Enviros drop lawsuit over federal bailout of Diablo Canyon

Friends of the Earth on Wednesday withdrew a federal lawsuit seeking to stop payment of $1.1 billion federal bailout of California’s last nuclear power plant, court papers show.

The group dropped the suit, filed in April, after Diablo Canyon Owner Pacific Gas & Electric Co. (PG&E) revealed Jan. 6 that its plans to extend the plant’s life by five years had already been funded by a separate $1.3-billion loan from California, provided in full to the utility by August 2024.

On top of that, Friends of the Earth said, California agreed to forgive its loan to PG&E even if federal funds from the Department of Energy’s Civilian Nuclear Credit program were unavailable to pay it back. 

That pulled the rug out from under the environmentalists’ case, which rested on the assumption that blocking federal funds would prevent the plant from operating or from paying for a license extension application with the federal Nuclear Regulatory Commission, Friends wrote in a press release distributed Wednesday to media.

“Friends of the Earth’s position has been that any court-ordered vacatur, injunction, or other remedy in this case would interrupt the billion-dollar [Civilian Nuclear Credit] award and thus impede Diablo Canyon’s ability to continue operating, thereby affording temporary or permanent relief from the dangerous, outdated facility,” the group wrote in the release.

PG&E’s Jan. 6 disclosure to U.S. District Court for the Central District of California, Western Division “very likely moot the case,” Friends of the Earth said. The group filed a separate statement with the court.

The environmentalists wanted the court to stop the flow of federal funding because, they claimed, the Department of Energy awarded it without performing the required environmental review of the life extension.

Instead, Friends of the Earth said, DOE relied on old reviews conducted by the NRC, including some that date to the 1970s. 

PG&E’s operating licenses for Diablo Canyon Unit 1 expired on Nov. 2, but NRC has allowed the reactor to stay online while staff vet the utility’s license renewal application. Unit 2’s license will lapse on Aug. 26, 2025. Commission staff have said they could finish reviewing the renewal application in August 2025 or so.

PG&E has applied for a 20-year license extension, though California so far has allowed only a five-year life extension for Diablo Canyon.