SAN DIEGO (CN) – San Diego Gas & Electric Co. blames Mitsubishi for the planned decommissioning of the San Onofre Nuclear Generating Station, claiming the Japanese company made and sold it $135 million worth of steam generators that began leaking radioactive coolant in their first year of service.
SDG&E on July 18 sued Mitsubishi Heavy Industries and Mitsubishi Nuclear Energy Systems in Superior Court, for fraud, negligence, breach of contract and other charges.
The same day, Southern California Edison (SCE), the majority owner of San Onofre, served the two companies with a notice of dispute .
SDG&E and the City of Riverside are minority owners of the plant, which is north of San Diego on the coast. The plant provided energy to 1.4 million homes in Southern California.
The Wall Street Journal last week estimated that losses from the plant’s closure could come to more than $4 billion.
Edison contracted with the Japanese multinational in 2007 to design and deliver two replacement steam generators, SDG&E says in its lawsuit. It says Mitsubishi Heavy Industries beat out five other bidders for the job. Mitsubishi promised the generators would be good for 40 years, and would not wear for 20 years, according to the complaint.
Wear of tube walls inside older steam generators was an issue at the San Onofre plant. When steam generators “exceed a threshold level of wear,” the tube walls are repaired to plug water leaks that may cool reactors, the complaint states.
“When plugged, the tubes no longer heat the feedwater, which produces less steam, thus reducing the amount of power produced by the turbine which connects to a generator that produces electricity from the unit,” according to the complaint.
SDG&E says that the new generators, the largest ever built for a U.S. nuclear power plant, were “not like-for-like replacements.”
Edison was concerned that tubes in larger generators could wear more rapidly, and asked if it could form a joint task force with Mitsubishi to oversee the new design.
“Mitsubishi refused to do so because of the risks involved in revealing its design to an industry competitor,” the complaint states.
SDG&E claims one of the two nuclear reactors shut down after a tube in the Mitsubishi-designed generators leaked, on Jan. 31, 2012. That was less than one year after it became operational, according to the lawsuit.
After the Nuclear Regulatory Commission found the new generators non-compliant, Mitsubishi said it would take at least one year to replace them, SDG&E says.
One solution involved inserting thicker anti-vibration bars into the generators, but SDG&E claims Mitsubishi has “not provided adequate scientific evidence that the plan would function safely, effectively, or that it would be approved by the NRC [Nuclear Regulatory Commission].”
Edison announced in June that it would permanently retire the two nuclear reactors.
Mitsubishi Nuclear Energy Systems spokeswoman Kathy Horvat called SDG&E an “inappropriate plaintiff in the wrong legal forum.” She said Mitsubishi’s contract is with Edison as the plant owner, and the “appropriate dispute resolution process” will decide the matter.
“Mitsubishi’s liability to SCE [Southern California Edison] and its co-owners is limited by the contractual provisions to which the parties agreed, as SCE has disclosed in its filings with the U.S. Securities and Exchange Commission, and includes an overall limitation of liability (approximately US $137 million) as well as a preclusion of consequential damages, including the cost of replacement power,” Horvat wrote in an email.
SDG&E seeks rescission of the purchase order; compensatory, incidental, exemplary and punitive damages, and an order forcing Mitsubishi to indemnify SDG&E.
SDG&E is represented by Gregory Long with Sheppard, Mullin, Richter & Hampton, of Los Angeles.
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