This chapter shall be known and may be cited as the Nuclear Facility Decommissioning Act of 1985.
Chapter 2Decommissioning of Nuclear Facilities
Section § 8321
This law is officially called the Nuclear Facility Decommissioning Act of 1985. It governs how nuclear facilities in the state are safely closed and dismantled.
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Section § 8322
This law highlights the importance of protecting Californians from radiation exposure from nuclear facilities and ensuring fair electricity pricing. The state aims to distribute the costs of nuclear-generated electricity fairly among all customers and reduce those costs while maintaining public health and safety. Decommissioning of these facilities introduces financial risks, so California wants to ensure the necessary funds are available when needed with equitable cost distribution among customers and investors. Moreover, employees losing jobs due to decommissioning deserve reasonable job protection, included in decommissioning costs.
The Legislature hereby finds and declares all of the following:
(a)CA Public Utilities Code § 8322(a) The citizens of California should be protected from exposure to radiation from nuclear facilities.
(b)CA Public Utilities Code § 8322(b) It is in the best interests of all citizens of California that the costs of electricity generated by nuclear facilities be fairly distributed among present and future California electric customers so that customers are charged only for costs that are reasonably and prudently incurred.
(c)CA Public Utilities Code § 8322(c) The costs of electricity generated by nuclear facilities, including the costs of their decontamination and decommissioning, should be reduced to the lowest level consistent with public health and safety.
(d)CA Public Utilities Code § 8322(d) The ultimate costs of the decommissioning of nuclear facilities are of significant magnitude, and introduce an element of financial risk to both electric customers and investors unless prudent provision is made for defraying those costs.
(e)CA Public Utilities Code § 8322(e) In order to reduce both risk and ultimate costs for all of its citizens, the State of California should establish a comprehensive framework for timely payment of the costs of decommissioning, and provide for allocation of risks and costs among the respective interests.
(f)CA Public Utilities Code § 8322(f) The principal considerations in establishing a state policy respecting the economic aspects of decommissioning are as follows:
(1)CA Public Utilities Code § 8322(f)(1) Assuring that the funds required for decommissioning are available at the time and in the amount required for protection of the public.
(2)CA Public Utilities Code § 8322(f)(2) Minimizing the cost to electric customers of an acceptable level of assurance.
(3)CA Public Utilities Code § 8322(f)(3) Structuring payments for decommissioning so that electric customers and investors are treated equitably over time so that customers are charged only for costs that are reasonably and prudently incurred.
(g)CA Public Utilities Code § 8322(g) Decommissioning nuclear facilities causes electric utility employees to become unemployed through no fault of their own, and these employees are entitled to reasonable job protection the costs of which are properly includable in the costs of decommissioning.
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Section § 8323
The main goal of this law is to protect electric customers from unreasonable costs related to nuclear power plants. It requires the responsible commission or board to create rules that ensure realistic cost estimates, regularly review these estimates to encourage accuracy, and control decommissioning expenses.
It is the intent of the Legislature in enacting this chapter to protect electric customers, both present and future, from the risks of unreasonable costs associated with ownership and operation of nuclear powerplants. To that end, the commission or board with respect to each electric utility owning or operating a nuclear powerplant, shall develop regulations and guidelines that promote realism in estimating costs, provide periodic review procedures that create maximum incentives for accurate cost estimations, and provide for decommissioning cost controls.
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Section § 8324
This section explains the meanings of certain terms used throughout the chapter related to nuclear power plants operated by public utilities. The 'Board' refers to the directors of a public utility owning or operating a nuclear power plant. The 'Commission' means the Public Utilities Commission. An 'electrical utility' covers both privately and publicly owned utilities managing nuclear facilities for electricity generation. 'Decommissioning' is taking nuclear facilities out of service safely and making them safe for unrestricted use. 'Nuclear facilities' include all parts of a licensed nuclear activity site.
Unless the context otherwise requires, the definitions in this section govern the construction of this chapter.
(a)CA Public Utilities Code § 8324(a) “Board” means the board of directors or other governing body of a publicly owned public utility owning or operating a nuclear power plant.
(b)CA Public Utilities Code § 8324(b) “Commission” means the Public Utilities Commission.
(c)CA Public Utilities Code § 8324(c) “Electrical utility” includes both an electrical corporation subject to the jurisdiction and control of the commission and a publicly owned public utility subject to the jurisdiction and control of its board, in either case owning or operating nuclear facilities for the generation of electricity.
(d)CA Public Utilities Code § 8324(d) “Decommissioning” means to remove nuclear facilities safely from service and to reduce residual radioactivity to a level that permits release of the property for unrestricted use and termination of license, or as otherwise defined by the Nuclear Regulatory Commission or its successor. Decommissioning includes other activities and costs, if any, which may be included in Internal Revenue Service regulations implementing Section 468A of the United States Internal Revenue Code.
(e)CA Public Utilities Code § 8324(e) “Nuclear facilities” means the site, building and contents, and equipment associated with any activity licensed by the Nuclear Regulatory Commission, or as may be otherwise defined by the Nuclear Regulatory Commission or its successor.
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Section § 8325
This law requires electric companies operating nuclear plants, whether in California or elsewhere, to set up a special fund managed by an outside party. This fund, meant to cover costs of closing and cleaning up nuclear sites, should qualify for a tax deduction under the IRS code if it's beneficial for the customers. The commission is tasked with allowing these companies to charge enough in utility rates to make maximum tax-deductible contributions to this fund and cover decommissioning expenses. Even publicly owned utilities must set up a similar fund, with their board ensuring costs are recovered through customer electric rates.
(a)CA Public Utilities Code § 8325(a) Each electrical corporation owning, in whole or in part, or operating nuclear facilities, located in California or elsewhere, shall establish an externally managed, segregated fund for the purposes of this chapter. In addition, each electrical corporation may establish other funds, as appropriate, for payment of decommissioning costs of nuclear facilities.
(b)CA Public Utilities Code § 8325(b) The externally managed, segregated fund established pursuant to subdivision (a) shall be a fund which qualifies for a tax deduction pursuant to Section 468A of the United States Internal Revenue Code, and applicable regulations of the Internal Revenue Service adopted pursuant thereto, if that tax treatment is determined by the commission to be in the best long-term interests of the customers of the electrical utility.
(c)CA Public Utilities Code § 8325(c) The commission shall authorize an electrical corporation to collect sufficient revenues in rates to make the maximum contributions to the fund established pursuant to Section 468A of the United States Internal Revenue Code and applicable regulations, that are deductible for federal and state income tax purposes, and to otherwise recover the revenue requirements associated with reasonable and prudent decommissioning costs of the nuclear facilities for purposes of making contributions into other funds established pursuant to subdivision (a).
(d)CA Public Utilities Code § 8325(d) Notwithstanding any other provision of this section, an electrical utility, which is a publicly owned public utility subject to the jurisdiction and control of its board, shall establish and may manage a separate fund for purposes of this chapter. The board shall provide that the amounts of all payments into this fund are recoverable through the utility’s electric rates.
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Section § 8326
This law requires all electrical utilities that own or operate nuclear facilities, whether in California or elsewhere, to give an estimate of the cost to shut down (or 'decommission') these facilities to the relevant authorities. The estimate must include not only the costs but also how changes in regulations, technology, and economics might affect these costs. Additionally, they must detail any changes to their nuclear facilities and provide any other necessary information as requested by authorities.
The cost estimates need to be updated periodically according to specific guidelines set by the commission or the board to ensure they remain accurate over time.
(a)CA Public Utilities Code § 8326(a) Each electrical utility owning, in whole or in part, or operating a nuclear facility, located in California or elsewhere, shall provide a decommissioning cost estimate to the commission or the board for all nuclear facilities which shall include all of the following:
(1)CA Public Utilities Code § 8326(a)(1) An estimate of costs of decommissioning.
(2)CA Public Utilities Code § 8326(a)(2) A description of changes in regulation, technology, and economics affecting the estimate of costs.
(3)CA Public Utilities Code § 8326(a)(3) A description of additions and deletions to nuclear facilities.
(4)CA Public Utilities Code § 8326(a)(4) Upon request of the commission or the board, other information required by the Nuclear Regulatory Commission regarding decommissioning costs.
(b)CA Public Utilities Code § 8326(b) The decommissioning costs estimate study shall be periodically revised in accordance with procedures adopted by the commission or the board pursuant to Section 8327.
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Section § 8327
This law requires the commission or board to review how much it will cost to shut down an electrical utility, especially during any official meetings about changing electricity rates. They must consider recent changes in technology, regulations, and the economy, as well as how the nuclear facilities have been operating. The review should include all estimates of costs, the reasons behind them, and any assumptions made about how long the nuclear facilities will last.
The commission or the board shall review, in conjunction with each proceeding of the electrical utility held for the purpose of considering changes in electrical rates or charges, the decommissioning costs estimate for the electrical utility in order to ensure that the estimate takes account of the changes in the technology and regulation of decommissioning, the operating experience of each nuclear facility, and the changes in the general economy. The review shall specifically include all cost estimates, the basis for the cost estimates, and all assumptions about the remaining useful life of the nuclear facilities.
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Section § 8328
This law states that money set aside specifically for shutting down nuclear facilities should cover the costs. If there's not enough money, a regulatory body will check if the extra costs are justified and wisely spent. If they are, these additional costs can be passed on to the electric company's customers.
The expenses associated with decommissioning of nuclear facilities shall be paid from the funds established pursuant to Section 8325. If the money in the funds is insufficient for payment of all decommissioning costs, the commission or the board shall determine whether the costs incurred in excess of the money in the funds are reasonable in amount and prudently incurred. If the commission or the board determines that the excess costs are reasonable in amount and prudently incurred, the commission or the board shall authorize these costs to be charged to the customers of the electric utility.
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Section § 8329
This law says that when setting rates or charges, the commission or board must review and approve the estimated service life and retirement date of nuclear facilities.
The commission or the board shall, for purposes of establishing rates or charges, review and approve the estimated service life and estimated retirement date of all nuclear facilities.
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Section § 8330
This law requires electrical utilities that are shutting down nuclear facilities to help their employees find similar jobs if they become unemployed due to the facility's closure. The law also allows these utilities to recoup any costs linked to this assistance by raising electric rates and charges.
Every electrical utility involved in decommissioning, closure, or removal of nuclear facilities, shall provide assistance in finding comparable alternative employment opportunities for its employees who become unemployed as the result of decommissioning, closure, or removal. The commission or the board shall authorize the electrical utility to collect sufficient revenue through electric rates and charges to recover the cost, if any, of compliance with this section.
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