Tuesday, February 10, 2015

The Great Mystery of San Onefre

2.28.2015   The weirdness of this story continues to amaze me.   These private utilities seem to be nothing more than complicated scams to deliver the wealth of rate payers to an elite at the top of a private utility, quote end quote, that has no risk, only benefits.  They can make any mistake, and the rate payers will pay for it with the governments understanding and approval.  The CEO of SCE only makes 2.3 or so million a year, so its not as if it is infinite money.   

As I dig out more reference material, this post will be updated, and eventually may even be an informative summary of what happened here and who paid for it.  Right now, though, its far too loosy goosy with the facts, a situation I hope to remedy, with time.

2/20/2015 I continue to read about how such things as nuclear power plants are financed and indeed it is something of a worst case scenario.  Not only are nuclear power plants famous for costing at least twice as much as estimated, indeed they are nearly all paid for by the "rate payers", e.g. you and me, and with government guaranteed credit, at least in part.   When you realize that top executives at power utilities refuse all but a token salary, it is a little easier to take.  One CEO of an energy utility only makes 9 million $US / year, although I am told that there is also other compensation in various ways that are beyond this modest fee.

When the great ones who nobly serve society by generating and selling us electric power announced to a cheering world that they would shut down the nuclear generating station at San Onefre many questions occurred to me that did not seem to be answered in the highly detailed two or three paragraph in-depth articles written about the situation by our Fourth Estate.

But that was long ago, and as time passed, I knew that our tireless and intelligent press would think to ask these questions and report to the world the real situation. Sadly, this has not taken place and none of these questions have been answered. So I set to discover the answers to these great questions on my own, and clarified a few details in the clusterfuck that is San Onefre, but sadly not many of the answers that I sought were available online.

Nevertheless, I can describe the situation to you and what I think some of the questions are that should be asked, and even answered.

In the following discussion, the operators of the plant are referred to by SCE/SDGE which stands for the partnership of Southern California Edison (80%) and San Diego Gas and Electric (20%).  There is a third partner with less than 2% ownership.  The design and engineering subcontractor was Mitsubishi Heavy Industries.  NRC stands for Nuclear Regulatory Commission.

The situation.

Once upon a time, a long time ago, when the San Onefre nuclear generation system was built, the citizens were told that this plant would have a certain useful life. But it turns out, it didn't. And it was discovered that it didn't when the heat transfer system pipes (1)  started breaking. So they shut the plant and made arrangements to fix the heat transfer system which meant that they had to replace a very important part of the system.  They told the NRC that they were just replacing the system (in other words, no new engineering), but they were in fact redesigning the system, which should require proper notification to the NRC and their approval.   I am not sure who did the redesign, SCE or Mitsubishi Heavy Industries, but it was MHI that had the contract to build the new system.  This cost $750 M and the contract limited MHI's liability to 1/5th the contract amount.  But when the new system was installed it was found to be much worse than the original system.  So the plant was shut down again.   Only this time most of the $750 M was gone and they would have to start the process over again.

Boy, were their faces red.

The unanswered questions.

1. Why did they need a new heat transfer system before the end of expected life? Were they lying when they estimated life of equipment or were they merely incompetent? Or if they were simply wrong, were they lying when they said that this plant was not a research project?   You see, there is a difference between engineering and research.  In research, you do not know how long something might last, so you have theories and you run tests.  Then you create pilot plants and run more tests, and when you have your principles down, then you design a production plant based on what you have tested and know to be true.  It is not R&D to build a bridge, it is engineering.   A well-engineered power plant will have an estimated life that is likely to be exceeded in reality because it was over-engineered to do so.

It sounds as if they were either lying about this being a production technology, or that they were incompetent when they designed both the first set and the second set of pipes.

2. How is it possible to spend $700 million dollars on a new heat transfer system without having tested it first to know if it would work?   If there were risks to the new design, then it should have been tested and/or the contract not have limited liability.  

3. Were the operators supposed to notify NRC before doing this type of work or not?  If not, what are the penalties?   Why did Barbara Boxer call for criminal charges against SCE/SDGE and what became of that?

4. The decommission of the plant will cost over $4 billion dollars. There is a trust fund that has most of that money already. But where did that trust fund come from? How much of that is paid for by the customers and how much by SCE/SDGE?

5. Over 2,000 highly trained workers are being let go from the plant. What plans are being made to help those workers whose termination will certainly affect the economy of N. San Diego county.

6. How is the power that is being bought to replace the power from San Onefre being generated? Who pays for it, that is, who pays the additional fees?

7. What is the long term change in carbon output which is coming from this change to other forms of power generation, and what are SCE/SDGE's plans for mitigating this?

My suspicion is that the original plant, the changes and the removal of the plant are all paid for by the people of San Diego and Los Angeles and that this is just another scam for government to create a monopoly to give their friends a lot of money. I dont have a choice about where I get my power from, so I have no recourse but to use the bad decisions and management of SCE/SDGE.

My suspicion is that the reason SCE/SDGE were not punished for violating the law vis a vis the NRC is because of course their friends at the NRC and PUC protected them.

 As they always do.

What lessons can we learn from these series of events?   I propose to you that the lessons learned are (a) we can not trust the power companies, the NRC or the PUC to look after our interests and be honest with us about what is going on and who is paying for it, (b) that the best business to be in is a government enforced monopoly, like power generation.

That is where the real money is in America.


1. San Onefre is, or was, a pressurized water reactor.  What that means is that one set of pipes contains water at pressure that flows through the reactor spaces and is heated by the heat generated from the nuclear reaction.   This hot water at pressure flows through the pipes to pass next to other pipes which also contain water at pressure and heat is transferred from the first set to the second.  No water is actually transferred, just the heat.  The heat in the water of the second set of pipes has not been directly irradiated and therefore is not radioactive and this is the water that drives the steam turbines that actually generate the electricity.   You do not want the water from the first set of pipes to leak because that water is radioactive.

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