Calif. lawmakers bend, support $400mil to keep Diablo Canyon running

Gov. Gavin Newsom overcame furious opposition to funding continued operations at the state’s last nuclear power plant.

One month after California lawmakers balked over a nine-figure loan to Pacific Gas & Electric to assist in extending the life of the state’s loan operating nuclear power plant, lawmakers folded to pressure from Gov. Gavin Newsom.

Monday, lawmakers folded in the funding for a $400 million loan to keep Diablo Canyon Nuclear Power Plant operating.


Inside the debate: Newsom argued that Diablo Canyon is critical for maintaining grid stability during the state’s transition to clean energy, while legislative leaders questioned the necessity and cost-effectiveness of keeping the plant open.

  • The approved budget deal includes the $400 million allotment, along with a requirement for the Department of Water Resources to report on how the money will be spent and unpaid balances.
  • There is criticism and concern surrounding the loan, with some arguing that taxpayers will end up footing the bill for PG&E and that the loan will never be paid back to the general fund, putting the burden on taxpayers.
  • The approval of the loan and the decision to keep the plant open has caused friction between the governor and lawmakers, with environmental and anti-nuclear advocates warning of a growing price tag to keep the plant open and ongoing legal challenges related to the environmental impacts of extending the plant’s life.

The big picture: Diablo Canyon, California’s last nuclear power plant, contributes roughly 9% of the state’s energy on a given day and was initially set to close in 2025 before Gov. Newsom passed a bill to extend its life to 2030.

  • The federal government’s award to PG&E fell short of the expected loan amount, and the timing and amount for loan repayment remain uncertain, raising frustration and concerns among lawmakers.

What they’re saying: “Keeping Diablo Canyon Nuclear Power Plant online is prudent and cost effective,” said DWR spokesperson Ryan Endean.

  • “The final budget deal with the Governor represents a total capitulation to PG&E and its shareholders,” Utility Reform Network attorney Matthew Freedman wrote. “This $400 million will never be paid back to the general fund, forcing taxpayers to absorb the costs.”
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