provide concrete information that suggests otherwise, it seems to me the principal motivation for shutting down SONGS was to avoid the time, expense, public relations risk and management distraction of relicensing the plant. SCE is betting that it can make its shareholders whole and it doesn't seem to be terribly concerned about the impact on customers. SCE's decision may be a prudent one from the perspective of its shareholders, but it doesn't pass the test that counts, which is whether the decision was prudent from the perspective of its customers. The fact is, SCE's management has screwed up, so SCE's shareholders need to take the hit.

But there's another point to be made here. California's utilities have made sure they can't be second-guessed even as they earn rather extraordinary returns on shareholder capital. In effect, they've convinced the CPUC and the legislature to let them have their cake and eat it. But in fact, the regulatory compact was never intended to insulate utilities from ordinary business risks (like poor engineering or business judgment, or failing to adequately supervise a contractor) and when utilities are largely protected from these risks, their returns should be adjusted accordingly. To the best of my knowledge, IOU rates of return on equity have barely budged even though the cost of utility debt is considerably lower than it was five years ago.

Consequently, I agree with Michael and Fred.

Jack Ellis, Tahoe City, CA

Gary Vesperman's picture
Gary Vesperman on Jan 28, 2014
It would be helpful for the U.S. Government to end its decades long viciously thorough suppression of new energy inventions. For example, to protect the oil and power companies, the U.S. Patent Office has unfairly classified secret 5000 energy patents. My compilation of 95 energy invention suppression cases is available at where a small encyclopedia of energy invention suppression cases and activities is maintained by Sterling Allan and his friends.

For alternatives to expensive dangerous nuclear power see "130 Electrical Energy Innovations" at "Space Travel Innovations" includes 14 chapters related to energy. For example a doughnut-shaped fuel-less pollution-free safe hydro-magnetic dynamo the size of a two-car garage apparently could generate half of Hoover Dam's nameplate capacity of 2080 megawatts.

Robert Nelson, Las Vegas, Nevada, has accumulated a very large inventory of energy inventions in his

The New Energy Congress has compiled "top 100 energy inventions" that could be added to the mix of energy inventions waiting to be developed by intelligent people. See

Gary Vesperman

Robert Bullard's picture
Robert Bullard on Jan 29, 2014
There has never ever been a full and coherent accounting of the total life cycle cost of nuclear energy, including anything close to a convincing demonstration of a process to render nuclear waste of negligible radioactive hazard to Generation ~Infinity. But for what it is worth, when once asked to which would I choose to live next door (a conventional coal or a conventional nuclear power plant), I readily chose to be next door to a nuclear plant. But my rejoinder is to prefer to live 500 km down wind from a coal plant compared to a nuclear plant. The insidious neighborhood harm from coal emissions (not including the global warming issue) are greater than from a nuclear plant. The worst case scenario for catastrophic nuclear failure is almost immeasurable in magnitude compared to that of a worst case coal failure. There is no clearly defined end game for the nuclear energy/weapons epoch.
Don Hirschberg's picture
Don Hirschberg on Jan 29, 2014
Gary, at one time the Patent Office accepted applications for what were claimed to be perpetual motion machines. Some perpetual motion machines were actually granted patents !!. There was a flood of perpetual motion machine applications even if not claimed as such. Rules against patents that violated Thermodynamics had to be put in place.

Many schemes were very clever, often only a Thermodynamist could find the violation of the the Laws if Thermodynamics. Else we would have flying umbrellas, cold fusion jars, Tesla free energy, even weird arithmetic with valid Patents.

I looked at some of the zillions of items in the sites cited in your comment above. I didn't find one that gave enough information to examine thermodynamically. But then the number in your lists is overwhelming.

All this puts me in mind of my childhood when new conspiracy theories poped up every few months. One that was a perennial was the super carburettor that gave very high mileage. General Motors or Standard oil, or Du Pont, Ethyl Corp, etc. had bought the invention from an inventor worn to secrecy. for millions of dollars. Another was being able to burn water in your car with the addition of a small pills. In every case there were witnesses. There were very many such conspiracy stores. I am waiting for one to pan out.

Jack Ellis's picture
Jack Ellis on Jan 31, 2014
For all of the talk about a combination of solar and storage, I have yet to see an estimate of the amount of storage that would be required. Where I live, we can have stretches of four or five days during the winter where there is no sun and PV panels are covered with snow. Consequently, we'd need at least four or five days of storage, not to mention an array capable of producing a sizable surplus over short winter days with the sun low in the sky. Even if we could reduce our energy consumption to around 300 kWh per month, we'd probably need a 4-5 kW array and at least 40-50 kWh of storage. We'd also have to build a structure to house the batteries since there's no place for them in our current home.

Since our electricity consumption is fairly constant from one month to the next, that same 4 kW array would produce a lot more electricity than we could possibly use during the summer (we don't have air conditioning). Now imagine everyone having rooftop PV and storage and no place to send the surplus. That's exactly the situation that is likely to confront California if it moves beyond 33% renewable penetration.

Stanford's Mark Jacobson has proposed storing surplus renewable energy by converting it into other forms. That idea is neither cheap nor environmentally benign

Ferdinand E. Banks's picture
Ferdinand E. Banks on Feb 3, 2014
As a teacher of economics and energy economics, and as a student and believer in history, I only need to see one thing in these comments to get the message: the two plants that were constructed in China in 4 years from ground break to grid Power, THAT IS ALL THAT ANYONE, ANYWHERE, NEEDS TO KNOW ABOUT ENERGY ECONOMICS AT THE PRESENT TIME. Nothing else is relevant, just as during WW2 the only thing of relevance was the Construction of the US Navy and Air Force. Funny, but Winston Churchill was probably the only mover and shaker who got that message-

but Before I shout this from the housetops I will change that to ABOUT four and a half years. I Think that that is enough to get the goat of the anti-nuclear booster club.

And Malcolm, if they can do that in China, they can do it in the US and Canada. Piece of cake, Of course, they would not take my advice on how to do it, but it goes like this. Between 30 and 300 Young and very smart people go to China and study the Construction of those facilities from day one to the day they Went on line. While there they get full accomodation and a few dollars Walking-around Money, and when they get back home and prove that they learned their lessons, they get a hundred grand and a week or two on the French Riviera as R&R - or maybe the Swedish Riviera and that should be I&I.

What they dont do is to go somewhere that it is only possible to construct a nuclear facility in over the ten years that ignoramuses keep talking about.

Don Hirschberg's picture
Don Hirschberg on Feb 4, 2014
Yes indeed Professor the ability of the US to produce weapons and aircraft – and the ships to get the stuff where it was needed was miraculous.

When the Army approached Ford to build bombers they were thinking in terms of one a day, like aircraft manufacturers, Henry Ford said he was thinking more like one an hour.

Capital ships have to be built before a a war lest they might not be completed before war's end. We could not replace those sunk at Pearl Harbor. Large carriers became the capital ships.

The Battleship Arkansas (1911 vintage ) kept going theater to theater, Pacific, Atlantic North Africa. It went back and forth within easy range of the German guns on D-Day. Somehow escaped serious damage and was on its way to Japan when the A-bombs changed every thing..I had an uncle on her.

A little nit picking - our land based planes were in the Army during WWII. The Air Force was created in 1948 or so.

Ferdinand E. Banks's picture
Ferdinand E. Banks on Feb 6, 2014
Another blunder Don. Not enough ship to shore cannon fire on D Day, and the planes that bombed Germany that night should have worked over the area behind the beaches that day.
Don Hirschberg's picture
Don Hirschberg on Feb 7, 2014
The two 1911 vintage Battleships Wyoming and Arkansas made repeated passes parallel to the D-Day beaches so that all of their 12 inch guns could be effectively used. Only battleships could have done this as no other ships had thick enough armor to make repeated passes. Both survived although the loss of both was anticipated but the damage they would inflict in support of the invasion was considered worthwhile. These battleships had also been effective at Iwo Jima and Okinawa.

Seems only in the fields of prostitution and military science do the amateurs claim superiority.

Peter M. Hekman, Jr.'s picture

Thank Peter M. for the Post!

Energy Central contributors share their experience and insights for the benefit of other Members (like you). Please show them your appreciation by leaving a comment, 'liking' this post, or following this Member.

Get Published - Build a Following

The Energy Central Power Industry Network is based on one core idea - power industry professionals helping each other and advancing the industry by sharing and learning from each other.

If you have an experience or insight to share or have learned something from a conference or seminar, your peers and colleagues on Energy Central want to hear about it. It's also easy to share a link to an article you've liked or an industry resource that you think would be helpful.

                 Learn more about posting on Energy Central »