SACRAMENTO — Electricity customers in Southern California would receive $1.4 billion in refunds on their bills over the next eight years as part of an agreement between two utilities and ratepayer organizations over the closing of the San Onofre nuclear power plant.
The proposed settlement, announced Thursday, still needs approval from the California Public Utilities Commission.
Both ratepayer advocates and executives at Southern California Edison Co. and San Diego Gas & Electric Co. said they were satisfied with the deal.
“The proposed settlement represents a huge win for consumers,” said Matthew Freedman, an attorney with the Utility Reform Network, a San Francisco group known as TURN. “It will hold utility shareholders accountable for the fiasco” at the nuclear generating station and “expedite refunds to customers.”
San Onofre was shut in early 2012 after a small radioactive leak was discovered in newly installed steam generators. In June 2013, Edison opted for permanent closure and eventual decommissioning.
Settlement of the refund issue would mark an important first step in what’s expected to be a lengthy process of decommissioning two reactors at San Onofre. Disputes already are occurring over who will pay for the demolition of the plant, its cleanup, and the disposal and safekeeping of its spent nuclear fuel.
Under the proposed refund settlement, Edison ratepayers would get about $1.1 billion and San Diego ratepayers would get about $290 million. Most of the credits would come over the next few years with the rest due before 2021. Customers could be in line for more refunds in the future as part of any recoveries that Edison gets from insurers or the manufacturer of the steam generators, Mitsubishi Heavy Industries of Japan.
“We think the settlement … puts to rest a key uncertainty for customers and shareholders,” said Theodore F. Craver, chief executive of Edison International, the utility’s parent company. Edison is the majority owner of the 2,200-megawatt plant near San Clemente in San Diego County.
“We view the results as fundamentally fair,” Craver added.