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Edison starts legal fight with maker of faulty San Onofre generators

Southern California Edison files a formal notice of dispute with Mitsubishi Heavy Industries of Japan and its U.S. subsidiary.

July 18, 2013|By Marc Lifsher
  • Damages related to the failed steam generators that led to the closure of the San Onofre nuclear power plent could top $2 billion, according to Southern California Edison’s most recent estimate.
Damages related to the failed steam generators that led to the closure of… (Gregory Bull, Associated…)

SACRAMENTO — Southern California Edison Co. has started legal action against the manufacturer of steam generators that failed and forced the permanent closure in June of the San Onofre nuclear power plant on the northern San Diego County coast.

As expected, the electric utility filed a formal notice of dispute early Thursday with Mitsubishi Heavy Industries of Japan and its United States subsidiary, Mitsubishi Nuclear Energy Systems.

The action sets in motion negotiations that involve finding fault and assessing financial damages.

Edison, based in Rosemead, is the senior partner at the massive nuclear plant. Other partners include San Diego Gas & Electric and the city of Riverside's electric utility.

"Our action is about making sure that Mitsubishi takes responsibility for providing the defective steam generators that led to the closing of SONGS" — the San Onofre Nuclear Generating Station, Edison President Ron Litzinger said.

In the notice, Edison alleges that Mitsubishi manufactured "a lemon" and could not fix "defects in its product because they were so fundamental and pervasive."

Mitsubishi does not dispute that the generators failed after being installed as part of a repowering project designed to prolong the life of a facility that provided electricity for more than 1.4 million homes in Southern California.

Frank Gillespie, Mitsubishi Nuclear's senior vice president, concedes that a previously unknown phenomenon caused the pipes to vibrate and leak, preventing the plant from producing energy.

The contractual dispute, he said, would be over who is responsible for the problem and how much financial liability is involved.

Edison's notice opens a 90-day window for the two sides to resolve the problem. If that is unsuccessful, Edison would initiate a binding-arbitration proceeding against Mitsubishi as stipulated in the original contract with the Japanese firm.

Damages related to the failed steam generators could top $2 billion, according to Edison's most recent business update on costs associated with San Onofre.

marc.lifsher@latimes.com

Twitter:@marclifsher

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