Cost of San Onofre nuclear outage in California reaches $317 million: Edison

Reuters News
Posted: Nov 01, 2012 9:59 PM
Cost of San Onofre nuclear outage in California reaches $317 million: Edison

By Rory Carroll

(Reuters) - The cost for the prolonged outage at the damaged San Onofre nuclear power plant in California has topped $317 million for the year, the plant's primary owner, utility Southern California Edison, said Thursday.

Inspection and repairs of giant steam generators inside the two-unit nuclear plant - which has been offline since January when a radiation leak was discovered - have cost the utility $96 million, officials of SCE's parent, Edison International, said during an earnings call.

Power to replace lost output from the 2,150-megawatt plant has cost an additional $221 million, SCE officials said.

Last month, SCE submitted a plan to the Nuclear Regulatory Commission to restart San Onofre Unit 2 and operate it at 70 percent of capacity for an initial 5-month period, at which point it would halt production and look for signs of the premature tube-to-tube wear that led to the January leak in Unit 3.

Edison Chief Executive Ted Craver said it was unclear if and when the regulator might allow SCE to move forward with its plan or whether the plant would ever come back online fully.

"It's not clear at this time whether the units can be repaired, and it appears complete replacement of the steam generators would take some years," Craver said.

In an attempt to recoup some costs related to San Onofre, SCE in September submitted a $45 million invoice to Japan's Mitsubishi Heavy Industries Ltd, which manufactured the steam generators.

SCE has a 20-year warranty with Mitsubishi for the steam generators, and officials said they plan to send additional invoices to the company down the road.

Last month, the company also submitted an initial claim to Nuclear Electric Insurance Ltd, an industry-sponsored fund, for loss recovery under its outage insurance.

"We will remain diligent in recovering costs incurred from the outage from warranties and insurance," Craver said.

Still, officials said there was no guarantee the utility would recover money from either the warranty or the insurance company.

Edison International reported third-quarter 2012 net earnings of $190 million, or 58 cents a share, down from the $426 million, or $1.31 per share, reported in 2011.

The utility unit reported earnings of $1.11 per share in the quarter ended September 30, down from $1.25 per share a year ago.

San Onofre, the biggest power plant in Southern California, is 78 percent-owned by Southern California Edison. The remainder is held by the city of Riverside and San Diego Gas & Electric, a unit of Sempra Energy.

(Editing by Eileen O'Grady and Joseph Radford)