What will happen to the housing market when we lose the largest non-government employer in San Luis Obispo County?
There is no way around it. San Luis Obispo County’s economy with be severely impacted when Diablo Canyon Nuclear Power Plant eventually closes. High paying jobs will be lost, tax revenue will shrink, and secondary businesses and services dependent on Diablo Canyon will lose revenue. But, what will happen to the housing market when we lose the largest non-government employer in San Luis Obispo County?
The Basic Facts:
The original 40 year operating license of Diablo Canyon’s two nuclear reactors expire in 2025 and 2026 respectively. Diablo Canyon is petitioning the NRC to extend their licenses for another 20 years until 2045 and 2046.
Diablo Canyon employs over 1,500 residents paying direct wages of over $203 million dollars annually. A 2013 study by Cal Poly estimated Diablo Canyon’s contributions to the Central Coast economy at $920 million.
Forecasting the Impact:
Forecasting the changes in the housing market is a combination of science and luck on a good day. Pinpointing the exact effects of a change of this magnitude is speculative at best. If we assume that most of the 1,500 local Diablo Canyon employees live in different houses, around 1,450 homes would be emptied over a short period of time if the plant closed. We could assume that most employees could not find similar work for similar pay in this area and would need to relocate to another area. In the past, San Luis Obispo County has averaged 1,300 new home construction each year since 1990.
A huge increase in the number of homes for sale will likely depress property values. There would also be a temporary drop in housing prices as the excess inventory is absorbed. These factors would cause a major drop in new home construction, a major local source of employment. The drop in home prices would cause huge disruptions in the local economy.
Which Side of the Fence are you on?
Closing down Diablo Canyon will cause obvious fiscal impact to the county and to the housing market. Diablo Canyon has been a steady and constant economic supporter to the county for over 40 years. The power plant will eventually be shut down. The real question is how with the county fare when the inevitable occurs in either 9 years or 29 years. Will we have an alternative in place to soften the blow or will we just brace for impact?
Here are the main arguments of the Diablo Canyon Detractors and Supporters
What Diablo Canyon’s detractors say:
- The location of Diablo Canyon is unsafe due to several nearby active fault lines.
- “Diablo Canyon is surrounded by faults capable of creating ground motion beyond that for which the reactors and their components were tested and licensed” Source: Friends of the Earth
- The water cooling process for the reactors adversely affects local sea life.
- “The plant draws in an estimated 2.5 billion gallons of water per day for cooling purposes and discharges that water back into the Pacific Ocean about 20 degrees hotter” Source: Friends of the Earth
- Diablo Canyon is too expensive to run and should be shut down in favor more environmentally friendly sources of energy like wind and solar energy.
- “Diablo Canyon nuclear power plant too expensive to operate and called for its replacement with cheaper and more reliable renewable energy sources, by 2018. The combined cost of the plant had ballooned to $5.52 billion. PG&E has grossly underestimated the costs of operating Diablo Canyon in the future and has seriously overestimated the costs of alternative, especially renewable, resources that could replace the energy that Diablo currently provides.” Source: Friends of the Earth
What Diablo Canyon Supporters say:
- Diablo Canyon’s original design and ongoing safety modifications allow the plant to safely withstand earthquakes, tsunamis, and flooding that could potentially occur in the region.
- “The NRC said the safety of the plant is not in question — for a simple reason: Diablo Canyon was indeed designed, and certified by the NRC, to withstand much harder shaking than the DDE’s 0.4 g. New and extensive scientific re-evaluations performed at the direction of the Nuclear Regulatory Commission (NRC) continue to show that Diablo Canyon can safely withstand earthquakes, tsunamis and flooding that could potentially occur in the region.” Source: PGE.com
- Diablo Canyon does have some impact on marine life, but not as much as you might think.
- “Diablo Canyon’s impact on adult fish is trivial: about 5,000 a year, weighing all of 710 pounds, are “impinged” against the screens on the water intake pipes — barely enough for a busy weekend at a seafood restaurant. “Entrainment” is another matter; about 1.5 billion fish eggs and larvae pass through the screens into the plant’s maw each year. Studies suggest that hundreds of thousands of baby fish that would have made it to adulthood are killed by the plant each year. But it pales beside the tens of millions of adult fish killed each year by California’s coastal fishing industry.” Source: The Breakthrough
- The cost incurred by the state of California would be far greater if the Diablo Canyon were shut down.
- Diablo Canyon provides 22 percent of our clean energy — enough for three million people. Diablo provides twice as much electricity as all of California’s solar panels, and one-quarter as much as all of its wind turbines. If closed, California will become dangerously dependent on natural gas — and carbon emissions will rise the equivalent of adding two million cars to the road. Pacific Gas & Electric (PG&E) says it costs $0.05-0.06/kilowatt-hour (KWh). PG&E sells electricity to its retail customers starting at $.16/KWh. That means Diablo makes PG&E approximately $2 billion per year. Source: Save Diablo Canyon
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