The U.S. Department of Energy (DOE) on Nov. 21 announced the conditional selection of the Diablo Canyon nuclear power plant in California to receive the first round of funding from the Civil Nuclear Credit (CNC) Program.
Units 1 and 2 at the Diablo Canyon Power Plant (DCPP) were scheduled to be decommissioned in 2024 and 2025, but the conditional award of credits, valued at up to $1.1 billion, creates a path forward for Diablo Canyon to remain open. Final terms are subject to negotiation and finalization by DOE.
Funded by President Biden’s Infrastructure Law, the $6 billion CNC program aims to help preserve the existing U.S. nuclear reactor fleet.
DOE noted that shifting energy markets and other economic factors have resulted in the early closures of 13 commercial reactors across the United States since 2013.
Owned and operated by Pacific Gas and Electric Company (PG&E), Diablo Canyon produces approximately 16 GWh of electricity annually.
PG&E filed its application for federal funding on September 2, 2022, the same day California Governor Gavin Newsom signed Senate Bill 846 into law, seeking to extend operations at DCPP in San Luis Obispo County for five years beyond its current license expiration in 2025.
Last month, the state authorized a loan of up to $1.4 billion from the Department of Water Resources to PG&E to support extending operations at the plant. SB 846 further directed PG&E to pursue funds from DOE, and any other potentially available federal funds, to pay back the loan and lower costs for customers should the plant’s operating license be extended.
DOE said that the first CNC award cycle prioritized reactors facing the most imminent threat of closure, limiting applications to reactors that had already announced intentions to cease operations due to economic factors.
The second CNC award cycle will prioritize reactors that are projected to shut down due to economic factors within the next four years.
DOE is expected to begin accepting applications for the second cycle of CNC funding in January 2023.
Click here for additional details about the CNC Program and the upcoming second award cycle.