More than a year after they were initially shut down, Edison International (NYSE:EIX) announced today that it will permanently retire Units 2 and 3 of its San Onofre Nuclear Generating Stations (SONGS ) in California.
The two units were initially shut down in January 2012 after a leak was discovered in one of the unit's steam generators. The generators were manufactured by Mitsubishi Heavy Industries, from whom Edison says it plans to seek damages. In the meantime, the company expects to take a second-quarter post-tax hit between $300 million and $425 million.
"SONGS has served this region for over 40 years," said Chairman and CEO Ted Craver in a statement, "but we have concluded that the continuing uncertainty about when or if SONGS might return to service was not good for our customers, our investors, or the need to plan for our region's long-term electricity needs."
After several months of tests, Edison had originally intended to restart one of the units at least temporarily, but recent rulings by the Nuclear Regulatory Commission made the utcome uncertain. Faced with higher risks and mounting costs, Edison ultimately concluded its time and money would be better spent planning for replacement generation and transmission infrastructure.
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