Exclusive: Stellantis Mexico unit okays independent union; U.S. trade probe to end

By Daina Beth Solomon



Workers gather outside the Teksid Hierro de Mexico plant in Ciudad Frontera, Mexico in this handout picture obtained by Reuters on July 20, 2022. Alfonso Torres/Handout via REUTERS

MEXICO CITY, Aug 8 (Reuters) - A Mexican unit of carmaker Stellantis expects to resolve a complaint from Washington in several days, it said after it agreed to recognize an independent union, a move workers attributed to U.S. pressure under a recent trade pact.

Stellantis-owned (STLA.MI) Teksid Hierro de Mexico said the complaint, which alleged rights abuses at an auto parts plant in the northern border state of Coahuila, was set to close without going to a dispute panel.

The U.S. Trade Representative (USTR) is negotiating a remediation plan with Mexico's government on the matter under the 2020 United States-Mexico-Canada Agreement (USMCA), and will provide more information in the coming days, a USTR spokesman said in response to questions from Reuters.

Since 2014, workers at the plant have accused Teksid of colluding with powerful union CTM to block their election of an independent union, The Miners, and closing the USMCA case will mark the end of one of Mexico's longest-running labor conflicts.

In recent weeks, Teksid has recognized The Miners as the rightful union and agreed to re-hire, with back-pay, 36 workers who said they had been fired in retaliation for supporting the independent labor group.

The unit of the Italian-French carmaker would become the fourth company to resolve a USMCA complaint since the first case at a General Motors Co plant in Mexico's Guanajuato state last year.

"We have shown compliance with the points related to the complaint," Teksid told Reuters on Friday, referring to its plant of 1,500 employees that makes iron castings for heavy vehicles.

U.S. labor authorities filed a USMCA complaint over alleged rights abuses on June 6, asking Mexican officials to investigate. read more

On July 11, Teksid and The Miners reached their deal.

The swift action after eight years of conflict illustrated how the Trump-era USMCA has helped Mexican workers oust long-established company-friendly unions in favor of independent groups. Still, the scattershot victories have left Mexico's dominant unions, criticized as too cozy with management, ensconced in most factories.

When asked about the U.S. complaint, Stellantis has said it supports collective bargaining rights and will follow local laws. Mexico's economy and labor ministries did not immediately reply to questions about the U.S. complaint.

Wearing a blue helmet and fresh uniform, Alfonso Torres, 45, took his old spot in the factory on July 21, eight years after being fired.

As time dragged on and other factories refused to hire him, Torres camped outside the plant to demand back the job he began in 1998. Back at work, he said his younger co-workers reminded him the fight for a better union was worth it.

"Do you think we can leave them a salary like the one CTM left?" he asked. "We want something fair."

Torres makes 374 pesos ($18) per day - roughly in line with hourly starting wages for U.S. Stellantis workers.

The USMCA aims to reduce the vast wage gap between U.S. and Mexican workers, and recent raises achieved by independent unions at General Motors and Panasonic after USMCA complaints show it is hitting some of its targets.

Still, wages elsewhere have been largely stagnant even with inflation soaring, and experts say local autoworkers lack the kind of mass leverage that the United Auto Workers has long provided at Detroit carmakers.

Imelda Jimenez, a fired Teksid worker who is now The Miners' political affairs secretary, said the union will soon demand raises yet was on guard to see how Teksid would act without U.S. scrutiny.

The plant could have had tariffs applied on exports if found to be in violation of the USMCA, which has tougher labor rules than the earlier NAFTA.

"They never acted this way before," Jimenez said.

Bolivia's 'Death Road' once haunted drivers. Now it's a wildlife haven


LOS YUNGAS, Bolivia, Aug 8 (Reuters) - Bolivia's decision to open an alternate route to its historic 'Death Road' - a serpentine dirt path across the towering Andes hills known for its deadly cliffs - has led to a resurgence of wildlife in the area, according to an environmental group.

The route was once a key road frequented by heavy trucks connecting Bolivia's capital La Paz to the country's Amazon rainforest. But its deadliness earned it the nickame the 'Death Road.' Between 1999 and 2003 hundreds of Bolivians died trying to navigate it.

By 2007, Bolivia opened an alternate route, leaving the original road as mostly an attraction for cyclists. That not only saved lives but also helped nature, according to a new study by the Wildlife Conservation Society (WCS).

"The fauna, when this road was still functioning, it was being affected by the pollution that vehicles generated, the noise and dust," said Maria Viscarra, a biologist who participated in the study.

A competitor runs during the Bolivia Sky Race on the "Death Road" from Yolosa to Chuspipata, near La Paz, Bolivia, July 29, 2018. REUTERS/David Mercado

The WCS set up 35 camera traps along the route and found 16 species of mammals and 94 species of wild birds.

"Today, heavy haul trucks don't go through this road anymore. Biodiversity has come back to the area and you can see birds like hummingbirds, toucans, parrots," said Guido Ayala, a biologist with the WCS.

While the road is no longer used by many drivers, the route is still dotted with crosses, a way to memorialize those who died on its path.

"It is so nice that we have a place close to the (capital) La Paz, some 50 minutes away, where one can come and see nature in a beautiful way," Ayala added.

Lula's lead narrows to single-digit in Brazil race, poll says
Reuters

Brazil's former president and presidential frontrunner Luiz Inacio Lula da Silva gestures during a campaign event in Sao Paulo, Brazil, August 5, 2022. 

REUTERS/Suamy Beydoun

BRASILIA, Aug 8 (Reuters) - Former President Luiz Inacio Lula da Silva's lead over incumbent Jair Bolsonaro has narrowed to 7 percentage points ahead of the October election, according to a new poll published on Monday.

The leftist leader has the support of 41% of voters against 34% for his far-right adversary, compared to 44% and 31% respectively last month, the BTG/FSB telephone poll said.

Lula's lead has dropped steadily to 7 points from 13 last month and 14 in May, the poll said.

Other polls show Lula's strong lead slipping but maintaining a double-digit advantage: Datafolha saw his advantage at 18-points and a Genial/Quaest poll last week said his lead had fallen to 12 points from 14 points. read more

Lula would still win a second-round runoff against Bolsonaro by 51% to 39% if the vote were today, a 12-point lead that has narrowed from 18 points last month, the BTG/FSB poll said.

Bolsonaro has stepped up social welfare spending, with pay-out of increased monthly stipends to low-income families starting on Tuesday, and he has worked to reduce fuel costs that have spurred inflation, the major complaint from voters.

His negative numbers have come down, with 44% of those surveyed seeing his government as bad or terrible, down from 50% in early June, while 53% say they would never vote for him, compared to 59% in June, the new poll said. Lula's rejection rate has risen marginally to 45% of voters, it said.

The survey by pollster FSB commissioned by investment bank BTG Pactual polled 2,000 people between Aug. 5 and 7 and has a margin of error of 2 percentage points up or down.

U.S. fuel retailers rail against green aviation fuel tax credit
By Laura Sanicola

An ethanol plant with its giant corn silos next to a cornfield in 

Windsor, Colorado July 7, 2006

NEW YORK, Aug 8 (Reuters) - U.S. fuel retailers are fighting the inclusion of a tax credit for sustainable aviation fuel (SAF) in Democrats' $430 billion spending bill, arguing SAF is more carbon intense and less efficient than renewable diesel.

Lawmakers are offering a $1.25-$1.75 per gallon SAF credit depending on the feedstock used, as part of a tax and climate bill that aims to lower U.S. carbon emissions by about 40% by 2030 and cut the federal budget deficit by $300 billion.

The bill is expected to pass the Senate and move to the House with the SAF credit included next week. Democrats control the House and approval with the credit is expected.

Fuel retailers fear the credit would shift vegetable oil and other renewable feedstocks to aviation, leaving less of it for fuel producers that make renewable diesel.

The National Association of Truckstop Operators (NATSO) and SIGMA, a fuel marketers association, are urging lawmakers to oppose the Inflation Reduction Act of 2022 unless it provides tax parity between the biodiesel tax credit (BTC) and proposed SAF tax credit.

A 2021 study from LMC International, an agricultural marketing consultancy, found that SAF production is less efficient at reducing carbon emissions than renewable diesel as more feedstock is required per gallon of output.

"SAF cannot compete with other renewable fuels on an environmental basis," said David Fialkov, executive vice president of government affairs at NATSO.

Other environmental advocates have argued that all biofuels that divert lipid-based feedstocks such as animal fats and waste cooking oils from existing markets present significant sustainability concerns.

"Increasing the global supply of vegetable oils, directly or indirectly, necessarily comes at the cost of forests and other natural lands," according to researchers at the International Council on Clean Transportation in an August briefing.

Airlines have told investors they will increasingly use sustainable aviation fuel made from vegetable oil and other low-carbon feedstocks in an attempt to decarbonize air travel. Due to poor economics, the fuel only represents 0.5% of today's jet fuel pool.

Aviation accounts for 3% of the world's carbon emissions, and is considered one of the toughest areas to cut emissions due to a lack of alternative technologies.

But the White House has vowed to lower aviation emissions by 20% by 2030, with a goal of boosting SAF production to 3 billion gallons per year by 2030, and to meet 100% of aviation fuel demand of about 35 billion gallons a year by 2050.

United States returns to Cambodia 30 antiquities looted from historic sites




Lee Satterfield, Assistant Secretary of State for the Bureau of Educational and Cultural Affairs at the U.S. State Department delivers remarks as he stands with seized items during an announcement of the repatriation and return to Cambodia of 30 Cambodian antiquities sold to U.S. collectors and institutions by Douglas Latchford and seized by the U.S. Attorney’s Office in Manhattan, New York City, U.S., August 8, 2022. REUTERS/Andrew Kelly

NEW YORK, Aug 8 (Reuters) - The United States will return to Cambodia 30 looted antiquities, including bronze and stone statues of Buddhist and Hindu deities carved more than 1,000 years ago, U.S. officials said on Monday.

The Southeast Asian country's archaeological sites -including Koh Ker, a capital of the ancient Khmer empire - suffered widespread looting in civil conflicts between the 1960s and 1990s. Cambodia's government has since sought to repatriate stolen antiquities sold on the international market.

Damian Williams, the top federal prosecutor in Manhattan, said the items being returned were sold to Western buyers by Douglas Latchford, a Bangkok dealer who created fake documents to conceal that the items had been looted and smuggled.

Williams said the antiquities, including a 10th century sandstone statue depicting the Hindu god of war Skanda riding on a peacock, were voluntarily relinquished by U.S. museums and private collectors after his office filed civil forfeiture claims.

"These statues and artifacts ... are of extraordinary cultural value to the Cambodian people," Williams said at a ceremony in Manhattan announcing the return of the antiquities.

U.S. prosecutors in 2019 charged Latchford, a dual citizen of Thailand and the United States, with wire fraud and smuggling over the alleged looting. He died in Thailand in 2020.

The antiquities will be displayed at the National Museum of Cambodia in Phnom Penh, Cambodia's U.S. ambassador Keo Chhea told Reuters at the ceremony.

In 2014, federal prosecutors returned the Duryodhana, a looted 10th-century sandstone sculpture, to Cambodia after settling with auction house Sotheby's Inc, which had acquired it.

Last year, the Manhattan district attorney's office returned 27 looted antiquities to Cambodia.

New Colombian tax bill aims at oil exports to fund social spending

By Nelson Bocanegra and Carlos Vargas
August 8, 2022

Colombia's incoming Finance Minister Jose Antonio Ocampo speaks during an interview with Reuters, in Bogota, Colombia, August 2, 2022. REUTERS/Vannessa Jimenez

BOGOTA, Aug 8 (Reuters) - Colombia's new leftist government on Monday formally proposed a tax reform bill to lawmakers which would raise some 25 trillion pesos ($5.76 billion) in 2023, equivalent to some 1.72% of gross domestic product, in an effort to increase revenue for anti-poverty programs.

Finance Minister Jose Antonio Ocampo said the bill would eventually add some $11.53 billion annually to government coffers, with revenue gradually climbing as the legislation comes into force.

The funds, raised by levying more charges on high-earning individuals and exports of coal and oil, will be directed toward an ambitious agenda of social programs -- including anti-hunger efforts, free public universities, and aid for elderly people without pensions.

"We're seeking to contribute to equality and social justice with a more progressive tax system and also to assign the corresponding resources to government social programs and consolidate the fiscal adjustment that is clearly incomplete," Ocampo told journalists.

"Although there have been advances this year the fiscal deficit remains considerable."

The reform seeks to levy higher taxes on people who earn more than 10 million pesos (some $2,300) monthly - about 2% of Colombia's population. It would instate a permanent wealth tax, and charge a duty on earnings from the sale of shares in companies listed on the stock exchange.

The reform would also levy a 10% tax on exports of coal, oil and gold on income earned when each commodity exceeds a certain price threshold, Ocampo said

The threshold for oil would be $48 per barrel, while coal exports would see the duty levied when prices exceed $87 per tonne. The threshold for gold shipments would be $400 per troy ounce.

The payment of royalties by commodity companies would no longer be deductible from their income tax payments under the bill, Ocampo added.

Oil and coal are the country's top exports and source of royalties. Colombian President Gustavo Petro has promised to bar all new oil development and move the country away from coal production.

The country's mining association said it would comment on the proposal later this week, while the head of the private oil producers' association said it would analyze the bill.

Petro's promises worry some in the market, but Ocampo - a long-time official - has made efforts to assuage those fears, telling Reuters in an interview last week that he will "not do crazy things or allow crazy things." read more

The reform would also tax sugary drinks, highly-processed foods and single-use plastics.

The bill should be presented with an urgency request by the ministry to facilitate its quick passage, said Senate President Roy Barreras, a member of Petro's coalition.

($1 = 4,337.28 Colombian pesos)

Sierra Leone passes new laws to boost landowners' rights

By Umaru Fofana

FREETOWN, Aug 8 (Reuters) - Sierra Leone's parliament on Monday passed two laws that lawyers say will help boost the rights of rural landowners and women against land grabs by big mining and agribusiness firms.

The West African country has a history of sometimes deadly conflict between local communities and foreign companies that have cleared huge tracts of land for palm oil and sugarcane plantations in recent years.

Locals have complained of environmental damage, losing their livelihoods and not being fairly compensated for their land. Under the current system, landowners get an annual rent of $2.5 per acre, which was determined by the state.

The Customary Land Rights Act and the Land Commission Act, both enacted on Monday, empower local landowners to negotiate the value of their land with investors and prevent it being leased out without their express consent.

Campaigners and locals praised the move, while one palm oil company executive said it would spell the end of investment.

"To our knowledge there is not a legal regime anywhere, in either hemisphere that grants such robust rights to communities facing harm," said Eleanor Thompson of Namati, an international legal advocacy group.

A director of SOCFIN , the biggest agribusiness company in Sierra Leone, called it a "dream of NGOs".

"Certainly it will block any investment... It makes things very expensive and we are all prone to enormous blackmail by various communities," Gerben Haringsma added.

The Luxembourg-based company has invested more than $150 million in palm oil farming in Sierra Leone. It has also frequently clashed with local landowners.

Lands Minister Turad Senessie said the new laws would encourage investment by ensuring peace and order.

"This is a win-win situation for both business and Sierra Leoneans including rural landowners," he told Reuters.

One of the laws will also end a colonial-era provision that bars descendants of freed slaves from owning land outside the capital, Freetown.

Analysis: Climate change, scarcity chip away at degrowth taboo

By Federica Urso and Mark John
August 8, 2022

Smoke billows after a wild fire, in Leiria, Portugal July 13, 2022. 

REUTERS/Rodrigo Antunes/File Photo

Summary

Fifty years since advent of degrowth theory

Long shunned, receives new attention

Climate change focuses debate on cutting consumption

Aug 8 (Reuters) - Degrowth - the idea that a finite planet cannot sustain ever-increasing consumption - is about the closest you can get to a heresy in economics, where growth is widely held as the best route to prosperity.

But, as climate change accelerates and supply chain disruptions offer rich-world consumers an unaccustomed taste of scarcity, the theory is becoming less taboo and some have started to ponder what a degrowth world might look like.

After the U.N. climate science agency this year called for cuts in consumer demand - a core degrowth premise - the think tank that runs the Davos forum published a degrowth primer in June and the issue has even begun to crop up in investment notes.

"It is a provocative term," Aniket Shah, Global Head of ESG and Sustainability Strategy at Jefferies said of the New York-based bank's June 13 note on the "Degrowth Opportunity".

"But it's not about going to a low-income country saying 'You can't grow anymore'," he said. "It's saying: We need to look at the entire system and see how do we over time decrease total consumption and production in aggregate."

First coined in its French guise "décroissance" in 1972, the theory gained backers after the "Limits To Growth" report in the same year described a computer simulation by MIT scientists of a world destabilised by growing material consumption.

Controversial from the start, that simulation has been attacked as flawed by some and applauded by others as uncannily prescient in its prediction of accelerating planetary stress.

In recent decades, the world's economy has grown faster than the carbon emissions it generates. But this partial decoupling has been nowhere near enough to halt or reverse those emissions, allowing them to drive global warming further.

In April, the Intergovernmental Panel on Climate Change (IPCC) concluded that outright cuts to consumer demand were needed to reduce carbon emissions, a shift from a previous focus on the promise of sustainable fuel technology.

Reuters Graphics

The IPCC's biodiversity counterpart IPBES last month included degrowth among a number of alternative economic models with insights that could help to arrest environmental degradation.

"In the plenary, even the word 'degrowth' wasn't challenged. That's very interesting," IPBES report co-chair Unai Pascual told Reuters of conclusions that won approval from 139 member countries, including China, India, Russia and the United States.

The article on degrowth published in June by Davos-organiser the World Economic Forum hinted at degrowth impacts, suggesting "it might mean people in rich countries changing their diets, living in smaller houses and driving and travelling less".

GUNG-HO ON GROWTH

For Jefferies' Shah, it is such behavioural changes that could inspire a degrowth-aligned investment portfolio.

"Would Zoom for example ever want to be called a degrowth stock? I doubt it. But I can certainly see how a world that uses more web-conferencing ... means less travel, which is a very high-carbon-intensive way of transportation," said Shah.

It is easy to see how other products and services, such as mobility- and fashion-sharing, technologies that allow a transition from fossil fuel to renewable energy, or even just bicycles, could find a place in a hypothetical degrowth fund.

But how far ESG funds and the companies in which they invest are ready to align with degrowth is open to question given how the theory explicitly prioritises societal, environmental and other non-financial values over profit-making.

"Degrowth is really about true sustainability," Jennifer Wilkins, a researcher on emerging business sustainability issues whose work was featured in the Jefferies note, told Reuters.

"It's about delivering what is needed in terms of meeting human needs, within planetary boundaries. And current ESG investors don't really understand planetary boundaries," she said, adding their focus remained "what impacts the business".

That perhaps is not surprising.

Some countries have tried to measure economic outcomes differently - the tiny Himalayan kingdom of Bhutan famously devised a "gross national happiness" index and Japan is looking into developing a "green GDP" measurement.

But still, economic policy and markets overwhelmingly run on the dual track of increasing consumption and production.

Tim Jackson, an economist who has long critiqued that model, said the current debate on growth was "very, very confused", with different strands of thought vying for supremacy.

He pointed to the UK Conservative Party leadership contest - a race that will decide who replaces Boris Johnson as prime minister - as an example of what he called a "gung-ho" focus on economic growth as an unchallenged priority.

On the other hand, he said, more ecologically-minded politicians across Europe and beyond were receptive in private to arguments around limits to growth but "want to find other ways to talk about it that don't scare the horses".

Jackson, author of the 2009 book "Prosperity Without Growth", said the pandemic lockdowns of 2020 and this year's Western sanctions on Russia had both challenged consumption with other priorities, namely health safety or geopolitical goals.

At the same time, some countries - for a variety of reasons ranging from demographic ageing to trade protectionism or lack of reform - could enter something akin to a "post-growth" state where their economies show little if any expansion.

That is a fate Japan has experienced with its "lost decades" and which some analysts see as a risk for Germany unless it quickly revamps its decades-old export-led economic model and shores up its vulnerability to energy shocks.

"Particularly in the advanced economies we are moving into a situation where to all intents and purposes, we're pretty much not looking at continued growth already," said Jackson.

"If we haven't got an economics that will deal with that .. then we've got very little chance of managing it successfully."

Additional reporting by Gloria Dickie and Vincent Flasseur in London; Kantaro Komiya and Daniel Leussink in Tokyo; editing by Barbara Lewis

Ukrainian risks her life to rescue wild animals from war
By HANNA ARHIROVA

yesterday

1 of 8

Natalia Popova, 50, pets a lion at her animal shelter in Kyiv region, Ukraine, Thursday, Aug. 4, 2022. Popova, in cooperation with the animal protection organisation UA Animals, has already saved more than 300 animals from the war, 200 of them were sent abroad, and 100 found a home in most western regions of Ukraine, which are considered to be safer. (AP Photo/Efrem Lukatsky)

CHUBYNSKE, Ukraine (AP) — Natalia Popova has found a new purpose in life: Rescuing wild animals and pets from the devastation wrought by the war in Ukraine.

“They are my life,” says the 50-year-old, stroking a light-furred lioness like a kitten. From inside an enclosure, the animal rejoices at the attention, lying on her back and stretching her paws up toward her caretaker.

Popova, in cooperation with the animal protection group UA Animals, has already saved more than 300 animals from the war; 200 of them went abroad and 100 found new homes in western Ukraine, which is considered safer. Many of them were wild animals who were kept as pets at private homes before their owners fled Russian shelling and missiles.

Popova’s shelter in the Kyiv region village of Chubynske now houses 133 animals. It’s a broad menagerie, including 13 lions, a leopard, a tiger, three deer, wolves, foxes, raccoons and roe deer, as well as domesticated animals like horses, donkeys, goats, rabbits, dogs, cats and birds.

The animals awaiting evacuation to Poland were rescued from hot spots such as eastern Ukraine’s Kharkiv and Donetsk regions, which see daily bombardments and active fighting. The Ukrainian soldiers who let Popova know when animals near the front lines need help joke that she has many lives, like a cat.

“No one wants to go there. Everyone is afraid. I am also scared, but I go anyway,” she said.

Often she is trembling in the car on her way to rescue another wild animal.

“I feel very sorry for them. I can imagine the stress animals are under because of the war, and no one can help them,” Popova said.

In most cases, she knows nothing about the animals she rescues, neither their names and ages nor their owners.

“Animals don’t introduce themselves when they come to us,” she joked.

For the first months of the war, Popova drove to war hot spots alone, but a couple from UA Animals recently offered to transport and help her.

“Our record is an evacuation in 16 minutes, when we saved a lion between Kramatorsk and Sloviansk,” Popova said. An economist by education with no formal veterinary experience, she administered anesthesia on the lion because the animal had to be put to sleep before it could be transported.

Popova says she has always been very attached to animals. In kindergarten, she built houses for worms and talked to birds. In 1999, she opened the first private horse club in Ukraine. But it wasn’t until four years ago that she saved her first lion.

An organization against slaughterhouses approached her with a request for help saving a lion with a broken spine. She did not know how she could help because her expertise was in horses. But when she saw a photo of the big cat, Popova could not resist.

She built an enclosure and took in the lion the next morning, paying the owner. Later, Popova created a social media page titled “Help the Lioness,” and people began to write asking for help saving other wild animals.

Yana, the first lioness she rescued, has become a family member since she could not find a new home due to a disability. Popova took care of her until she died two weeks ago.

The shelter is just a temporary stop for the animals. Popova rehabilitates them and then looks for new homes for them. She feels a special connection with each big cat, but says she does not mind letting them go.

“I love them, and I understand that I do not have the resources to provide them with the comfortable life they deserve,” says Popova.

At first, she bankrolled the shelter with her own funds from the horse business. But since Russia invaded Ukraine on Feb. 24, the horse business has not been profitable. With more than $14,000 a month needed to keep animals healthy and fed, she has turned to borrowing, and seen her debt grow to $200,000.

She gets some money from UA Animals and from donations, but worries about how to keep everything together have kept her up at night.

“But I will still borrow money, go to hot spots and save animals. I can’t say no to them,” she said.

Popova sends all her animals to the Poznań Zoo in Poland, which helps her evacuate them and find them new homes. Some animals have already been transported to Spain, France and South Africa. Her next project is sending 12 lions to Poland this week.

With no end to the fighting in sight, Popova knows she will still be needed.

“My mission in this war is to save wild animals,” she says.

___

Follow all AP stories on the war in Ukraine at https://apnews.com/hub/russia-ukraine.

Not so fast: California’s last nuke plant might run longer

By MICHAEL R. BLOOD

yesterday

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The Diablo Canyon Nuclear Power Plant, south of Los Osos, Calif., is viewed Sept. 20, 2005. California's last operating nuclear power plant could get a second lease on life. Owner Pacific Gas & Electric decided six years ago to close the twin-domed power plant by 2025. But Democratic Gov. Gavin Newsom, who was involved in the agreement to close the reactors, has prompted PG&E to consider seeking a longer lifespan for the plant. (AP Photo/Michael A. Mariant, File)


LOS ANGELES (AP) — An aggressive push toward renewable energy has run headlong into anxiety over keeping the lights on in California, where the largest utility is considering whether to try to extend the lifespan of the state’s last operating nuclear power plant.

California is the birthplace of the modern environmental movement that for decades has had a fraught relationship with nuclear power, which doesn’t produce carbon pollution like fossil fuels but leaves behind waste that can remain dangerously radioactive for centuries.

Now environmentalists find themselves at odds with someone they usually see as an ally: Democratic Gov. Gavin Newsom, a green energy advocate who supported the 2016 agreement calling for the Diablo Canyon Nuclear Power Plant to close by 2025 but now is a leading voice to consider a longer operating run.

Newsom often is mentioned as a possible presidential candidate and an attorney for a consumer advocacy group that routinely challenges plant operator Pacific Gas & Electric in rate cases believes “national political ambitions” are at play.

The push to keep Diablo Canyon running “is clearly coming from the governor’s office,” said Matthew Freedman of The Utility Reform Network. Newsom “is mindful that problems with electric system reliability can become a political liability and he is determined to take all possible actions to avoid any possibility that the lights go out in California.”

Newsom certainly wants to avoid a repeat of August 2020, when a record heat wave caused a surge in power use for air conditioning that overtaxed the electrical grid. There were two consecutive nights of rolling blackouts affecting hundreds of thousands of residential and business customers.

In a statement, Newsom communications director Erin Mellon didn’t address the question of politics but said the governor is focused on maintaining reliable energy for households and businesses while accelerating state efforts to meet his aggressive goals for reducing carbon pollution. He continues to support shuttering Diablo Canyon “in the long term.”

The debate over the plant comes as the long-struggling nuclear industry sees climate change as a reason for optimism. President Joe Biden has embraced nuclear power generation as part of his strategy to halve greenhouse gas emissions by 2030, compared to 2005 levels.

Nuclear power provides roughly one-fifth of the electricity in the country, though generation produced by the industry has dropped since 2010. Saving a plant in green energy-friendly California would carry symbolic weight but the window to make an abrupt turnaround appears narrow.

PG&E CEO Patricia “Patti” Poppe told investors in a call last month that state legislation would have to be enacted by September to open the way for PG&E to reverse course. She said the utility faced “a real sense of urgency” because other steps would be required to keep the plant running, including ordering more reactor fuel and storage casks for housing spent fuel that remains highly radioactive.

Extending the plant’s operating life “is not an easy option,” Poppe said. “The permitting and relicensing of the facility is complex and so there’s a lot of hurdles to be overcome.”

The plant on the coast midway between Los Angeles and San Francisco produces 9% of the electricity for California’s nearly 40 million residents. The state earlier set aside up to $75 million to extend operation of older power plants scheduled to close, but it’s not yet clear whether taxpayers might be covering part of the bill — and, if so, how much — to keep Diablo running.

The Newsom administration has been pushing to expand clean energy, as the state aims to cut emissions by 40% below 1990 levels by 2030. California installed more clean energy capacity in 2021 than in any other year in state history, administration officials say, but they warn reliability remains in question as temperatures rise amid climate change.

For Diablo Canyon, the issue is whether the Newsom administration, in concert with investor-owned PG&E, can find a way to unspool the 2016 closure agreement agreed to by environmentalists, plant worker unions and the utility. The decision to close the plant also was endorsed by California utility regulators, the Legislature and then-Democratic Gov. Jerry Brown.

Plant workers now support keeping the reactors open for an extended run while anti-nuclear activists and environmentalists have rejoined a battle they thought was settled six years ago.

“It only makes sense keeping Diablo open,” said Marc D. Joseph, an attorney for the Coalition of California Utility Employees, which represents plant workers. “There is no one involved who wants to see carbon emissions in California go up.”

Critics question if it’s feasible — or even legal — for the utility to break the agreement.

“I don’t know how to unwind it, and I don’t think it should be unwound,” said Ralph Cavanagh of the Natural Resources Defense Council, one of the groups that negotiated and signed the pact.

Friends of the Earth, another signatory of the deal, would oppose any effort to extend the reactors’ operating span. “None of the conditions have changed to pull back on that agreement,” said the group’s president, Erich Pica.

There’s also concern about the aging plant’s safety. Construction at Diablo Canyon began in the 1960s and critics say potential shaking from nearby earthquake faults not recognized when the design was first approved — one nearby fault was not discovered until 2008 — could damage equipment and release radiation.

Lifting the agreement would place “huge numbers of people at great, great risk. That’s what’s at stake here,” said Daniel Hirsch, retired director of the program on environmental and nuclear policy at the University of California, Santa Cruz, and a longtime critic of nuclear plant safety.

PG&E, which has long said the plant is seismically safe, hasn’t said much about whether it will push to extend operations beyond 2025. It is assessing that possibility while continuing to plan for closing and dismantling the plant “unless those actions are superseded by new state policies,” PG&E spokesperson Suzanne Hosn said in a statement.

PG&E is considering applying for a share of $6 billion in federal funding the Biden administration established to rescue nuclear plants at risk of closing. The utility announced the move after Newsom suggested a longer operating run would help the state deal with potential future electricity shortages.

The Energy Department recently recast rules at the request of the Newsom administration that could open the way for an application from Diablo Canyon. But some environmentalists question if those changes conflict with the federal law that provided the funds.

As part of the closure deal, the state granted PG&E a short-term lease for submerged ocean water intake and discharge structures through 2025, which also would have to be extended to keep the plant operating.

Factors cited in the lease agreement echo language in the closing pact, including that the utility would not seek an extended operating license and PG&E was expected to use that period through 2025 to develop a portfolio of greenhouse gas-free renewables and efficiencies to replace Diablo Canyon’s power.

PG&E said in a statement it has met its replacement power requirements to date.

PG&E’s decision to close Diablo Canyon came at a time of rapid change in the energy landscape.

With heavily Democratic California prioritizing renewables to meet future power demand, the utility predicted there would reduced need for power from large plants like Diablo Canyon after 2025. There was even the risk of too much power generation.

Rather than too much power, state officials have warned of possible electricity shortages this summer as a warming climate creates more demand for power, wildfires sometimes incinerate power lines and a long-running drought has reduced hydropower. An emerging tariff dispute — involving products assembled in Malaysia, Thailand, Vietnam and Cambodia using parts and components from China — has delayed solar and storage projects, administration officials say.

But environmentalists argue that a nuclear plant — generating large amounts of power continuously — is not a solution to fill occasional gaps, such as when solar dips after the sun sets.

Reliable electricity “is not a 24/7 problem,” said Cavanagh, of the NRDC. “The last thing you want to solve a problem like that is a giant machine that has to operate 24/7 in order to be economic.