Providing Nuclear Power Safely and Responsibly

Ongoing Seismic Studies

PG&E remains focused on ensuring that Diablo Canyon continues, and improves upon, its strong record of safe operations. This includes making the facility resilient to natural hazards, including earthquakes and tsunamis.

PG&E is the only utility in the country that employs a seismic department staffed with experts. The scientific staff continually studies earthquake faults in the region of the power plant and global seismic events as part of the plant’s comprehensive safety program.

In November 2008, the U.S. Geological Survey (USGS), working in partnership with PG&E’s geosciences department, discovered a new shoreline fault zone, and PG&E evaluated whether that new feature presented a safety risk to the plant. PG&E submitted its evaluation to the Nuclear Regulatory Commission (NRC) under the commitment of its current operating licenses. PG&E’s evaluation confirmed the plant has adequate safety margin to withstand maximum ground motions postulated to occur from faults in the region, including the shoreline fault.

PG&E plans to undertake high-energy offshore 3-D studies of the shoreline fault’s deeper regions as soon as it obtains necessary permits from various regulatory agencies, including the State Lands Commission, California Coastal Commission and County of San Luis Obispo. To address public concern regarding the seismicity of the area surrounding Diablo Canyon, PG&E is seeking to expedite this permitting process so it can begin this phase of studies as soon as possible. PG&E also plans to conduct significant research along the Los Osos Valley and in the Irish Hills. The company will share the results with local jurisdictions to enhance their knowledge of the seismic characteristics of the region for their emergency planning and building standards requirements.

Even after we have completed these advanced studies, our geoscientists will continue their ongoing seismic research to give us, our regulators and the public confidence that the plant remains safe.

Operational Investments and Waste Storage

Since operation began in 1985, PG&E has invested more than $1 billion on significant upgrades in Diablo Canyon. In 2010, this included a planned outage to refuel Unit 1 and replace its reactor vessel head to improve performance and reliability. This was the plant’s safest outage to date.

Last year, PG&E also continued to decommission its retired nuclear unit at the Humboldt Bay Power Plant near Eureka, California. In 2010, PG&E completed large component removal as part of the first phase to remove radioactive components, piping and some structures. Subsequently, PG&E will remove all other equipment and decontaminate structures to permit building demolition and site restoration. PG&E expects to complete the decommissioning process in 2015.

At both Diablo Canyon and Humboldt Bay, PG&E uses on-site dry cask storage systems, approved and licensed by the NRC, to safely store used fuel until the federal government fulfills its commitment to take ownership of the fuel by building a permanent storage facility. These on-site storage systems, used at nuclear power plants across the country, protect the used fuel against a range of threats, including severe weather, earthquakes and terrorism.

Current California law prohibits the building of any new nuclear power plants in the state until the federal government takes ownership of the used fuel. PG&E currently has no plans to develop new nuclear generating capacity.

(For additional information on waste storage and other issues associated with Diablo Canyon and Humboldt Bay, please see page 52 of the PG&E Corporation and Pacific Gas and Electric Company 2010 Annual Report to Shareholders.)

PG&E’s Request to Delay the Diablo Canyon License Renewal Process

Diablo Canyon’s current federal operating licenses for Units 1 and 2 expire in 2024 and 2025, respectively. In late 2009, PG&E began the process of seeking 20-year license extensions for each of the two units through 2044 and 2045—a necessary step toward meeting the state’s ambitious greenhouse gas reduction goals and continued demand for reliable, low-cost electricity for homes and businesses.

The earthquake and subsequent tsunami in March 2011 that damaged the Fukushima Daiichi nuclear power plant in Japan has understandably raised public concerns about the safety of U.S. nuclear facilities. While the lessons from Japan are still emerging, PG&E takes seriously the concerns expressed by its customers and neighbors in the community about the seismic safety characteristics of Diablo Canyon.

In response to those concerns, PG&E made a formal request of the NRC in April 2011 to delay the final issuance of the plant’s license renewal until the company completes 3-D seismic studies in the area and shares the findings with the NRC.

The NRC formally responded to our request and has taken action to revise the license renewal schedule in a way that allows us to complete these important studies before taking a final action on our application.

Supporting the Local Community

Diablo Canyon contributes greatly to the local community. In addition to the thousands of hours our employees volunteer for after-school athletic programs, environmental organizations, churches and other community organizations, the plant also makes significant contributions to the local economy. As a major employer and purchaser of goods and services, Diablo Canyon has a total economic impact of more than $950 million annually for the region and another $100 million for the state.

As part of PG&E’s commitment to be a good neighbor, we also make local charitable contributions of more than $300,000 annually, funding a wide variety of school programs, senior centers and other vital community projects.

In 2010, PG&E renovated its Energy Education Center, where visitors can learn about the plant and a range of energy-related topics. The center is also available for use by the community as an evacuation center in the case of an emergency.

Land Stewardship at Diablo Canyon

Diablo Canyon is located on one of the most scenic coastlines in the country. The plant is surrounded by roughly 12,000 acres of land that is managed by PG&E and serves as a home to many species of plant and animal wildlife, including the American peregrine falcon; nearshore marine habitats support several marine wildlife species, including the brown pelican, southern sea otter and northern elephant seal.

PG&E’s active stewardship of this natural resource includes livestock grazing, which has resulted in a healthier rangeland habitat that sustains native plant species while reducing invasive plant species. PG&E also allows scientists and others to explore the area’s habitat and ecology. This includes archaeology students from nearby California Polytechnic State University, who, in partnership with PG&E, are engaged in a multi-year research project focused on the prehistory of the Pecho Coast. A field class in 2011 provided a unique learning experience for the students and is assisting PG&E with managing and interpreting the rich archaeological resources located on the property.

The property also includes two scenic trails that are open to the public—the 3.3-mile Point Buchon Trail and 3.75-mile Pecho Coast Trail. As part of our broader effort to promote environmental education, docent naturalists, which include plant employees, lead groups along Pecho Coast Trail and provide information about the location’s history, cultural resources and biological diversity.