The U.S. Department of Energy on Jan. 17 announced the signing of a credit award and payment agreement with California-based Pacific Gas and Electric Company to finalize terms for $1.1 billion in credit payments via the Civil Nuclear Credit Program for the Diablo Canyon Power Plant.
Administered by DOE’s Grid Deployment Office, the $6 billion CNC program supports the continued operations of safe and reliable nuclear energy facilities, DOE noted.
Diablo Canyon generates 2,200 megawatts of baseline electricity,
In November 2022, DOE announced the conditional selection of Diablo Canyon Power Plant for CNC credits. The Jan. 17 announcement marks the finalization of the award.
The total award of CNC credits is capped at $1.1 billion. The credits are slated to be paid in installments for a four-year period of performance from 2023 through 2026, with the amount of the annual payment to be adjusted based on a number of factors, including actual costs incurred to extend the operation of the Diablo Canyon Power Plant.
The first payment of awards is scheduled for 2025 based on the operation of the Diablo Canyon Power Plant in 2023 and 2024.
Units 1 and 2 at the Diablo Canyon Power Plant, which provide 9% of the total California power generation, were scheduled to cease commercial operation in 2024 and 2025, but the agreement announced Jan. 17 supports a path forward for Diablo Canyon to continue operating.
While nuclear power currently provides nearly 50% of the nation’s carbon-free electricity, shifting energy markets and other economic factors have resulted in the early closures of 13 commercial reactors across the United States since 2012, DOE noted.
In December 2023, the California Public Utilities Commission voted to conditionally allow PG&E to extend operations at the Diablo Canyon Nuclear Power Plant.