Four years after an alleged mismanaged forced outage of the Diablo Canyon Power Plant, the California Public Utilities Commission ordered Pacific Gas and Electric (PG&E) to return $43.2 million in replacement power costs paid by ratepayers.
“The first disallowance is for forced outage four at Diablo Canyon Nuclear Power Plant, which PG&E failed to prevent by failing to manage vibrations from the Unit 2 generator,” the commission said in its June 26 decision.
The aging Diablo Canyon’s second unit has a history of vibrations. With $130 million from the commission, PG&E replaced the main generator in the unit in 2019.
Six forced outages took place over the next two years. While the commission believed PG&E acted “prudently” during five of them, it stated that the fourth outage that occurred from Feb. 2 to March 1, 2021, happened because of inadequate testing.
After three forced outages, both PG&E and Siemens—the successor to Westinghouse, which constructed Diablo Canyon, contracted by the utility—reportedly didn’t properly inspect building bolts and test for modal frequency. That’s the natural frequency at which Diablo Canyon’s Unit 2 generator will vibrate when disturbed.
“It was only after the testing during forced outage four that PG&E ameliorated the causes of the excess vibrations and high frequencies,” the commission said. “During outage four, PG&E installed additional vibration sensors and conducted material analysis to prevent additional outages resulting from the same cause.”
PG&E spokesperson Carina Corral told New Times in a prepared statement that the utility is disappointed by the commission’s decision.
“We are confident we have taken the right steps to ensure safe and reliable operation of Diablo Canyon to support overall grid reliability and provide electricity to 4 million Californians,” she said in a prepared statement.
But PG&E customers won’t see the $43.2 million reimbursement immediately.
Corral said that using shareholder funds, the money will be folded into PG&E’s 2026 rates in January—this means customers won’t receive a check in the mail or see the reimbursement as a line item on their bills. Customer rates will depend on each person’s specific electricity usage.
Corral added that PG&E proactively takes steps to ensure long-term safety at Diablo Canyon by monitoring operations after work is performed.
“The federal Nuclear Regulatory Commission (NRC) continually inspects and certifies the facility, ensuring it is operating to the highest safety standards,” Corral said. “Time and time again, these inspectors have determined that the plant is safe to operate, and the NRC’s assessments have placed it among the highest performing plants in the nation.”
The commission’s decision noted that PG&E attributed the first four forced outages to bore rings loosened by vibrations from the generator. Described as a latent defect, PG&E claimed that it couldn’t have detected the problem through on-site supervision.
The fifth forced outage was a result of incorrect installation of two hoses inside the Unit 2 main generator. Siemens faced staffing issues when fixing the problem because the outage took place a month into the COVID-19 shelter in place orders.
The sixth forced outage went undisputed and was caused by a malfunctioning feedwater heater tube. It was unrelated to the Unit 2 generator, according to the commission decision.
Watchdog group Alliance for Nuclear Responsibility (A4NR) believes that PG&E should be held responsible for the first three outages that took place over 2020-21.
“A4NR does not contest the actions PG&E took after the vibrations shut down the Unit 2 generator but urges the commission to reject PG&E’s assertion that it could not have anticipated the vibrations,” the decision said.
A4NR Executive Director David Weisman told New Times that during 2020-21, the failure of the replacement generator in Unit 2 led to 149 days of unplanned outages.
“During that half a year, PG&E had to buy replacement power from some other vendor to make up the loss of power from Diablo,” he said. “They wanted to charge the ratepayers for that. We then stepped in and said, ‘We think you messed this up and we shouldn’t be on the hook for it.'”
But Weisman’s primary worry is Senate Bill 846—the state legislation that details extending Diablo Canyon’s life beyond its 2025 expiration date—allowing PG&E to charge ratepayers up to $300 million for accidents related to keeping the plant open.
According to the bill, customers pay $12.5 million for each of the two Diablo Canyon units into the Diablo Canyon extended operations liquidated damages balancing account every month until it reaches $300 million.
Customers will pay into that balancing account again if PG&E taps into that money to cover mishaps like future unplanned power outages at Diablo Canyon. Since SB 846 was signed into law in 2022, PG&E can’t use the account money for the 2021 outages.
Weisman criticized state Sen. John Laird (D-Santa Cruz) for supporting the legislation.
“If you care about ratepayers, if you care about affordability, how do you build a $300 million get-out-of-jail-free card into this?” he said.
Laird told New Times that he believes some items in SB 846 have not been “satisfactorily addressed.”
He pointed to the taxpayer and ratepayer burdens stemming from the $300 million loaned to PG&E, the pending results of the embrittlement tests on the Unit 1 reactor, and PG&E’s incomplete application to the California Coastal Commission for the extension of operations.
“I will continue to press for the full implementation of SB 846 and a satisfactory outcome to these issues, which protects the state’s energy supply, the safety of the plant operations for employees and Central Coast residents, the coastal land and wildlife that surrounds the plant,” Laird said, “as well as fiscal protections for California ratepayers and taxpayers, and the county of San Luis Obispo.” Δ
Reach Staff Writer Bulbul Rajagopal at brajagopal@newtimesslo.com.
This article appears in Jul 31 – Aug 10, 2025.