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Board Ruling Seen Slowing or Blocking Nuclear Restart

May 14 (Bloomberg) -- A U.S. Nuclear Regulatory Commission licensing board ruling may delay or block Edison International’s plan to resume operations at its shuttered San Onofre plant in California, according to an analyst.

The agency’s Atomic Safety and Licensing Board yesterday determined that the NRC’s process for approving a re-start of the plant amounts to a license amendment proceeding. That means environmental group Friends of the Earth, which petitioned for a public hearing, will have the opportunity for one, the agency said in a statement.

“Unless overturned by the NRC commissioners,” Paul B. Fremont, an equity analyst with Jefferies LLC in New York said today in a research note, “the decision will delay the restart of the plant for 6-12 months.”

The plant is “one step closer to shutting down permanently,” he said.

Both reactors at the San Onofre plant, about 45 miles (72 kilometers) southeast of Long Beach, California, have been out of service since January 2012, after the company discovered unusual wear on steam-generator tubes. Edison, owner of the state’s second-largest utility, has said it may decide by the end of the year whether to retire at least one of the units if the plant can’t resume operations.

Rosemead, California-based Edison is seeking a license amendment to operate Unit 2 at reduced power. Edison subsidiary Southern California Edison Co. operates the plant.

MacFarlane Comments

Allison Macfarlane, the chairman of the NRC, said there were “potential opportunities” to hold a public hearing on San Onofre before regulators decide on its application to re-start. That decision won’t happen until late June, she said.

“I know there is strong public sentiment for a public hearing prior to a re-licensing,” Macfarlane told reporters today at a Nuclear Energy Institute conference in Washington.

She said the commission would hold small-group meetings with state and local officials to explain how regulators will decide whether to give the nuclear plant permission to operate again.

Friends of the Earth, based in Washington and Berkeley, California, has said the San Onofre plant shouldn’t be allowed to return to service without a public hearing. The ruling by the three-judge licensing board “is a tidal wave that is rammed into the re-start plan,” Damon Moglen, energy and climate director for the group, said yesterday in a phone interview.

‘Total Wreckage’

Edison’s plan is in “total wreckage right now,” Moglen said.

Southern California Edison spokeswoman Jennifer Manfre said in an e-mail that the company is reviewing the panel’s decision.

The ruling sets a “legal framework for a full public hearing before any final decision on the re-start of the San Onofre nuclear plant is made by the NRC,” Senator Barbara Boxer, a California Democrat, said yesterday in a statement. “Given that the NRC commissioners asked the board to undertake this review and given that these judges were appointed by the NRC, I expect the commissioners to follow their lead.”

The NRC won’t make a decision regarding the license amendment until mid-June at the earliest, based on a Federal Register notice, agency Chairman Allison Macfarlane said in an April 26 letter to Boxer, chairman of the Senate Environment and Public Works Committee.

The NRC is requesting additional information about Southern California Edison’s analysis of steam generators at the plant, according to a May 10 letter from the agency to the company.

To contact the reporter on this story: Brian Wingfield in Washington at bwingfield3@bloomberg.net

To contact the editor responsible for this story: Jon Morgan at jmorgan97@bloomberg.net

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