Cambridge, MA, May 26, 2026 (GLOBE NEWSWIRE) -- As California legislators weigh whether to extend the operating life of the Diablo Canyon Nuclear Power Plant (DCPP) beyond 2030, new research from the MIT Sloan School of Management finds that keeping the plant running through 2045 could save state ratepayers more than $7.6 billion, and potentially more than $20 billion, compared to alternative resource portfolios currently under consideration.
Further, the research shows DCPP would displace capacity from existing natural gas power plants, offering California the opportunity to deploy in-state renewable resources more economically, and delay the need for costly transmission upgrades.
The working paper, “The Economics of Continued Operation of the Diablo Canyon Nuclear Power Plant, 2030–2045,” was authored by John Parsons, deputy director of research at the MIT Center for Energy and Environmental Policy Research (CEEPR), and a senior lecturer at MIT Sloan School of Management. The research was supported by a gift from the Clean Air Task Force.
Parsons will break down his research and answer questions related to his findings during a webinar to be hosted by MIT CEEPR on Thursday, June 4 at noon-1pm Pacific Time. To attend, please register here.
Research analyzes three scenarios
Parsons’ research analyzes three scenarios developed by the California Public Utilities Commission (CPUC) using results from its RESOLVE capacity expansion and dispatch model. RESOLVE is an electricity resource planning model that identifies optimal long-term electric generation and transmission investments subject to reliability, policy, and technical constraints.
“Diablo Canyon provides reliable, relatively low-cost generation that is increasingly valuable as California’s electricity demand grows,” said Parsons. “At a time when electricity rates are among the highest in the continental U.S. and continue to rise, this analysis shows that extending the plant’s operating life can help California meet its clean energy goals faster—while delivering significant savings to ratepayers.”
Savings depend on the alternative
The research evaluates cost savings under comparisons of modeling data reported by the CPUC for its 2024-2026 Integrated Resource Planning Process:
- A Least Cost Case, which optimizes all investments beyond the Baseline used for CPUC’s modeling but excludes DCPP as an option
- A proposed Base Case, which adds to the baseline certain procurements related to Assembly Bill 1373, but also excluding DCPP as an option
- DCPP Extension Case, which adds to the baseline the life extension of DCPP to 2045 and optimizes all remaining investments
When the DCPP Extension Case is compared against the Least-Cost Case, extending the plant’s operating life yields present-value savings of more than $7.6 billion, or roughly $500 million per year.
The savings are larger when the DCPP Extension Case is measured against the Base Case, which includes mandated procurements of offshore wind and long-duration storage. The present-value savings from keeping Diablo Canyon online exceed $20 billion, or more than $1.3 billion per year, primarily by avoiding the cost of offshore wind capacity at Morro Bay and Humboldt Bay.
Whether DCPP continues in operation or not, renewables will play a dominant role in California's electricity system. Solar, wind, storage, and geothermal continue to provide more than 90 percent of the state's generation in 2045 across all modeled scenarios.
How the plant reshapes the grid
When Diablo Canyon remains in operation, the RESOLVE modeling shows the state needs less new solar capacity, less battery storage, and can displace existing natural gas plants sooner than it otherwise could. The plant's 18 terawatt-hours of annual generation, all carbon-free, displaces the need for a range of new investments and avoids between 2.4 and 4.8 gigawatts of transmission upgrades depending on the scenario.
The report also validates the cost inputs used in the RESOLVE model, drawing on PG&E's regulatory filings and nine years of historical data from the plant's Federal Energy Regulatory Commission reports. Both the fixed operating costs and fuel costs assumed by the CPUC align closely with observed data, lending confidence to the savings estimates.
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Casey Bayer MIT Sloan School of Management 914.584.9095 bayerc@mit.edu Patricia Favreau MIT Sloan School of Management 617.595.8533
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