PG&E 2008 Annual Report Download - page 126

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Because the DOE failed to develop a permanent storage
site, the Utility obtained a permit from the NRC to build
an on-site dry cask storage facility to store spent fuel through
at least 2024. After various parties appealed the NRC’s issu-
ance of the permit, the U.S. Court of Appeals for the Ninth
Circuit (“Ninth Circuit”) issued a decision in 2006 requiring
the NRC to issue a supplemental environmental assessment
report on the potential environmental consequences in
the event of terrorist attack at Diablo Canyon, as well as
to review other contentions raised by the appealing parties
related to potential terrorism threats. In August 2007,
the NRC staff issued a fi nal supplemental environmental
assessment report concluding there would be no signifi cant
environmental impacts from potential terrorist acts directed
at the Diablo Canyon storage facility.
In October 2008, the NRC rejected the fi nal contention
that had been made during the appeal. The appellant
has fi led a petition for review of the NRC’s order in the
Ninth Circuit. Although the appellant did not seek to
obtain an order prohibiting the Utility from loading spent
fuel, the petition stated that they may seek a stay of fuel
loading at the facility. On December 31, 2008, the appellate
court granted the Utility’s request to intervene in the
proceeding. All briefs by all parties are scheduled to be
fi led by April 8, 2009.
The cost of debt and equity securities sold is determined
by specifi c identifi cation. The following table provides a
summary of the activity for the debt and equity securities:
Year ended December 31,
(in millions) 2008 2007 2006
Proceeds received from sales of securities $1,635 $830 $1,087
Gross realized gains on sales of
securities held as available-for-sale 30 61 55
Gross realized losses on sales of
securities held as available-for-sale (142) (42) (29)
SPENT NUCLEAR FUEL
STORAGE PROCEEDINGS
As part of the Nuclear Waste Policy Act of 1982, Congress
authorized the U.S. Department of Energy (“DOE”) and
electric utilities with commercial nuclear power plants
to enter into contracts under which the DOE would be
required to dispose of the utilities’ spent nuclear fuel and
high-level radioactive waste no later than January 31, 1998,
in exchange for fees paid by the utilities. In 1983, the DOE
entered into a contract with the Utility to dispose of nuclear
waste from the Utility’s two nuclear generating units at
Diablo Canyon and its retired nuclear facility at Humboldt
Bay. The DOE failed to develop a permanent storage site
by January 31, 1998. The Utility believes that the existing
spent fuel pools at Diablo Canyon (which include newly
constructed temporary storage racks) have suffi cient capacity
to enable the Utility to operate Diablo Canyon until approx-
imately 2010 for Unit 1 and 2011 for Unit 2.
The following table provides a summary of the fair value of the investments held in the Utility’s nuclear decommission-
ing trusts:
Total Total
Amortized Unrealized Unrealized Estimated(1)
(in millions) Maturity Date Cost Gains Losses Fair Value
Year ended December 31, 2008
U.S. government and agency issues 2009-2038 $ 617 $103 $ — $ 720
Municipal bonds and other 2009-2049 187 3
(12) 178
Equity securities 588 340 (27) 901
Total $1,392 $446 $(39) $1,799
Year ended December 31, 2007
U.S. government and agency issues 2008-2037 $
767 $ 59 $ — $ 826
Municipal bonds and other 2008-2049 209 5 — 214
Equity securities 464 682 (7) 1,139
Total $ 1,440 $ 746 $ (7) $ 2,179
(1) Excludes taxes on appreciation of investment value.