ML17083A340

Responds to Re Wh Mcdill Comments on NRC Handling of TMI-2 Accident & Delays in Nuclear Plant Licensing.Nrc Reorganized to Provide More Emphasis on Mgt Matters Identified by post-TMI Accident Investigations

ML17083A340
Person / Time
Site:	Diablo Canyon
Issue date:	04/29/1980
From:	Dircks W NRC OFFICE OF THE EXECUTIVE DIRECTOR FOR OPERATIONS (EDO)
To:	Lagomarsino R HOUSE OF REP.
Shared Package
ML16340A957	List: ML17083A340
References
FOIA-80-274 NUDOCS 8005130238
Download: ML17083A340 (36)

Text

EDO Reading B. Boore LWR 1 File

.J. Stolz W. Dircks B. Buckley The Honorable Robert 'a. Lagomarsino H. Denton E. Hylton United States House of Representatives Washington, D. C.

20515 D. Ross H. Shapar D. Vassallo H. Berkow Dear Congressman Lagomar sino:

W. Russell ELD D. Muller I am pleased to respond to your March 5,R& referral of a letter to Comissfoner Hendrie from your constituent Hr. William H. HcDill.

Since rulings and decisions related to the Diablo Canyon Nuclear Power Plant could be subject to the review by the Commission, it would be inappropriate for a Corrmissioner to cogent on your constituent's concerns at this time.

Therefore, your letter was referred to me for reply.

n Your constituent expressed his dissatisfaction regarding the way the Nuclear Regulatory Commission (NRC) hand'led the Three Nile Island accident and the Commission's delays in the licensing of nuclear power plants.

He also enclosed copies of. newspaper clippings regarding the Atomic Safety and Licensing Appeal Board (ASLAB) review of intervenors appeals on seismic and security issues and statements from a coalition of San Luis Obispo County anti-nuclear groups critical of emergency preparedness plans under consid-eration for the Diablo Canyon plant.

The concern expressed regarding the NRC has been aalso described in the Report of the President's Commission on the Accident at Three Nile Island (the Kemeny Report),

and in the report prepared for the Commissioners by the NRC Special Inquiry Group (the Rogovin Report).

The NRC, in the year following the-Three Nile Island accident.

has devoted a major part of its resources to eva'lu)ting what happened and applying the "lessons learned" to improving nuclear plant safety.

Among the actions taken to improve the way the NRC does its job, the Office of Nuclear Reactor Regulation has been recently reorganized to provide more emlphasis on management matters ident-ified by the various Three flile Island accident investigations.

The new organization provides special emphasis on human factors in safety and an interdisciplinary systems approach to licensing reviews, operating problems and generic issues.

D. Eisenhut R. Hattson J.

Cook S.

Varga The post-Three Nile Island efforts within the NRC and industry had a signif-icant impact on the licensing of nuclear plants.

However, licensing priority has been assigned to four plants, including Diablo Canyon Unit 1, where construction is essentially completed.

Our evaluation of the plant for the results of the "lessons learned" from Three Nile Island and for a license that would allow low-power testing is nearing completion and will be documented in a safety evaluation report.

Helen our.safety evaluation report is issued, the Atomic Safety and Licensing Board must rule on a motion before it which seeks to reopen the, public hearings on Three MIIe Island Issues' Z

E Q'oe ~l Z>~~Ppg Distr Ibutdon p 9y-9 IIIIIIIWTIIIIIIIIfllI

~kl B.

K t (08534)

NRC PDR H. Groff APR 2S 1859 Local PDR SECY (80-0445)

NRR Reading E. Hughes OFFICEy SORNAME OATEN NRC FORM 318 {9'761 NRCM 0240

~,

s ~

AU.S. GOVERNMENT PAINTING OFFICE: 1979 289 369

/v r%

~

~

I 1

1 1

I r

~ ~

Ap I~

I, I

~

~

c 1

f <<" >>

1 >>1 tylr V

~

5 4

1 Vf v

1 V

/c 1

c 1 N

'I r

f I

f; I

rt ~ I

,I

~

CI F.

c, 1

F VL 1

~

I I

1 I I'

11

~

~

I 1

1 vc

The Honorable Robert J.

Lagomarsino The app als on seismic and security matters, matters which were previously reviewed and approved by the Licensing Board, are still pending before the ASLAB.

A prehearing conference on the security matter and oral argument on the seismic matter were conducted during, the first week of April 1980.

The staff has not changed its previous favorable conclusions regarding these matters.

Regarding emergency preparedness plans, the staff has held public meetings on this subject in the area near the Diablo Canyon Plant.

Before licensing of Diablo Canyon, these plans must meet the up'graded requirements which include evaluation by the NRC in conjunction with the Federal Emergency management Agency (FEHA) of State and local emergency response plans and preparedness for all elements of off-site radiological emergencies.

One of six NRC teams has been assigned to the Diablo Canyon site to make this

~

assessment.

Longer term actions in coordination with FEttA involve the testing of the state of preparedness at the nuclear site by integrated emergency drills and exercises involving the licensees and State, local and Federal agencies.

I want to assure you that we fully appreciate your constituent's coments and trust that the above information has been responsive to his concerns.

Sincerely, gpe%+

,(yggeQ ~.

William J.

Dircks Acting Executive Director for Operations SEE PREVIOUS YELLOW FOR CONCURRENCES LlJR 1

"EHy'1 ton" " '

"BBuekley/rs" JStolz 4/21/

OFFICE j~)

SURNAt:.E[)

OA Ef NR FORt.') 6 (9 76) NRCt,t 02CO EDO HJDircks OCA 0 4/

/80 4/

/80 Ou.S. GOVERNMENT PRINTINC DFI i E:.:

0 J+

"v$

~ I s t ~

~ $

The Honorable Robert J Lagomarsfnoi The appeals on seismic and'security patters, matters which were previously reviewed and approved by the Lfcensfhg Board, are still pending before the ASLAB.

A prehearing conference on t(

the seismic matter were conducted durt staff has not changed fts previous f matters.

Pegardfng emerg cy preparedness pla on this subject f the area near the of Diablo Canyon, th se plans'ust evaluation by the NRC~fn conjunction Agency (FEtS) of a progr m for asse s

e security matter and oral argument on ing the first week of April 1980.

The vorable conclusions regarding these s, the staff has held public meetings Dfab'1o Canyon plant.

Before licensing et the upgraded requirements which include with the Federal Emergency Hanagement fng State and local emergency response plans for a11 elements o

ff-site padfologfcal emergencies.

One of six NRC teams has been assigned to ge Dfab o Canyon site to make this assessment.

Longer term actions in coordfqatio with FERA involve the testing of the state of preparedness at the nb le r site by integrated emer gency drills and exercises involving the licensee and State, local and,.Federal agencies.

trust that tbe above Infornatio ~has een responsive to'his concerns.

fncerely, I want to assure you that we ful y precfate your constituent's cone.ents and

, William J. Dircks Acting E ecutfve Director SEE PREVIOUS YELLOW FOR CONCURRENCES* -

REWRITTEN PER OELD Lt(R SVar ga*

4/10/80 4/

/80 OFFICE)

SURNAME

~

OATE)

Ll(R 1 EHylton ""'"

BBuckley/rs "

JStolz

~ -

DP>1 "".

" DRoss""

". 4/17/80

~ NRR" ".'

NRR".-- ".

"EGCase "" "HBenton""

"4/" /80" "4/" /80 ""-

EDO" "

WDfrcks 4/" /80 OCA 4 " 80"".

NRC FORM 318 (9.76) NRCM 0240

• U.S, GOVERNhtiENT PRINTING OFFICE: 1979 289-369

~ l 4l

]

'I r

+ ~ pr I

l r q I

qn 1

8 5;hn:-

~o~-.

ljii15 $ 9 j~g

. fp )-

OMj:5 gÃhVug~ ~ S.'j >ice 0>" h

~(k cg Dir ctor Huclear Regulatory Commission VFashington, D. C.

3057 S. Higuera St.

Sp,.cd 116 San Iuis Obispo, CA 93401 Dear Sir'.

I would like to plead with you not to give Pacific Gas and Eleotric the permission they asked for yesterday to start operating their Diablo Canyon Nuclear Plant without their final license.

In the first place this would be a dangero~precedent.

More important, I do not believe that any licenses should be granted until the Three Mile Island Report has shown all the requirements necessary for more safety in nuclear plants'n the case of Diablo Canyon I do not feel that all oonditions of danger have yet been taken into consideration.

Vie moved here a

month ago; just'a few days ago I saw pictures of the plant for the first time ~

Knowing the history of slides and slumping along the coast of'outhern California I was horified to see how close to the beach cliffs it is located as well as being close to a small canyon perpendicular to the shoreline.

Obviously some of the cliff~

~~as been disturbed also for one of the smaller structures' had meant to look up the apology of this particular area before writing but P.G.LE 's action does not give me time.

I'm sure that you can get the information from the U. ST Geological Survey.

If';there is the same sandstone, siltstone and shale underneath these buildings that there is under most of the coastal area, then 4he danger of this plant sliding towards or into the ocean with the aocompanying disaster if the plant is in operation is far greater than the danger from an earthquake.

I plan to write again after I have looked into this matter further.

I am ags inst any nuclear plant at least until a satisfactory method of waste disposal fis found; but I am particularly against them in California.

California is in a unique situation found no place else in the world today.

Perhaps there ha riever been one like it.

It is located on the leading edge of a continental plate which is overriding a mid-ocean ridge of molten rock'coming up from great depths one side of which is trying to push California back to the east.

Geologists do not know what 'is going to happen but knmv that this is the reason for the tremendous number of faults.

I have not seen either of these matters brought up in discussionf of the safety of Diable Canyon Kuclear plant and feel strongly that they should be before a licensing decision is made

~

cc:

Gov. Jerry Brown Connie Snapp

t 1

'PROD SL UTILFAC ~

March 10, 1980 Mr. John Ahearne, Chairman U.S. Nuclear Regulatory Commission Washington, D.C.

20555 DOCK i -"D USNRG 9

MAR 1 5 1980>

12 Office of the Secrefafnt DfjcMrtf,ffl8@Ra Sr~ad h

Dear Mr. Ahearne:

I am writing to urge the licensing of Nuclear Power Plants, particularly those ready or near ready for oper-ation.

The most urgent need is for Diablo Canyon.

Calif-ornia is particularly short of power reserves thanks to your delays and. those of the State Energy Commission.

Power reserves last summer in California were below 5%

which is just too slim a margin to assure reliable energy.

Please act.

Very truly yours, C

Oscar D.

errell 6477 Camelia Drive San Jose, CA 95120 cc'enator S.

Z. Hayakawa Representative Mineta Govenor-Jerry Brown San Jose Mercury News

r.!~Id 0

, ~

( >Saon 1

f eq Sector icL 4! SerdC~

ch DOCKET HUE>(ER Ir i,III,.rIIIIrg Qrah Q4 e the undersigned, as citizens of the State of CaZifornia and tepayers of the Pacific Gas and Electric Company, believe that the cZear Regulatory Commission and P.G.8 Z. should not allov the Diablo nyon. !Vuclear Pover PZant, in San Luis Obispo County, to go into Oper-ion.

1/ucZear Pover is one of the most dangerous technologies knovn..

r

.i5 poses a grave risk to our health and safety, is a mqoor contri-ting factor in the spread of nuclear veapons, it is a threat to our vil Ziberties, and an economically unviable vay of generating elec-icity. DiabZo Canyon is in violation of the spirit of the California clear Safeguards Lave regarding the safe disposaZ of'uclear'aste.

NAME ADDRESS CITY ZIP t.'Please Print Clearly)

( wf I

~

ri

~

r

~ ~

I /

I

( ~;/c 2 r./".!

.;...Ve the undersigned, as citizens of'he State of CaEif'ornia and ratepayezs of the Pacific Gas and EZectric Company, believe that the 1'lucZear Regulatory Commission and P.G.8 Z. shouEd not allot the Diablo Canyon Nuclear Poorer PZant,. in San Luis Obispo County, to go into Opez-ati'on.

Nuclear Potuer is one of the most dangerous technologies knon)n..

I

...it. poses a grave risk to our heaEth and safety, is a mqgor contri-buting. factoz in the spz cad of nuclear weapons, it is a thz eat to ouz'iviE Ziberties, and an economica"EZy unviable say of generating elec-tz'icity ~ Diablo Canyon. is in vioEation of the spirit of'he California Vuclear Safeguards Lairs regarding the saf'e disposal of nucleaz'uaste.

NAME ADDRESS CITY ZIP (Please Print Clearly) o3 9'

.;... Ve the undersigned, as citizens of'he State of'alifoznia and ratepayers of the Pacific Gas and Electric Company, believe that the NucZeaz Regulatory Commission and P.G.8 Z. should not allot the DiabZo Canyon Nuclear Potoer Plant, in San Tuis Obispo County, to go into Oper-ation.

Nuclear Pover is one of the most dangerous technologies known..

...it poses a grave risk to ouz heaZth and safety, is a moor contri-buting factor in the spz ead of nuclear weapons, it is a thz'eat to our I

civil Ziberties, and an economically unviable way of generating elec-tzicity. Diablo Canyon is in violation of the spirit of the California NucZear Safeguards Sans regarding the saf'e disposaZ of'uclear'oaste,

\\

NAME ZIP ADDRESS CITY (Please Print Clearly) 2 c-.s C ~ ~Ivy Cu.c~.~'~P II l+

,)-

Co,c,:ry

/<,rS'l~

'7l(.J" C~

g.,~

Al(c k A ~ui,~w 2<53 cvnm D~dP~~ i<f7~>

0 4

(~~

tdghc'ace

?Y2, 7

O'. Dr4lc

<'/7(o

,2

.i Y c r 5/Ci>

10

.'...Ve the undersigned, as citizens of the State of California and ratepayers of the Pacific Gas and EZectric

Company, beZieve that the Nuclear Regulatory Commission and P.G. 8 Z. shouZd not allot'he Diablo Canyon 11uclear Pover Plant~ in San Luis Obispo County, to go into Oper-ation.

Nuclear Pover is one of the most dangerous technologies knon)n..

...it poses a grave risk to our heaZth and safety, is a mqgor contri-buting factor in the, spread of nucleaz weapons, it is a threat to our civil liberties, and an economica'Zly unviab Ze ray of generating e Zec-tricity~ Diablo Canyon is in vio'lation of the spirit of the California lFucZear Saf'eguards Lave regarding th'e safe disposaZ of nuclear'asts.

ZIP r ~

Bc'e4n-e ~ l. 7 g~ ~q'-

+<a!{.

3 c intr 4~MCI~<<r<<a<<<<nt-t

<< 1(

.~i<C!rt(I E.'

7 zt p <<<<<<; <<<<<<

I; Fi ~J

$4CF Z 1~ (

NAME ADDRESS CITY I

{Please Print. Clearly) j l.i'

'{,~~ ~

0 W~'+I,F LF V W I ({IV C/1'-7 r

10

) I

'cl,l w(r C/gQ

0

...8'e the undersigned, as citizens of'he State of California and

tepayers of the Paci f'ic Gas and "Electric Company, believe that the

.clear ReguZatory Commission and P.G.8 Z. should not alZov the Diablo

.nyon Nuclear Pover Plant, 'in San Luis Obispo County, to go intro Opez-ion. l7uclear Pover is one of the most dangerous technologies knovn..

II

.it poses a gzave risk to our heaZth and safety, is a major" contri-r

'.ting f'actor-in the sprea'd of nuclear veapons, it is a threat to ouz

'vil Zibertiea, and an economically unviabZe vay of generating elec-icity. DiabZo Canyon is in violation of'he spirit of'he Calif'oznia

clear Saf'eguaz da. Lava regarding the aaf'e disposaZ of'uclear'aste.

ADDRESS CITY ZIP (Please Print Clearly)

C I ~~ S-,~.--

Cc>4~ L lf

. 4 I)

J 8%Zllr Pa,~)

Q g 9

1 9-6a~5 Cab A~

I c.

)aj/)'ia r

,;...Ve the undersigned, as citizens of the State of'aZifornia and ratepayers of the Pacific Gas and Electric Company, believe that the NucZear ReguZatory Commission and P.G.8 E. should not allot'he DiabZo Canyon Nuclear Poser Plant, in San luis Obispo County, to go into Oper-ation.

Nuclear Pobler is one P

...it poses a

gz ave z isk to buting factoz in the spread of'he moat dangerous technologies known.'".'"

our health and safety, is a mq'J'or contri-I/

of nuclear weapons,', it is a threat to our civil libertiea, and an econom>c<<Zy unviable ruay of'enerating elec-tricity~ Diablo Canyon is in violation of the spizit of the Calif'ornia Nuclear Safeguards Lan)a regaz ding the safe disposaZ of nuclear'taste.

NNAME 'DDRESS CITY 2',IP (Please: Print Clearly) r/~ ~Su 2 ~

/,.

J

~

I r~+)

(pPgg 4

(~+. /

"i

. ig

~I'Q~

/r' 08zg

8 Ri'w i ~/-

0

....,Ve the undersigned, as citisens of'he State of G'alif'oznia and ratepayers of the Pacific Gas and Zlectric Company, believe that the r

h Nuclear Regulatory Commission and P.G.8 Z. should not allov the Diablo C'anyon Nuclear Poorer Plant," in San Euis Obispo G'ountp,

.to go'nto Oper-

ation, Nuclear Pover is one of'he most dangerous technologies known,.

I

...it poses a gree zisk to ouz health and safety, is a moor contzi-

~1g buting factor in the spread of'ucleaz weapons, it is a thzeat to ouz civil liberties;. and an economically unviable rap of'enerating elec-tricitp. Diablo G'anyon is in violation of the spirit of the Galif'oznia Nuclear Safeguards Lars regarding the saf'e disposal of nuclear'aste, ADDRESS ClTY (Please Print

./r..X

.~-i.< 6;li,(-

Clear1y}

l.

~'

r.

7 7

.;... Ve the undersigned, as citizens of the State of California and ratepayers of the Paci fic t"as and Zlectric Company, believe that the l'luclear Regulatory Commission and P.G. & Z.. should not allot'he Diablo Canyon IFuclear Pover Plant, in San Luis Obispo County, to go into Opez-r ation. nuclear Pover i's one of the most dangerous technologies known..

...it poses a grave risk to our health and safety, is a mqoor contri-buSing factor in the spread of. nuclear weapons, it is a thz eat to our civil Zibez ties, and an economica'eely unviable

@ay of generating elec-tricity. Diablo Canyon is in violation of the spirit of the Califoznia'uclear Safeguards

'Lasts regarding the safe disposal of nucleaz'aste.

NAME ADDRESS CITY.

ZIP (Please Print Clearly) l r..'C.r.c' wc..

=

. Z~'~&

(

i

~

i (P l

?

,"i..r-. ~.

<i'"

.~~",... ll. "8 ~'i".r, --.rr ~:

r 4

H rr I

12

'D

.Ve the undersigned, as citisens of the State of'alifoznia and

. ratepayers of'he Pacif'ic Gas and Electric Company, believe that the Nuclear Regulatory Commission and'.G. 8 Z. should not allover the Diablo Canyon nuclear Poser Plant, 4g ation'.. lluclear Poser is one

-..;:i:t poses a grave risk to V

1

,.b'uting factor in'the spz ead in San Suis Obispo County, to go into Oper-of the most dangezous technologies known..

our health and safety, is a major contri>>

of nuclear cueapons, it is a thz eat to ouz civil liberties, and an economically unviabZe ray of'enerating sZec-

"'tricity. Diablo Canyon is in violation of the spirit of the California r

Nuclear Safeguaz ds Tan)s regarding the saf'e disposal of'uclear'oasts.

ADDRESS

', CITY (Please Print Clearly)

I 1

I 2

~

'p~~

/~A~-t't~, ~

, ZIP f64 tc ~3 10 15 16

.....Ve the unders" gned, as citi3ens of the State of'aZif'ornia and zatepapers of the Pacific Gas and EZectric

Company, beEieve that the Nuclear Regulatory Commission and P.G. 8 E.

shouZd not allot) the Diablo Canpon Nuclear Power Plant, ation. nuclear Pover is Me

...it poses a grave ziek to buting factoz in the spread in San Luis Obispo County, to go into Oper-A of'he most dangerous technologies known..

our health and safety, is a mqgor contri-df nuclear weapons, it is a thy eat to our civil liberties~

and an. economic'a'EZy unviabEe say of generating eZec-tricity. Diablo Cany'on-is in violation of the spirit of the CaEi f'oznia h

1Fuclear Saf'eguazde Lars regarding the saf'e diepoeaZ of nuclear'aste.

NAME ADDRESS CITY ZIP (Please Print Clearly)

II<(.

~

cv'"IC'KflI:';.I<'>>~ 6

>f.-

IIQ

~i c

r &.K.".~

./'.

'~P~'r C~/ ~.

6'>>

~ / 4/>C< (~.

12 n

STQP BIABI.O'.

F 19ge t5'OCKET HUIyIBER<<<<ll.'D <<<<

Federal Nuclear Regulatory Commission 1990 North-California Boulevard, Suite 202 Walnut Creek, California 94596 8

gg $ Q Duc>>'

I <he Secre~

QNce e, b Sensate Beche'O'Q,h 8<ecch OI D

Dear Commissonerse T- &vie~

4he greatest single danger to'he health and safecy of Californians the imminent opening of the Diablo Canyon nuclear power plant.

The California Energy Commission has shown that

~an nuclear plant presents extreme hazards, because no feasible, long-term solucion has been developed to safely store deadly, radioactive nuclear wastes.

Governor Brown's energy advisor, Wilson Clark, has stated thac California's earthquake-prone geological condicion makes nuclear plants in California an unacceptable risk.

Human beings and the machines they build are all prone co mistakes and accidents.

The recent closing of five nuclear plants on the Ease Coast by the NRC, and the recent accident at the Three Mile Island nuclear plant highlights the risfcs of nuclear plants.

Add to these dangers the risks of earthquakes and we have a completely unacceptable situation.

~lease do evervthin in your ower to ermanentlv sto the o enin of the Diablo Can on facilit.

The health and safety of this and councless fucure generations of Californians depends on it.

We can easily meet our energy needs by rapidly changing over to solar, wind, biomass, and ocher safe, renewable energy technologies.

Since safe energy is available to us, why should we flirtwich ecological diaster by running a nuclear power plant on a fault line.

Elemm~eny Pacific Gas and Electric application for an operating

~lc for rh lr Diablo Da yoo faoiliay.

yka k yo Sincerely, Signature Print Name Lf.e.

n~

16 8%i)f~ %e-5 Masm 'd Address City Seats Zip

'II"HKNKW'AGHK A UUN

%MPH LlVlNGand l1IGH THINKI o

This form letter was prepared by the New Age Caucus.

For more information or addiconal copies, please call 213-820-8182 or write NAC, 11771 Sanca Monica Blvd., LA 90025 P.S.

My personal comments:

Pi ~ +"/

g)in'icGnS<

g(dIy(Q CAN(/oà P q~<f 9eN<<f"t'+A, Y fy ggau.k

C 'c(ET liU;ciDZR E

@ROD 8c UT)LFQC ~

February 27, 19 80 L

~r TO:

interested Persons FROM:

David Roe The enclosed, from the Los An eles Times, is an extensive analysis of utility znancz.a pro

ems, aggravated by commitment to 1arge coal and nuclear power plants.

The potential benefits of alternatives are also discussed.

DBR:jg I"I r

MAR 1 4I~o IRc alp+ g gq SECtetar/

gggggg 5 8ENLCO II~cccch Environmental Defense Fund, 2606 DwightWay, Berkeley, CA94704 (415) 5484906 OFFICES INc NEW YORK, NYINATIONAlHEAGOUARTERSIc WASHINGTON. DCc 8ERKELEY. CA: DENVER Co

Stalled Nuclear Plant: Pt"IM Feels Powerless'

" 14-Year; 81.6 Billion Investinent Is Symliol of Critical Sqtteeze

'on Nation's Electric Utdities:

.'OSAngeles Cltttes ll)mllm PART Vl

~

SWfthy. FENNY24, 1%9 I

fcdrfdfyforIhc'N'a TQcrcirfgIIcene frornrf/''

mach rsfRIIcod.'RIIhrrcbccacsghl fhcscorcdi/fkaR I

fons o! a Nmc rohm nochor potocr has faRm from aoor ond rasny other cfrrfrfdtysoarrrssrnn too erpcn-

. sfor or pogaffon prone, orbed. fhfsfrIhcfoarfhond fin-

dd oriick fo on fafcratfffcnfseries on the e!IrafJo the '

c//orfsfosofosff.

i pnNnn ond Odi/ornkfs potcntidiy path/fadfaif fn

" ByTOMREDBURN Times Staff artier S&N FRhNCISCO-biter mere than 1$ years and $ 1.6 bUUon Invested In Ihe DhMo'Cayon nudcar power olant, Lhere Ir notMng much that crccuUrcs of Padfk fjas &

Efcdrk Co. can do now but walt hnd <<alt.

Era since PG&E acknowlcdfcd, In 1973 Lhe eatrtcnce of a major eatthluake fault dose to the tadgty, DhMo Canyon has been at the center cf controversy. The debate over the plant's safety delayed I~a start-up. Then, h reac-tion to hst Mach's Three N)e Island aoddcnt. the Nu-

'ear Regulatory Commie Imposed a general Ikenslng moratorium on all new nuclear plants. The moratorium wJl cMLInuc, many observers tc/icvc, at least untL~ e/l4 the Norembcr elcdkL TMs <<illdelay eren further a re-

'oluUon of the safety Issue at DtaMo CsnyoL "Every month Ihe cost of Diablo Canyon, from Ihe II-:

nandng charges alone, goes up $10 mligon," saki Stanley Skinner, a PG&E executive vke nrcskknL "lnthe end, our customers wglbe the ones <<ho pay that bUI."

Until Ihe plant Is opcratl, however, PG&E pays Ihe,.

'%4'Nulli, S. '

@p~ ',-.-I+iiC<g-

"." I ".h 'dCtf".f!r6+3.

PPp~',ll'~

vs

.,lcf(..

@ %g,..jp~-

y9 ui~w~h f.gM~j Vj~r bUhL h rdusal by the NRC tofme an operating Ikense for "

'he nuclear fadUty, unlikely as that may be, <<ould plunge 0lgldgmh PG&E Into Ihe greatest cdsls hi pa IN-year Idstory.

I

'b DOC:Rrno if NnflC Mit14 1980'-

OUka of Iha Srntftrf DotkeUsg&genftn Bfmcll fb

~

P ~ t

~ IPk I

~

~

IfPC&8 were forced to mite of!Its enUre Invcstmcnt tn Diablo Canyon overnight, Its common stocLholdcrs'quity of about S33blHion wouldbe slashed by 50%. The compa-ny, according to a PUC staff rcport to the Califoceh Encr-

~ gy Commhsion, would barely generate enough cash to cover Its dividend aud debt paymenls. PC&E would not be able to continue a Ig-year, 820 biHlon censtrucUon pro-gram.

"It would be a case of cxtmne flnanchl cHstrcss," said Ray Cxahr, one of the PubHc UtilitlcsOonunhskm's chief flnandal examiners. "PC&ES only real altcrnaUre wouM be to drastlcaHy reduce Its construcUon program... The ms)or forecasted expenditures for a hrge number of addl-Uonal supply proJects would have to be substanthHy re-duced, If not cHndnatccL over the forecasted period 1030-19RL" PC&E ofI!cals argue, that since state reguhtors ap-proved the phnt back In the late 60s, the only rcaHsUc op-Uon In the even'I Dhblo Canyon never operates would bc to Indude the cost hs ckdrtdty rates spread out over a

.kmg pcdod ofIhnc.

None. of the other chohcs h any less bleak for consu-mers. Eren If PG&E could rapidly buHd two so-caHcd combined cyde plants, designed to nm on oH or natural gas, the price the company'charges for ciectrtdty would stHI Jump substanthHy. hnd Ifthe PUC aHowed the com-cpany to Indude the unusable Diablo Canyon phnt In Its rale base-thus vtoIaUng present yoHcy-prhcs would ht-crcase even more.

The PUC shff csUmatcs that with Dhblo Canyon oper-ating nonnaHy, araage elcdrfdty rata would Increase from about &8cents per kHowatt/hour In 1880 Io65'cents ln IN5. AHowfngPC&8 to charge ustomcrs for the costs of the unusued nudear fadlitywould boost rates to 6 ants pcr kHowatt hour thh year and to 7.8 cents by IN5.

hlthough that dgference seems smalL It translates hto-hundreds of m00ons of dolhrs fn addlUonat expense for PG&Es custcxncrs.

Nor would exdoHng DIablo Canyon from the company's rate base shelter Norlhcrn CaHfornh from big runups In elcctridty costs.IPG&E serres over dc) mIHIon people ln California north of the TehacMph but does not operate In Southern California.)

I h HnandaHy weakened PC&8 would have topsy much Mghcr Interest rates for bonewed money, thus cccaastng Its costs and erentuaHy, Its ratcL.

PG&E ls not alone Jn Its ccccrtous situaUom Roughly 850 bHHonhas bcen lnrestedby the nation's uUHUcs bc un-completed nudcar powa phnts, "itIs quite likely."Har-

. vard energy experts Robat Stobaugh and Danld Yentin recently wrote, "that some of the 80 or so (nudear yhmls)

" In varknss stages of yhnntng and cNNlnxUon wHI never operate."

Sitting useless on the coast near San Luh Obbyo, Dhblo, Canyon h only the most vhble symptom ofan underlying

". IHness wMch phgucs not only PC&8 but the enUre Indus-

'ryc The cled'UHUcs have ksst control of their own

'csUny.

\\

Dhblo Canyon h so Important to PC&E that executives h ve made winning a NRC Hccnse for the phnt the com-

'o. 1 coryorate goal. Yet so scnsitire Is the hsue t ceompany ofHchls are reluctant to discuss the IoxdM-Itythat the 69 megawatt nudear phnt may never opa-ate.

Behind PC&Es pubHc wall of unanhnity, however, an Internal debate rages. The hsue hnot 1Ãabto Canyon Hsclf, but how to aroM In the future lhe eeHcss and cosUy de-hys that phgue any kind of power proJcct and whkh threaten to undermine PG&Es entire Investment program "BuHding a new yowa phnt h a bHHon.doHar crambie based on uncertain fnformatbn about the future," sa)dhns drew ForcL a researcher at the Los Atamos SdcnUAc La-boratory. "Ibere h no way to entirely cHmhcate the rbk, Phase Tarn l<<Psga g, Co). 1 r

CONSTRUCTION samxt NIII 5<<cs lvts,cwtelrCKs cc<<.

stcsctis<<<<<<a is-Sccarcss ass ss<<sl tasvr ic cccceraad tcca.

hiss n <<siss isctsc ls stntg's

<<ccs<<ot espial caret<<cc NIISSIIUS ~

~..

Cscsavcac<<sects arcs ctccs Cs

<<ccucssr. csst st rest tscaccs Iscc ties cscssvstts

<<octa N

. s<<ss I ccaoc sacs) scvsctst ts N Ss<<s sac<<cc y

I 8

)."

~

fp <<pp/

aa Is

. n.n ra rs is rr Is ls

%ass'chsstsls

%&cstil<<a

'h q

~

~ *

'2 Pari Yi-sm.re. Rs. Isso HonAIIficfcn5tuten

Stallecl Nucleai PIa.nt: PiI 8zK Fee4'Powerless:

Coatlaaed from First Page yct making the wrong choice can lead leading to a questhntng of the en-to devastaUng consetucnceL" gtnceflng strategy.

And within PG&E IS One Of the alrungest CIRC-

. k&pit)a argued that pressure from

, trlcutilitlcslnthenaUon. Yctfrom regulators, cnvironmentaltsts and

'nterviews with company exccuUvcs otlim rcqIdrcs the utilityto adapt to

.I'vcrnment officials, financial sna-changing circumstances. particularly

)vts and others, IL ts clear that the by trying to control demand for elec-

- san Faanctsco based uUUty simply Lridtyaud by dcvchplng strategies to cannot afford another experience Uke reduce the risks of rclJtng so heavily Diablo Canyon.

on Ihe lradlUonal lechnologles.

The debate over how to survive the future has split PG&E down the mM-no fundamental fUIat PG&E but add

. dic Tradt~ly,PG&E has bccnrun that Oc dUUcutt problems facing Oe

. by Its engineers. <<ho built Ihe corn-

'ggpggy have lcd to gynic ggPg

~. pany Into Lhe largest privately owned Mcrgy uUIity I Ue U~ted St tes mc besot ymm~

-. during a Period when elcctrldty was hhUCS md,v th there ever were h

.cheap to produce and demand for the Past," @cike ~ "Ihere I4 pr M

. great uncertalnUcs ai to what Nuwth IT% Log~a year

- ~ b~t~g T hy> UC Ieqeht Of Lhe Cn-Jet wcare facedwlodccishns that.

flora whose ranks pfcsldenL I." 4urion Shackelford came, conUnues, than we used to mafc We have had.~.

>I Lo cxcrt a powerful Inllucncc ovcf Oc 'o ayre ~~ Q~hn~ far i, company's opefaUons. PG&E has no

~ choice over thc rest of the centmy,

.". advocatesofOIspolntof vlewcon-C B

p a uUIII Qdmtry fromie Harvanf Business S&ci.

+g'i~d po "..

nd orO uthorsofOe ecent-'

plants-both coal. and nuclear-to

) 'eetly own p~@~ <~8 de

.~ conUnuc wlKbustncss as tuuat with-q r.'

and rq'lace some M&gN.,; out drasUc rate Increases on the order

'. Ilredpo crp IL

.. of 255 pcr year hbthcr Ihan Mstorf-.

C~4 howev~'

ca) Increases. That Is boOso undcstr-

"g a Ay erne~ ~e &W 'bieandsobnllkelyOatsomeofOc j <Uf mosUJ i~ Ia"y~~ "

'ompany's executives are bfgtnntng g~ '"~05': to Recognise fhe dgemma Oe comps-

>.chabman Frederick W. giclke Jr. - nyfa

~~~ ~C~4 PG&E~'here are severs) Indicathns Oat

~

~'no longer be sure that what worked

-'n the pass willcontinue to <<ork ln

.the future.

-LasL month, PG&E annomIccd lt.

These oflais afc not convinced

g. w&d dray U ~g U

for II

't Oe Move tm~mm first r>roposcd coal unthr, gontcxtnna

':ommendcd by Industry cfIUcs w91 f Rsa1 2, In favor of a Oree-monO solve OA pWIcm They SH hold study of enerfrv altefnaUvcs, Indud-

. Ing htcreascd" conscrvaihn,- nower lants <<Idch cwdd run on dgfcrent c

bumng smaller ralher Oan larger coal facUIUCL

-Late lasL year, gage WIIMch,a Ia er who has written a book'with caf sclcnUst Theodore TaJiof on Ihe dangers of nuclear pfolifcraUon,'.

was hired to filla new peat as vice.

~ president. for corporate planning.

Willrkh's appolntmcnt raised eye-.

brows both InsMe and o ststde FG&E forhc brtngs a new outhok to a com-y that has not brought an outsider to such an Important psslUon In de-cades.-In 1978, when the Califonda Su-.

preme Court said the PUC could noi

rcqIdre utiliUes to offer 8% loans to customers for home Insuiathn pur-chases, PG&E, unlike some other utU-

~

IUes, said Itwanted Io continue lo of-

-. fer the below.market keo anyway.

(The state Ltgbiature hst year gave

'he PUC expanded powers to require,'

energy-efmency Investmentx)

-In September, when PG&E sub- '

ndlted Itslatest supply plan, the corn-I pany substsnURUJ Increased ILS pro-:

posed development of cogeneration,:

an encfRJ-saving method of produc-.

Ing use'f~iilheat and eledrldty at In

. dustry RUcs. It atso Indnied plans for cxpfsagng use of load Isanagcmcnt

~ during periods of peal: demand as weH as accelcraUng derelopment of solar heating and wind power. hll such measures lend to reduce Lhe need for new central Ixnrer plants.

.. "I'm. very' the cs a sly 0

son ores entof Oe PUC and oneof the

, [cy hagvMuais In state government

. pushing to Improve energy effidcncy

. and develop new energy sources. "I

. Oink some or Oe people In top man-agement afc ccoggnstng Oe rtsks of Ue trad thnal mcOods and Ue II-

. nanctat advantages of InvcsUng hI Imoroved energy efMency."

Hone. of these has been easy for FG&E It has not moved in this new dhcctlon without tough prodding

from Oe PUC, nor have its executives glvenun Oetf serhus trepMathns.

~

"AutilityIs different from any olh-a business,"

saM Nolan

Datncs,

. PG&Es vice pcstdent for planning and research, and I'm noL sure most people understand that.'e are re-

~ quired to serve the enUre market

<<hcther ith to our advantage or not.

ht the same Ume, we have a producL

, that cannot be stored, yet we have to be ready at any moment to meet de-mand. In plamdng for electricity sup-plies, we can't afford to come up short.".

So far PG&E hasn'L come up short.

But its reserve margins have dipped to dangerously low Icvcis at peak perhds In recent ycara 'fherc Is an

~

OIOI%RMAL ec RNS 0 II%R ORSxi IURI OIIRR

~ >

Sgarggs OCI RSUIKRI US88 I II':t,r',~,> I,". ~~~'PGSE~'-19';~~%$ ~iP4~jj gZj

, ~i. J4$~$ $y ~ +. QILlasI IIIcrat Fdl vfar,ctstu0>)~~.

)~<jgfqpltg Et.ECTAlC POVIHl sxsaxnlut lYDROIttCIRC IOssa Iutt II RRRIIR!XL

~ >>

l ~S'.

'Intense fear <<IUdn Lhe company that soctaHsm-unless lhe power comoa-bccause lt Is so d cnL on hydro-

- nlcs take axrcsstve action to adapt wcr, an unusuagy dry adntcr and r themselves io changlng condlUons."

summer could combine to force..

When Novtck wrote that in 1%8, tmcspcctcd blackouts on Its curio-he dcLcctcd almost no sign ofadspla-mcrs Lion. Meed, as their troubles have ri I

r ~

Evcnthfs potcnULI disaster pales In r mounted, many PG&E officials have

comparison, however, with the accu-,.- tended Lo blame everyone but them problems Lha the electric power industry naUon.

This la not to say that cnvtronmch.'-

Lb~isf~.~~g ~~~cy I pg.~

c, ~ourn M y. ~e clmW tal rcstricUons and story obstat, dhcorcr'cd by a reporter tpposIUon '

wer Industry has dHHculUcs that cles.have not crea'tcd serious Prob-LoGSP&I,'spowcfprojcc tcn to shake the foundaUons of. ferns Bur many PG&E esccuUvcs "Someofuswereawfugydhturbed Lhenatlon'seconomy,"<<rote Sheldon have shnpiy blamed Lhe hxfustrys '

bv the hupHcaUon ln thatyboo'k that'ovlck In "The Electric War." "Eco-.

crlUcs for Lhe companys troubles ar..the Sierra Club was Involved <<1th:>>'..',

~ nomic rcaHUcs have changed, and the Ipdng Uoutsiders would gct out of Lhe..

crooritLs," saki one PC&E ofgctsL ':

new Idgh prices of fuel and capital.

<<ay the problems<<ould disappear.

"But fm afrakf that there are many

-..'hlchsccmtobepcrmanetfca urcs

~

A IQ best-sclHng novel by ~~. ~le h

<<ho sce.the ouLUde on the Landscape of Lhe nest fcw" thur Ifagcy "Gvcrload" <<hfch <<as

<<orldthatway."

yeas, may mean that. the central-

<<rtttcn <<Lth Lhehcipofa PC&Epub-,.

Itdocsn'I take a conspiracy theory, staUonmonopoHesaretraveHugthe HcrclaUonscsccuUveprsvtdcsare..

however, to account for PG&Es l

course of raU passenger service-a

~ vcaHng g at this stULudc. In the' problems. But It Ls necessary to un-

nccessarr service that becomes In-novclamytbtcal "CofdcnSLatepow-,'crstand the power Industry's tre-

':a~l1 emblem~.

a& Vghto-I b Lbyanen.,-~~~m~ydm lors absorb the more lucraUve Indus-vhonmcntal group thc "Sepda *t <<h>> it hss faHel so badly ht dcaHng

~

. Lrhl business. The utgitles'ong fight 'ub," <<hlch Is sccreUy Gnandng sn

<<IAIts t traumas.

~

againstpubllcowncrshlpmaycndin."Irresponsible consumer advocate,.

FortPellrstsevendccadcsofthe. '.

defeat-Uuough recelvcrshlo, as In'ho, in turn. Is In lc

<<lth a ter-uemeorr nccnuans'cram '~i wa<<sZc'o gg'""'~ ~ "~+ <

Please Tora to Psse Ig, Col. 1

\\

~

. PG

's Nuclear Plant tillStalleII~

'w

~I ~

0

~.":. r

-. ready spent nculy gLT MHOQand itwillhave to COQUgge; tdl stcadfl prhgarily because techno)oghai advances and

.to pay the 910 mQHoa amonthbormwhig chargesuntflthe advantages ot scale fmm buflding larger power yhnts ht.

P usc

'plant h approved tor opcraUoa.

i aced thaC each additional yow pojcct ymduccd elccut.

th~ of natural gas in utQity phnis alter 1990. Ealflcr this month. the UE. Dcpar anent of Energy noUflcd pG&E that aa oil-lired power planL thaL was on the drawing

~ boards bef th rui hnposed wouM not be ycr

'mlucd to bc built.ht the same Ume, the CCHfornh Energy g

gt~thILIhIPQ'~~ly~- c.~h~anyncw.~m~hmacshm ted the utiliUes to ecn a ymflton that growing rate base... ~~

wldchmeant that growthm sales assured gmwthlnpmflh withouLthc aced tor Idghcr rates to consunicrs..

...Now aH that has changed. MSUoa has hdycd cause cogstri~l cosLs and borrgwigg egtmsm to soar whflc vc scca a hikes ed energy colts Lhmugh therapy..The U~uUH.

PG&E vice presidcaL "Ibcle Is au rase ltshouM take 16 thc 1913 hrdroilembargo an4 the cnt QpEc price

, which had cogcnged to order dozens ot cw ycsxs to complete a power phut-but IS doer. In thh ea.

yo~yhxns.mosUynudcar.hthe~I9fa Cathe~-

vbgn ec. pG&E has to bc eammdy careful about any pcctaUon that consuuctioa cosh wogM be rdaavdy stable, gmjccl"-

hivcstmcnt lna future power gmjccl and demand woul4 conUnue to gmw rayMiy, was unpre.'8 ve gbi abouth coal lantsasaaaltemaflvetonuclcar wer.

changing allay poll

'uircaicnts of very uncertain nature, and do so with Lech.

. Qology that ls MttuHypmven."

~

i,The Envimmncntal Defense Fund. one of PUBS crit-has pmposcd what itscca as a way out of this dflcmma

< tor the company. It has developed aa economh analysh that suggests PG&E would be beuer offifitdivcrtel near-

. ly aH its phnned spcndhig on big power yhnts to smaller ymjccts wmch cm be devdoped more qdckiy, such as cogcgcraUon. an4 to hvestments by the utiHty to reduce

demaad, such as sohr water hcaUng'and csMCQUaal

. weatherixatfoa.

""We'e ngt out tohur PG&E," argued Davi4 Roe, EDFS West Coast counsd oa uUHty issues. "we'e out to hely then end Improve the eavkugment at the same time. We want to help them recognhe that hvesting ln the demand sMe em be better than aa czdusive focus on supply and Flcssc Tera to Fare 1$, Col I pared for the tgxxiamunrL hnd most <<xccuUvcs did not ex-yect ldgher prices to measurably reduce dcctidty de-manrL "FOCCSSUng pmMcms He at Lbe heat of the present crishh the elecuic utflityindusuy," saM Edward Kahn, a utility expert at thc Unbrcrsity of CSHforgh's Lawrence Bcrkdey Lab. "With hag lead thnes for new supp/ and unforeseen dmp h demand gmwth. many &merman utgl-ties sre caught in the midst of~th ural pmgrams that may gag out to have beea unnecessary.

Nudear power phnts wcm orginafly supposed to pre-vent thh aituatke, by pmvNng what utility ofHdah thought wogldbe a safe. chap energy source that was not eaton fosilfueh.

PG&E, nudcsr yower h SUII preferred by both SMCS h the tatcrnsl debate and the company h culrenUy In-volved ht a lawsuit ~ptnst 1& Fnergy Commhsma to ovcruaa thc Califorma laws rcstricang new nuclear development.

But the czpcience with Dhblo Caayon has yrivatdy soured many company czccuUves. "Being yracUCSI men."

said one finandal analyst for a Wall Suect fgm, "they re-that itwould take a fimdamentaI shitt ln the poHU.

CHmate io make nudcar hvcstmcnt soim4 agahL I can't believe they are prepared to go thmugh another Dia-blo Canyon experience,"

The~ h growth oI dcctrlcity use has ymvMcd a wdcome brea for PG&E durtng thc Ume that

'Ãablo Canyon has beca dehyed. Yct its lnvesucs. whfle thing spdl

~ conUnghig to supply much of the money tor ncw spending programs, are demanding higher snd higher Interest rates

'nd dividend payments to compcns'atc for the hcreased rhk and dctdorauag bahnce sheet.

Because clccuh utQi'Ucs are Ulcmost capital IQLcnive of all industries and am so heavfly dependent on bolmwigg to finance Mw cogstructhC hvesiors'ttitudes are criU-caL Despite~ dbrMcads and xdatbrdy good earnings, PG&ES stack prtoe hasfaflen ln the last decade fmm near-

ly SI0 per share and a picc/earmngs raUO of 15 to less

than 929 a share, with investors wdflng to pay only seven

times annual earnings for tts common stock. Instead ot

sefling wdl above book value. as its stock did h the 1950S

and 1960s, PG&E is now selling about 207o below book

'. value. which means its exhting sbarchoiders'take h sub-

. stanuafly diluted each time the company hsues more stock to raise capitaL Inflation. of course, has hurt many other companies in the SLOCk market aS well But h haS a aaUCuhriy harmful effect on utilities hkc PG&E. wiich'must now pay very high interest rates to bolmw money over long pcrieh ot

~ Umc, meaning that many new power plants end up cosung

~ nearly as much in lntcrcst payments as in actual consuuc-

~

Uon expense@

The quality ot PG&ES earnings, the amount of internal cash flow, are at historic iowa." said the PUC's Ray Cmhr inrecenS testimony, "and this is dirccUy attributable to the Invcgmcnt in Diablo Canyon. Considering that there h great uncertainty as to when and itthe ylant is included in the earnings base of PG&E by the PUC. additional expen-ditures on capital intensive pm',ccts.wldch require long lea4 LLges would only exacerbate PG&ES currem financial posiuoll When Diablo Canyoa was originafly pmposcd-thc first unit in 1966 and the second in 1968-thc estimated cost was about $320 million,or apgmxgnatdy $ 147 for each ki-lowatt of InstaHC4 capadty h 1911, the esumate was re.

tOQ tHH Qa gs

'. (lL Is) someUdng whkh has never been done. and (we

" must) meet a 'fair uUon contml re-

After 14 Years, PG tm's l~ituclear Plant Is Still Stalled

~

~

CeoUoocd from 13th Page aonN teal fhaadal ftom having mits of HUH mega-

-derekpcd ~< piuvMC fhandaf watts or IcsL h kt nds an Lhe mlnchI enrhonment r

ugll Inrdvement In Ixxtm on's two Dudeat urdta arc about llMmw each, <<hUC only <<ay h here Ihat lhcmcetcost&fccUve lnvatmcat h tcccnt studyby Los hhnxe Lab's Andre<<Ford sup-

~

aorta the argument h fs"cf of small coal uDILL"Because The pUC has csponded to Sh cdtkpic by cond"cthg a larga power phnh cost less tobuHd foroach tHO<<att of InvesugaUon hto PG&Es supply pi<<n one apadty, lth ceca Sept Sat Setrcnd towards hrger of Ihe firstsuch cxandnaUonxcrcfby a teguhtofyf agency power phntsmaka jtoi.>a<<Nude sense." Ford wrote ha In the Unacd Statcx fortlicomlngarUdc.

Ccrc my of scale ls not always auHi-fa tbe Hist ruHng to come out of Sat hvcstpdaUon Sc dent to justify Ihe eho.r of larger phntL Large phnts PUC last ar flmdSN PG&E had noL acUr'dy pursiaxI suffer flam rdhmity probkms <<hkh an negate Sdr Xp-eactagg as a mxkx supply ooUOD and txiposcd a gf'arent cost adraniage. '.Dcy also take longer Io approve

~Lm proHL penalty axahst PG&E h hducc grater and onstruct. makhg demand forccasUng and system aUcadcvd uncut phnnlng more dHHcuit.%'cf manytuHIUcs, tt may wcabc

~nstad cf appaIInc So dcdskn, as lt ffrobabiy wldd Sat a coHCCUou of smaticf po<<ef planh would lad to D have ln the past. ME <<Hi attempt to'rocct Se PU<s hwer prke of elcctddty for thdr customers and fewer goal of contracthx fcf60 megawatts af ucw power from phnnhgbeadachesfort drcxecutlreL" agacm m4 Se~ y Fof tbe Hist thne shxe ataUsUa have beea tcfd. Ihe

<<&d~ae SOME th Sc~~'.

DUlityhdustry hst year reversed the tread to hrgcr units and ordered new planta that werc somewhat smaHet, Lodng that money ccttahly got our attcnUOD" 'saM. On average, than those crdcred the facvkus yar.

Sta!Qcyskhncf D

cxecuU c hce ca + ~

That mar have'cuir been.a lop finmchI man at S m~."MIt~p&~a

~

though, anf the debate Iscertahly Dot SCLUed. rbcrc are lot of worric beam C~a h~~cat 1

sUU cconmies ofscale but they <<Hlnot permit us to lower on ouf efforts but also Lhc>cocpciaUon ofoUlcfs fata as <<c tax>> dkL>> P~&E~~~~

V/hat worrtcs axnc of PG&l>,a cxecusvcs crea morc

>Ther mav not bc as fiiaicnt aboutcogcnctattmis Ihatls enafhahdustrhluscra,shcp-dHI l

ping centers and other large en'ctgy users to produce thdr own elcctddty instead of fd~g on the utility. "Why should <<e pay someone to csxnpctc with us?" qucsUons: 'bePUC has folio<<Ofup its PG&EhresUgaUonby<<n onePG&EoffkhL

~,.

aquaHyha I

or<<hrcaergyfhaachg<<Dich But OSers sce advantagca to pG&E from cogencraihn.

recommends that aH or ihe state's uiiuUes be vcHidtcdao "ILmay well be that (cogcrzcraUOD and other untradiUonal fmaoce cost-cffccUrc h wU>i4n of solar <<ster heaters h.

oowcrprokcts) are tost as capitd intensive,"SSMWHMch. 'esMcncca hlieadh, the'.~UC found, itis cheaper to tcduc>>

but oa 6e other hand 'Ibc company couM benefit ficta elcctrldty demand by >>>phdng cicctrk water haters sldfting some fnvestmen'; hto dUfcrent fual and not have with sohu'nlh San It~rouMbe Lo fmanc>> a new power to shoulder these trcmeixddis oosis ItscK"

~ phnt to ploduce more c'.ectridty.'hnd solar water hest h SmaHcf proJectsthat.t>>nbadcvelopcd faster thantradl-.

nearing the compcUUvr poht <<Ith natural gsa as wdl, Uonal power plants are aho viewed by some czccuUres as given Le dramauc an4 anUnuhg natural gas pike hHu>>

a war to ease the co'smany's Hnandal Npieexc. "lt's a real ofrecentmonthL broa8 g licfalix Hood ol course, but as a fuic thc fastcf you Iforhg in Sis dbectkxi ts SNL fikdyto cHmhate Sc

. gct a return on ln vestment, the greater finandal advaa

~ need for every new bas;had power phnt, even under the itage&ereh,"salflskhncr."WhatweareexploringhSe best of drcinnstaixea But many of these profound

total context of 'whether the aitcrnaUra wiH ulumatciy'.

chatutes may well have Io wort chdr way Mdc DUiiUes

'. Dtoduce thc amount of gcnctathg fcsoutccs Ill Qie Ume" j like PG&E lftbe industry Is ever gohg to be restored to

~ frame accdcd.".,

~

I cconoudc vitality.

ht Se same. thne, Ihe ttadiUonal hdultry trend hward 's H stands today Pt~

.,hdlding hrxltr and higer generating units h bdng chaI.

IsUng apadty of about IS,txo mcgawaus by 1998, a gcuI Icnxcd <<ith4 PG&E'sexccuUvcorsices.

Company ofschh adlai'ay "We ale Oohg to examine the <<hole assumpUon that big power p4t'Ls are better," said Wililkh."perhaps there are coal and nudear fadHUis, with the hrgcstchunk ofother xewet comhg frumPG&E's hnovativc gcoSctmai ~<

6 the Geysers area north cf San fandsscxx But.recenUy the company bas dguUkantly hcteascH the amount. of generating capadty It expects to gct froml cogcncraUOD Dnd smaH hydro and xrhd profccts to agre'.

than lgO megawatts by.IIKL Even morextgnUtantly,xiew poHcy CrecUoas frcln Se

'UC suggest IhatPG&E<<IHbecome much morcxcttvc h liadtlng pattkmandbydhanchg hnmetnudaUon;load management dcvkes anduScr dcccairaHxcd to hdp avid thc need Xor massive commitments to

'puef picfcctL "Se don't re@r secany+Hferfrxe dn~ be-

-tween PG&E xsid Lhc 3'UC," M4FS.tdidrman,.Fred 4ficlke,.satL "We atc tryhg to maxhahe conscryattm h

<very <<ayand <<ccrc cncouraghg Our peaple to be hno-

<<SUre.hny sappy jxdky now depend an that."

If these new dicceUODS prore successful, analysts an5 enetgycffidah say JG&Emay need kssihst half as many power phnis, <<Ith the gap being 8!ed by hnpiovcd ener-gy cffidency mid smaller gencrathg mdts, such as coge-.

nerstkm JacHIUea. Ifthey're Dot partkdhrly successfuL PG&Eandits customers

<<IHbefaced

<<Uh eral crunch.

"I<<auld Uke Lo sc>>D sfhohlotxixxc coopcraUon among DUHty managers, rcgdhtora an4 enviionmcnhi gloups In dcaHng <<1th Sexirofound pnddems of Sc utIHty Indus-

try, saMHammfsQdp'he<<hHephnningpro-'css liccds'to'hc hrcltod alxl demand an no kmgcf bc treated assomeQdngthat has alUC cf its own.'fhe rhk af having too much or the<<ronghI ofapadty has Imply becometeograt forthst Old systemh continue.

"PG&E'and the other Caiifomla utilitics are among the few xdHIUcs actually glspphtg with these problems. but the rest of Sc Industry h gottgao hare LOSLutsoorL Oth-er<<isc, the situation for ai1 of us h going to gct worse and wotsc.

aaaWie