Aerial view of the Diablo Canyon Nuclear Power Plant which sits on the edge of the Pacific Ocean at Avila Beach in San Luis Obispo County, California on March 17, 2011.
Mark Ralston | AFP | Getty Images
California is not keeping up with the energy demands of its residents.
At the same time, the Diablo Canyon nuclear power plant, owned by Pacific Gas and Electric and located near Avila Beach in San Luis Obispo County, is in the middle of a decade-long decommissioning process that will take the state’s last nuclear power plant offline. The regulatory licenses for reactor Unit 1 and Unit 2, which commenced operation in 1984 and 1985 will expire in November 2024 and August 2025, respectively.
Diablo Canyon is the state’s only operating nuclear power plant; three others are in various stages of being decommissioned. The plant provides about 9% of California’s power, according to the California Energy Commission, compared with 37% from natural gas, 33% from renewables, 13.5% from hydropower, and 3% from coal.
Nuclear power is clean energy, meaning that the generation of power does not emit any greenhouse gas emissions, which cause global warming and climate change. Constructing a new power plant does result in carbon emissions, but operating a plant that is already built does not.
California is a strong advocate of clean energy. In 2018, the state passed a law requiring the state to operate with 100% zero-carbon electricity by 2045.
The picture is confusing: California is closing its last operating nuclear power plant, which is a source of clean power, as it faces an energy emergency and a mandate to eliminate carbon emissions.
Why?
The explanations vary depending on which of the stakeholders you ask. But underlying the statewide diplomatic chess is a deeply held anti-nuclear agenda in the state.
“The politics against nuclear power in California are more powerful and organized than the politics in favor of a climate policy,” David Victor, professor of innovation and public policy at the School of Global Policy and Strategy at UC San Diego, told CNBC.
Concerns about nuclear plants and earthquakes grew after the 2011 disaster at the Fukushima Dai-ichi nuclear power plant in Japan. On March 11, 2011, a 9.0-magnitude earthquake struck Japan, causing a 45-foot-high tsunami. Cooling systems failed and the plant released radioactive material in the area.
In July 2013, the then on-site Nuclear Regulatory Commission inspector for Diablo Canyon, Michael Peck, issued a report questioning whether the nuclear power plant should be shuttered while further investigation was done on fault lines near the plant. The confidential report was obtained and published by the Associated Press, and resulted in an extensive review process.
The Hosgri fault line, located about 3 miles away from Diablo Canyon, was discovered in the 1970s when construction was in early stages and the NRC was able to make changes to the research and construction plans. Peck’s filing brought attention to another collection of nearby fault lines — the Shoreline, Los Osos and San Luis Bay.
All of these discussions of safety are set against a backdrop of shifting sentiment about nuclear energy in the United States.
“Since Three Mile Island and then Chernobyl there has been a political swing against nuclear—since the late 1970s,” Victor told CNBC. “Analysts call this ‘dread risk’ — a risk that some people assign to a technology merely because it exists. When people have a ‘dread’ mental model of risk it doesn’t really matter what kind of objective analysis shows safety level. People fear it.”
SAN LUIS OBISPO, CALIFORNIA -JUNE 30: Anti nuclear supporters at Diablo Canyon anti-nuclear protest, June 30, 1979 in San Luis Obispo, California. (Photo by Getty Images/Bob Riha, Jr.)
Bob Riha Jr | Archive Photos | Getty Images
For citizens who live nearby, the fear is tangible.
“I’ve basically grown up here. I’ve been here all my adult life,” Heidi Harmon, the most recent mayor of San Luis Obispo, told CNBC.
“I have adult kids now, but especially after 9/11, my daughter, who was quite young then, was terrified of Diablo Canyon and became essentially obsessed and very anxious knowing that there was this potential security threat right here,” Harmon told CNBC.
In San Luis Obispo County, a network of loud sirens called the Early Warning System Sirens is in place to warn nearby residents if something bad is happening at the nuclear power plant. Those sirens are tested regularly, and hearing them is unsettling.
“That is a very clear reminder that we are living in the midst of a potentially incredibly dangerous nuclear power plant in which we will bear the burden of that nuclear waste for the rest of our lives,” Harmon says.
Also, Harmon doesn’t trust PG&E, the owner of Diablo Canyon, which has a spotted history. In 2019, the utility reached a $13.5 billion settlement to resolve legal claims that its equipment had caused various fires around the state, and in August 2020 it pleaded guilty to 84 counts of involuntary manslaughter stemming from a fire caused by a power line it had failed to repair.
“I know that PG&E does its level best to create safety at that plant,” Harmon told CNBC. “But we also see across the state, the lack of responsibility, and that has led to people’s deaths in other areas, especially with lines and fires,” she said.
Heidi Harmon, former mayor of San Luis Obispo
Photo courtesy Heidi Harmon
While living in the shadow of Diablo Canyon is scary, she is also well aware of the dangers of climate change.
“I’ve got an adult kid who was texting me in the middle of the night asking me if this is the apocalypse after the IPCC report came out, asking me if I have hope, asking me if it’s going to be okay. And I cannot tell my kid that it’s going to be okay, anymore,” Harmon told CNBC.
But PG&E is adamant that the plant is not shutting down because of safety concerns.
The utility has a team of geoscience professionals, the Long Term Seismic Program, who partner with independent seismic experts to ensure the facility remains safe, Suzanne Hosn, a spokesperson forPG&E, told CNBC.
The main entrance into the Diablo Canyon Nuclear Power plant in San Luis Obispo, Calif., as seen on Tues. March 31, 2015.
Michael Macor | San Francisco Chronicle | Hearst Newspapers via Getty Images
“The seismic region around Diablo Canyon is one of the most studied and understood areas in the nation,” Hosn said. ”The NRC’s oversight includes the ongoing assessment of Diablo Canyon’s seismic design, and the potential strength of nearby faults. The NRC continues to find the plant remains seismically safe.”
A former technical executive who helped operate the plant also vouched for its safety.
“The Diablo Canyon Nuclear Power Plant is an incredible, marvel of technology, and has provided clean, affordable and reliable power to Californians for almost four decades with the capability to do it for another four decades,” Ed Halpin, who was the Chief Nuclear Officer of PG&E from 2012 until he retied in 2017, told CNBC.
“Diablo can run for 80 years,” Halpin told CNBC. “Its life is being cut short by at least 20 years and with a second license extension 40 years, or four decades.”
Local power-buying groups don’t want nuclear
PG&E offered a very different reason for closing Diablo Canyon when it set the wheels in motion in 2016.
According to legal documents PG&E submitted to the California Public Utilities Commission, the utility anticipated lower demand — not for energy in general, but for nuclear energy specifically.
One reason is a growing number of California residents buying power through local energy purchasing groups called community choice aggregators, the 2016 legal documents say. Many of those organizations simply refuse to buy nuclear.
There are 23 local CCAs in California serving more than 11 million customers. In 2010, less than 1% of California’s population had access to a CCA, according to a UCLA analysis published in October. That’s up to more than 30%, the report said.
The Redwood Coast Energy Authority, a CCA serving Humboldt County, strongly prefers renewable energy sources over nuclear, Executive Director Matthew Marshall told CNBC.
“Nuclear power is more expensive, it generates toxic waste that will persist and need to be stored for generations, and the facilities pose community and environmental risks associated with the potential for catastrophic accidents resulting from a natural disaster, equipment failure, human error, or terrorism,” said Marshall, who’s also the president of the trade association for all CCAs in California.
Consequently, the Redwood Coast Energy Authority has refused all power from Diablo Canyon.
There are financial factors at play, too. CCAs that have refused nuclear power stand to benefit financially when Diablo shuts down. That’s because they are currently paying a Power Charge Indifference Adjustmentfee for energy resources that were in the PG&E portfolio for the region before it switched over to a CCA. Once Diablo is gone, that fee will be reduced.
Meanwhile, CCAs are aggressively investing in renewable energy construction. Another CCA in California, Central Coast Community Energy, which also decided not to buy nuclear power from Diablo Canyon, has instead invested in new forms of energy.
PALM SPRINGS, CA – MARCH 27: Giant wind turbines are powered by strong winds in front of solar panels on March 27, 2013 in Palm Springs, California. According to reports, California continues to lead the nation in green technology and has the lowest greenhouse gas emissions per capita, even with a growing economy and population. (Photo by Kevork Djansezian/Getty Images)
“As part of its energy portfolio in addition to solar and wind, CCCE is contracting for two baseload (available 24/7) geothermal projects and large scale battery storage which makes abundant daytime renewable energy dispatchable (available) during the peak evening hours,” said the organization’s CEO, Tom Habashi.
Technically, California’s 2018 clean energy law requires 60% of that zero-carbon energy come from renewables like wind and solar, and leaves room open for the remaining 40% to come from a variety of clean sources. But functionally, “other policies in California basically exclude new nuclear,” Victor told CNBC.
The utility can’t afford to ignore the local political will.
“In a regulated utility, the most important relationship you have is with your regulator. And so it’s the way the politics gets expressed,” Victor told CNBC. “It’s not like Facebook, where the company has protesters on the street, people are angry at it, but then it just continues doing what it was doing because it’s got shareholders and it’s making a ton of money. These are highly regulated firms. And so they’re much more exposed to politics of the state than you would think of as a normal firm.”
Cost uncertainty and momentum
Apart from declining demand for nuclear power, PG&E’s 2016 report also noted California’s state-wide focus on renewables, like wind and solar.
As the percentage of renewables continues to climb, PG&E reasoned, California will collect most of its energy when the sun shines, flooding the electricity grid with surges of power cyclically. At the times when the electricity grid is being turbocharged by solar power, the constant fixed supply of nuclear energy will actually become a financial handicap.
When California generates so much energy that it maxes out its grid capacity, prices of electricity become negative — utilities essentially have to pay other states to take that energy, but are willing to do so because it’s often cheaper than bringing energy plants offline. Although the state is facing well-publicized energy shortages now, that wasn’t the case in 2016.
PG&E also cited the cost to continue operating Diablo, including compliance with environmental laws in the state. For example, the plant was has a system called “once-through cooling,” which uses water from the Pacific Ocean to cool down its reactors. That means it has to pump warmed ocean water back out to the coastal waters near Diablo, which alarms local environmental groups.
Finally, once the wheels are in motion to shut a nuclear plant down, it’s expensive and complicated process to reverse.
Diablo was set on the path to be decommissioned in 2016 and will operate until 2025. Then, the fuel has to be removed from the site.
“For a plant that has been operational, deconstruction can’t really begin until the fuel is removed from the reactor and the pools, which takes a couple years at least,” Victor told CNBC. Only then can deconstruction begin.
Usually, it takes about a decade to bring a nuclear plant offline, Victor told CNBC, although that time is coming down.
“Dismantling a nuclear plant safely is almost as hard and as expensive as building one because the plant was designed to be indestructible,” he said.
Politics favor renewables
All of these factors combine with a political climate that is almost entirely focused on renewables.
In addition to his academic roles, Victor chairs the volunteer panel that is helping to oversee and steward the closing of another nuclear power plant in California at San Onofre. There, an expensive repair would have been necessary to renew the plant’s operating license, he said.
Kern County, CA – March 23: LADWPs Pine Tree Wind Farm and Solar Power Plant in the Tehachapi Mountains Tehachapi Mountains on Tuesday, March 23, 2021 in Kern County, CA.(Irfan Khan / Los Angeles Times via Getty Images)
Irfan Khan | Los Angeles Times | Getty Images
“The situation of Diablo is in some sense more tragic, because in Diablo you have a plant that’s operating well,” Victor said. “A lot of increasingly politically powerful groups in California believe that [addressing climate change] can be done mainly or exclusively with renewable power. And there’s no real place for nuclear in that kind of world.”
“It’s frustrating. It’s something that I’ve spent well in excess of 10,000 hours on this project pro bono,” said Gene Nelson, the legal assistant for the independent nonprofit Californians for Green Nuclear Power.
“But it’s so important to our future as a species — that’s why I’m making this investment. And we have other people that are making comparable investments of time, some at the legal level, and some in working on other policies,” Nelson said.
Even if California can eventually build enough renewables to meet the energy demands of the state, there are still unknowns, Victor said.
“The problem in the grid is not just the total volume of electricity that matters. It’s exactly when the power is available, and whether the power can be turned on and off exactly as needed to keep the grid stabilized,” he told CNBC. “And there, we don’t know.”
“It might be expensive. It might be difficult. It might be that we miss our targets,” Victor told CNBC. “Nobody really knows.”
For now, as California works to ramp up its renewable energy resources, it will depend on its ability to import power, said Mark Z. Jacobson, a professor of Civil and Environmental Engineering at Stanford. Historically, the state has imported hydropower from the Pacific Northwest and Canada, and other sources of power from across the West.
“California will be increasing renewable energy every year from now on,” Jacobson told CNBC. “Given California’s ability to import from out of state, there should not be shortfalls during the buildout.”
The BP logo is displayed outside a petrol station that also offers electric vehicle recharging, on Feb. 27, 2025, in Somerset, England.
Anna Barclay | Getty Images News | Getty Images
BP shares jumped on Wednesday after activist investor Elliott went public with a stake of more than 5% in the struggling British oil major, which has pivoted back to oil in a bid to restore investor confidence.
BP shares were last seen up 4.75% at 9:44 a.m. London time. The London-listed stock price is down around 5% year-to-date.
Hedge fund Elliott Management has built its holding in the British oil major to 5.006%, according to a regulatory filing disclosed late Tuesday. BP’s other large shareholders include BlackRock, Vanguard and Norway’s sovereign wealth fund.
Elliott was first reported to have assumed a position in the oil and gas company back in February, driving a share rally amid expectations that its involvement could pressure BP to shift gears from its green strategy and back toward its core oil and gas businesses.
Within weeks, BP, which has been lagging domestic peer Shell and transatlantic rivals and posted a steep drop in fourth-quarter profit, announced plans to ramp up fossil fuel investments to $10 billion through 2027. This marked a sharp strategic departure for the company, which five years ago became one of the first energy giants to announce plans to cut emissions to net zero “by 2050 or sooner.” As part of that push, the company pledged to slash emissions by up to 40% by 2030 and to ramp up investment in renewables projects.
The oil major scaled back this emissions target to 20% to 30% in February 2023, saying at the time that it needed to keep investing in oil and gas to meet global demand.
Since switching gears, BP’s CEO Murray Auchincloss and outgoing Chair Helge Lund — who is expected to depart the company in 2026 — retained their posts but were penalized with reduced support during BP’s board re-election vote earlier this month amid pressure from both revenue and climate-focused investors.
BP’s strategic reset back to the company’s oil and gas activities took place just as crude prices began to plunge amid volatility triggered by U.S. tariffs and Washington’s trade spat with China, the world’s largest crude importer.
Energy analysts have broadly welcomed the strategic reset, and BP CEO Murray Auchincloss has since said the pivot attracted “significant interest” in the firm’s non-core assets.
The energy firm nevertheless remains firmly in the spotlight as a potential takeover target, with the likes of Shell and U.S. oil giants Exxon Mobil and Chevron touted as possible suitors.
BP is scheduled to report first-quarter earnings on Tuesday. The company has said it anticipates lower reported upstream production and higher net debt in the first quarter than in the final three months of 2024.
Tesla’s earnings report dropped today, and news isn’t great. But instead of recognizing his failures that have led to Tesla’s downturn, CEO Elon Musk lashed out with conspiracy theories while also hypocritically failing to acknowledge that his company was only profitable this quarter due to regulatory credits.
The numbers are in on Tesla’s dismal quarter, with sales, profits and margins tanking significantly for the company despite a rising global EV market.
You’d expect a drop in car sales to be top of mind for a car company, but instead of talking about this, CEO Elon Musk opened the call by talking about his ineffective advisory role to a former reality TV host.
Musk is heading up the self-styled “Department of Government Efficiency,” an advisory group that is focused on reducing redundancy in government. The office is not an actual government department and has a redundant mission to the Government Accountability Office, which is an actual government department focused on reducing government waste.
Advertisement – scroll for more content
Musk originally claimed that the department would be able to save $2 trillion for the US government, which is actually impossible because federal discretionary spending is $1.7 trillion, which is a (gets out abacus) smaller number than $2 trillion.
He has, of course, failed at this task that anyone with any level of competence would have known was impossible before setting it out for themselves, and now projects that the department will save $150 billion next year, less than a tenth of his original estimate. But even that projection is likely an overstatement, given that most of the supposed savings that DOGE has found are not actual savings at all.
On top of this, the US government’s deficit has grown to the second-highest level on record – with the first happening in 2020, the last time Mr. Trump squatted in the White House. Which means the government isn’t saving money, it is in fact borrowing and spending more of it than ever before.
So, Musk’s tenure in the advisory board has been an unmitigated failure by any realistic account.
But if you listened to Tesla’s call, you wouldn’t have known this, as Musk was quite boastful of his efforts – starting a Tesla conference call with an irrelevant rant about his fake government department, instead of with Tesla business.
He claimed that he has made “a lot of progress in addressing waste and fraud” and that the job is “mostly done,” which is not correct by his own metrics. Musk stated that his purpose is “trying to bring in the insane deficit that is leading our country, the United States, to destruction,” and as we covered above, that deficit has only increased.
But he also went on to spew some rather insane conspiracy theories about the reasons behind his company’s recent failures, all of which of course put the blame on someone else, rather than himself. The buck stops anywhere but here, I guess.
His primary assertion was that the “blowback from the time I’ve been spending in government” (which, again, is an advisory role, not an actual government position) has come mainly from protesters that were “receiving fraudulent money” and are now angry that the government money spigot has been turned off.
Which, of course, he’s provided no evidence for… and he’s provided no evidence for it because it’s false.
Besides, that’s not how protests work. But incorrect claims that protests do work that way are often used by opponents of free speech, with the motivation of putting a chilling effect public participation. Fitting behavior for an enemy of the First Amendment like Elon Musk.
Meanwhile, this assertion also comes from a person who tried and failed to bribe voters to win an election. Perhaps his admiration of Tesla protesters is aspirational – he wishes his ideas were good enough to inspire that sort of grassroots political effort that money, demonstrably, cannot buy.
But this hypocrisy extends beyond Musk’s hatred of free expression, and strikes at the heart of the business he is the titular leader of, Tesla, the organization that has made him into the richest man in the world. Because not only is it not true that Tesla protests are driven by his ineffective government actions (they are, in fact, driven by him doing Nazistuffallthetime), it’s also objectively true that Musk’s companies are a large recipient of government money.
And that’s particularly relevant today, to the very earnings call where Musk made his ridiculous assertion, because in Q1 2025, Tesla only turned a profit due to government credits. Without them, it would have lost money.
Tesla only profitable in Q1 due to regulatory credits
Per today’s earnings report, Tesla earned $595 million in regulatory credits in Q1. But its total net income for the quarter was $409 million.
This means that without those regulatory credits, Tesla would have posted a -$189 million loss in Q1. It was saved not just by credit sales, but credit sales which increased year over year – in the year-ago quarter, Tesla made $442 million in regulatory credits, despite having higher sales in Q1 2024 than in Q1 2025. So not only were credits higher, but credits per vehicle were higher.
This is a common feature of Tesla earnings, and we even said in our earnings preview that we expected it. While Tesla had a bad quarter, nobody expected it to become actually unprofitable, because there was always the possibility of increasing regulatory credit sales to eke out a profitable quarter.
And this has been the case many times in Tesla’s past, as well. In earlier times, Tesla’s first few profitable quarters were decried by the company’s opponents as an accounting trick, suggesting that regulatory credit sales weren’t “real” profits, and that the cars should have to stand on their own.
This is a silly thing to say – businesses do business in the environment that exists, and every business has an incentive structure that includes subsidies and externalities. If we were to selectively write off certain profits for certain businesses, we could make a tortured case that any business isn’t profitable.
Plus, these opponents didn’t extend the same treatment to the oil industry, which is subsidized to the tune of $760 billion per year in the US alone in unpriced externalities, yet that is somehow never mentioned during their earnings calls.
But, setting aside the debate over whether credits are valid profits (they are), for years now we’ve been well beyond Tesla’s reliance on credits. The company has produced significant profits, regardless of credit sales, for some time now.
At least, until today. That’s no longer true – Tesla did rely on credits to become profitable in Q1. And Musk starting the call with a ridiculous rant about government handouts not only shows his hypocrisy and projection on this matter, but his detachment from reality itself. He is, truly, too stuck in the impenetrable echo chamber of his self-congratulating twitter feed to realize what an embarrassment he’s being in public – to the point of inventing shadow enemies to explain the very real, very simple explanation that people aren’t buying his company’s cars because he sucks so much.
Charge your electric vehicle at home using rooftop solar panels. Find a reliable and competitively priced solar installer near you on EnergySage, for free. They have pre-vetted installers competing for your business, ensuring high-quality solutions and 20-30% savings. It’s free, with no sales calls until you choose an installer. Compare personalized solar quotes online and receive guidance from unbiased Energy Advisers. Get started here. – ad*
FTC: We use income earning auto affiliate links.More.
No matter how badly a fleet wants to electrify their operations and take advantage of reduced fuel costs and TCO, the fact remains that there are substantial up-front obstacles to commercial EV adoption … or are there? We’ve got fleet financing expert Guy O’Brien here to help walk us through it on today’s fiscally responsible episode of Quick Charge!
This conversation was motivated by the recent uncertainty surrounding EVs and EV infrastructure at the Federal level, and how that turmoil is leading some to believe they should wait to electrify. The truth? There’s never been a better time to make the switch!
New episodes of Quick Charge are recorded, usually, Monday through Thursday (and sometimes Sunday). We’ll be posting bonus audio content from time to time as well, so be sure to follow and subscribe so you don’t miss a minute of Electrek’s high-voltage daily news.
Advertisement – scroll for more content
Got news? Let us know! Drop us a line at tips@electrek.co. You can also rate us on Apple Podcasts and Spotify, or recommend us in Overcast to help more people discover the show.
If you’re considering going solar, it’s always a good idea to get quotes from a few installers. To make sure you find a trusted, reliable solar installer near you that offers competitive pricing, check out EnergySage, a free service that makes it easy for you to go solar. It has hundreds of pre-vetted solar installers competing for your business, ensuring you get high-quality solutions and save 20-30% compared to going it alone. Plus, it’s free to use, and you won’t get sales calls until you select an installer and share your phone number with them.
Your personalized solar quotes are easy to compare online and you’ll get access to unbiased Energy Advisors to help you every step of the way. Get started here.
FTC: We use income earning auto affiliate links.More.