While initial estimates warned of a $1 billion hit to the regional economy when the Diablo Canyon Power Plant shuts down in 2024-25, a new study suggests that its actual impact will be less severe.
Researchers at UC Berkeley released an economic impact assessment on June 28 that analyzed the effects of the plant closure—which came at the order of Senate Bill 968, authored by Sen. Bill Monning (D-Carmel).
The assessment concludes that PG&E's decision to close the nuclear plant will result in an $801 million overall reduction in economic output in SLO County, with a loss of 2,908 full-time equivalent (FTE) jobs.
But when post-shutdown plant activities are factored in—including waste management, security, and other services associated with the plant—the picture appears less grim. Those activities are expected to provide a $724 million boost to the local economy and 4,938 FTE jobs for 10 years.
That calculates to a net annual economic loss of $77 million, which is "far less than previous estimates ... or 13 times our estimate," according to the report.
"Taken together, we find that the net effect of these factors will be much smaller than previous estimates for Diablo Canyon Power Plant's closure," the report reads. "Previous studies have only considered the negative shocks; whereas, we take account of how decommissioning expenditures will substantially offset economic losses attributable to plant closure."
The study went on to note, though, that the economic boom from decommissioning activities is likely to taper after 10 years, while the impacts from the plant closure will remain in perpetuity.
Prior to the closure, SLO County and its cities and school districts are also receiving $85 million in mitigation payments, and plant employees $140.8 million in retention bonuses, as a result of SB 1090, which passed last year.
According to the study, those funds will create 349 FTE jobs and increase local economic output by $40 million for seven years.
In addition to looking at economic output, the study also included the results of local stakeholder consultations, a survey, a real estate market assessment, and a bond market assessment—all centered on the plant's closure.
Local leaders believe the report will help the region navigate the future once PG&E, which is the county's second largest employer, shutters Diablo Canyon.
"The Diablo Canyon Power Plant has been an important part of the local economy for decades and the region needs reliable data and information to prepare for its safe closure," Monning said in a June 28 press release. "Information from this report will give the county and schools the tools to plan ahead to mitigate any negative impacts of the power plant's closure." Δ