Electric companies seek taxpayer cash in the desert

"Cost recovery" letter filed in Inyo County for San Onofre reef project

Says right there, filed in Inyo County — home of Death Valley
  • Says right there, filed in Inyo County — home of Death Valley

Though the project is still failing its main mission, Southern California Edison and San Diego Gas and Electric last month asked for consumer rate increases for the cost of building a 150-acre reef to make up for the underwater damage done by San Onofre Nuclear Generating Station.

In filings with the California Public Utilities Commission and a letter inexplicably filed in Inyo County — which is closer to Las Vegas than any part of the California coast — the two power companies ask for rate increases that will generate $33 million in new revenue between 2018 and 2020 to pay for the reef project.

The Wheeler North Reef was constructed between December 2004 and September 2008 to make up for the devastation of 179 acres of dense kelp habitat and the community of sea life and fish who lived in it. In 1991, the California Coastal Commission ordered the power companies to build a reef to replace fish habitat that was ruined by the nuclear plant pumping cloudy water used for generators 2 and 3 into the ocean near the plant, according to coastal commission records. The commission also ordered the companies to pay a panel of independent marine scientists to monitor the reef and provide an annual report.

The manmade reef's southern edge lines up with the north edge of Camp Pendleton and extends 2.5 miles up the coast to San Clemente. It is about a half mile offshore and was built in three phases once researchers had identified areas that did not have existing reef. It was named to honor Wheeler James North, a marine biologist who pioneered the study of reforesting reefs and brought scuba diving to the field as a tool. He died in 2002.

An assessment by marine biologists in September concluded that the project earned zero mitigation credits. Each credit is for a one-year period that the reef meets all required standards; 33 such credits are required by the coastal commission. The reef scored high marks on stability. A big kelp forest grew in and unwanted or invasive species haven't shown up. But neither have the fish and shellfish, not in large enough numbers to move the needle toward success.

Marine biologist Stephen Schroeter presented the findings in September. Calls to Schroeter were not returned.

Despite the reef's current failing grade, SoCal Edison and SDG&E are asking for a rate increase that would generate $33 million in new revenues between 2018 and 2020. The revenue would be split among the power companies — SoCal Edison holds 78 percent, SDG&E has 20 percent and Riverside has just under a 2 percent share. According to utilities commission filings, the coastal commission's orders require the mitigation for the "full operating life" of generators 2 and 3, whether or not the nuclear generators are working. The application notes, "SONGS expects to continue to utilize the discharge conduits during the decommissioning period for the foreseeable future." In other words, water continues to be pumped into the ocean.

The coastal commission gave the power companies two sets of performance standards — 11 relative standards compared against a natural reef and 1 set of absolute standards. The artificial reef met the relative standards, according to Schroeter's report. And in 2016, it met all of the absolute standards except one: though reef fish and invertebrates had shown up on Wheeler North, the reef didn't have enough fish and invertebrates to meet the 28-ton requirement set by the coastal commission.

The coastal commission's fish requirement is based on the goal of having the manmade kelp forest serve as a nursery for more fish. Several years ago, monitors found that the estimated tonnage was about half of what was required and that many of the larger fish were visiting from nearby natural reef.

"That's true of all reefs — some fish are transient and some are resident," said University of California Santa Barbara marine researcher Dan Reed.

The reef's best year was in 2014, when an estimated 25 tons of fish inhabited the reef. In 2015, the fish count came in at around 17 tons and researchers are expecting a similar tonnage this year, Reed said. "To reach 28 tons, there has to be more reef."

The power companies challenged the coastal commission's decision on how long they have to mitigate — since the plant shut down in 2013 — and which set of standards to follow to measure the reef's success. In September, the commission rejected their arguments. The companies must continue to work on the artificial reef to meet the absolute standards, the commission decided.

The Utility Reform Network has already filed an objection to rate increases for the reef, saying the request is unreasonable and premature. And they didn't seem to believe the cost estimates, according to PUC filing.

"More than 85% of the approximately $33 million of total project cost is for acquiring rocks, transporting those rocks to the project site, then using those rocks to construct the reef expansion (which TURN surmises to entail dumping the rocks overboard)," their objection states. "Clearly the reasonableness of the overall project costs turns largely on the reasonableness of rock-related costs."

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