The US State of California is a trendsetter for the rest of the country and sometimes the world; this is why a look at its nuclear history is of concern across the country and potentially around the world.

In 1981, Central California was the host of some of the largest anti-nuclear demonstration ever held in this country. The Diablo Canyon nuclear power plant, build by Westinghouse on an earthquake fault, was billions of dollars over budget X years late. Ten thousand people came to protest the reactor starting up, over 3,000 were arrested in non-violent direct actions similar to the blockades at Temelin in the past summers. As with Temelin, the protestors were right, Diablo Canyon produces some of the most expensive electricity in the world. The political pressure and these economic problems killed future development of nuclear power in California and so the rest of the country, years before the Chernobyl accident.

In 1992, California became the first state in the country to close a nuclear plant early by binding public referendum. The Rancho Seco plant near Sacramento was closed and now on the grounds of this Northern California unused reactor there are thousands of solar panels, providing some of the replacement power for the region.

In 1996, California was the first state to pass an electricity deregulation bill. This will open the electricity business to competition, the same way telephone, trucking and airlines have been deregulated over the years. At first look, this should be good news for persons concerned with nuclear power. Nuclear power is consistently more expensive than other forms of power in the US and opening the market to competition should force these reactors closed early, because they are too expensive to run.

Unfortunately, the very powerful electric utilities put some strings on the legislation to give up their monopoly. One string is called "Recovery of Stranded Assets". In simpler language, it means the nuclear utilities get paid for their bad investments in nuclear power, before the competition begins. This is a US$28 billion cost for the 5 operating reactors in the state. This cost is so large that no small consumers will actually benefit from electricity competition for at least 5 years, because the rate cuts are less than the cost of paying for these reactors.

California would not be interesting, if it were not for the fact that so many other places follow its lead. Most of the nuclear states in the US are talking about some kind of "stranded asset recovery" now for their electric utilities. And in the case of Vermont, when the state proposed not to give the nuclear operator extra funding for their reactors, the utility blocked the deregulation plan in court claiming that they would go out of business. Hopefully, the courts will remind them that competition means that some inefficient companies will go out of business and just because they were foolish enough to invest in nuclear power, does not mean they should be granted large sums of money for these up popular decisions.

Is California relevant for the Czech Republic or Europe as a whole? Perhaps. There is quite some danger that the deregulation process in Europe will follow the US lead and give huge bailouts to electric utilities, especially if they are state owned. This has already happened in the UK and is virtually certain in France.

If the Czech Republic joins the European Union, one of the many disadvantages will be they will be forced to open the electricity market, almost certainly before it is ready. Cheap electricity from other countries (including coal from Poland and subsidized nuclear power from France) will force CEZ to operate Temelin (if it is ever completed) at a tremendous loss, or close it early.

Paxus Calta is the Lead Nuclear Campaigner for Friends of the Earth International and is currently working on a state wide referendum in California to prevent nuclear utilities from collecting "Stranded Assets"