AB305 makes two kinds of changes to California law: it alters statutory barriers that have long limited where new nuclear plants can be sited, and it obligates the Public Utilities Commission to produce a plan to shift procurement toward nuclear and away from natural gas. The bill does this by amending existing Public Resources Code provisions that condition certification and permitted land use on federal approval of fuel reprocessing and on demonstrated disposal methods for high‑level waste, and by adding a new Public Utilities Code section directing the CPUC to adopt a procurement plan.
These changes matter to energy developers, utilities, and local governments because they carve out a regulatory path for a specific reactor design while simultaneously signaling a state-level procurement preference that could affect long-term contracting and resource planning. The practical effects will depend on how the exemptions are implemented, how the CPUC shapes its procurement plan, and on federal answers to waste and reprocessing questions the state law continues to defer to the United States or its authorized agencies.
At a Glance
What It Does
The bill amends Public Resources Code sections 25524.1 and 25524.2 to create an exemption for "small modular reactors" from the existing state prohibitions and certification conditions tied to fuel‑rod reprocessing and high‑level waste disposal. It also adds Public Utilities Code §711, which requires the California Public Utilities Commission to adopt, by January 1, 2028, a plan to increase electricity procurement from nuclear facilities and phase out procurement from natural gas facilities.
Who It Affects
Affected parties include developers and manufacturers of small modular reactors, investor‑owned utilities and other load‑serving entities that contract for long‑term supply, the California Energy Commission and CPUC (which administer certification and procurement duties), and local governments and communities where reactors could be sited.
Why It Matters
The bill removes a statutory hurdle that has constrained new nuclear development in California for decades while creating a formal state procurement signal favoring nuclear over gas. That combination changes the legal and commercial calculus for siting, permitting, procurement, and grid planning, and it shifts regulatory pressure onto both state agencies and federal waste‑management authorities.
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What This Bill Actually Does
AB305 rewrites two existing Public Resources Code provisions that, until now, have effectively blocked new nuclear fission thermal powerplants unless the Energy Commission (CEC) can point to approved U.S. technologies for fuel‑rod reprocessing and demonstrated methods for permanent disposal of high‑level waste. The bill inserts an explicit carve‑out: a "small modular reactor" (defined in the bill) is not subject to those prohibitions or certification conditioning.
For all other nuclear designs, the existing procedural framework remains — the CEC must find appropriate federal approval or demonstrated technology for reprocessing and disposal, report to the Legislature, and then wait through the specified legislative review period before proceeding with certification.
Operationally, the statutory mechanics the bill leaves in place are the CEC’s factual findings and the report-and-wait process: the CEC reports its findings to the Legislature, the report is assigned to committees, and the commission may proceed unless a house adopts a disaffirming resolution within 100 legislative days or both houses act by statute. AB305 keeps that machinery intact for reactors other than SMRs, including the statutory timing that reports be submitted at least six calendar months before adjournment so the Legislature has time to respond.On procurement, AB305 adds a new section to the Public Utilities Code requiring the California Public Utilities Commission to adopt a plan by January 1, 2028, to increase procurement of electricity from nuclear facilities and to phase out procurement from natural gas facilities.
The statute does not prescribe the plan’s content beyond that dual aim, so the CPUC will need to decide scope, metrics, how the plan interacts with existing integrated resource planning, resource adequacy rules, and procurement contracts, and whether to apply its directives to investor‑owned utilities, community choice aggregators, or publicly owned utilities through different mechanisms.Finally, the bill preserves existing named exceptions in current law (the citation to Diablo Canyon Units 1 and 2 and San Onofre Units 2 and 3) and otherwise relies on federal agencies for reprocessing and disposal determinations. That keeps the state’s longstanding deference to federal technical and safety determinations in place while creating a distinct state-level policy preference toward siting a particular reactor class and toward substituting nuclear for gas in procurement portfolios.
The Five Things You Need to Know
AB305 amends Public Resources Code sections 25524.1 and 25524.2 to exempt "small modular reactors" from the statutory prohibitions and certification conditions tied to fuel‑rod reprocessing and high‑level waste disposal.
The bill defines "small modular reactor" as a nuclear reactor with an electrical generating capacity of up to 300 megawatts per unit.
For reactors other than small modular reactors, AB305 leaves intact the Energy Commission’s existing duties to find federal approval of reprocessing technology and demonstrated disposal methods and to report those findings to the Legislature with the current 100‑legislative‑day review window and six‑month reporting timing.
AB305 adds Public Utilities Code §711, which requires the California Public Utilities Commission to adopt a plan by January 1, 2028, to increase procurement from nuclear facilities and to phase out procurement from natural gas facilities.
The bill preserves existing named exceptions in current law (Diablo Canyon Units 1 & 2; San Onofre Units 2 & 3) and continues to defer substantive determinations about reprocessing and disposal to the United States or its authorized agencies.
Section-by-Section Breakdown
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Exemption for small modular reactors from reprocessing‑based siting ban
This section revises the code that currently bars certification or permitted land use of nuclear fission thermal powerplants that require fuel‑rod reprocessing unless certain federal approvals and technologies exist. AB305 inserts an explicit exemption: "This section does not apply to a small modular reactor." Practically, that means the Energy Commission cannot rely on the preexisting reprocessing/disposal gate to block licensing of SMRs; it must treat them outside that prohibition while maintaining the same reporting and legislative review machinery for other reactor types.
Exemption for small modular reactors from high‑level waste disposal requirement
This amendment mirrors Section 1’s approach for the separate statutory requirement tied to demonstrated technology or means for permanent disposal of high‑level nuclear waste. By excluding SMRs from that requirement, the bill lets the CEC process notices and applications for SMRs without the existing precondition that a demonstrated disposal method be identified. The text retains the statutory language clarifying that a demonstrated means need not have ready facilities in place at the time of a finding, but that clause now applies to non‑SMR plants.
PUC procurement plan to boost nuclear and phase out natural gas
This new section directs the California Public Utilities Commission to adopt, on or before January 1, 2028, a plan to increase procurement of electricity generated from nuclear facilities and to phase out procurement from natural gas facilities. The statute states the goal and the deadline without prescribing detailed metrics, procurement targets, procurement mechanisms, or which load‑serving entities the plan must affect, leaving significant design choices to the CPUC and potential interplay with existing procurement and integrated resource planning laws.
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Who Benefits
- Small modular reactor developers and vendors — The statutory exemption removes a state‑level legal barrier tied to reprocessing and disposal findings, shortening a regulatory obstacle that has suppressed new nuclear proposals and making California a more attractive market for SMR projects sized up to 300 MW per unit.
- Investor‑owned utilities and long‑term buyers seeking zero‑carbon baseload options — The CPUC’s required plan provides a clear state policy signal favoring nuclear procurement, which can justify long‑term contracting and capital allocation toward nuclear projects as part of decarbonization strategies.
- Nuclear equipment and construction supply chain — A signal of potential procurement and a lowered siting hurdle for SMRs would increase prospective market demand for modular reactor components, licensing support, and construction services.
- State procurement units and agencies with decarbonization mandates — Agencies charged with meeting zero‑carbon targets could gain access to new contracting options that align with state policy if the CPUC plan enables utility purchases of nuclear generation to substitute for natural gas.
Who Bears the Cost
- Natural gas plant owners and fuel suppliers — A statutory directive to phase out gas procurement shifts long‑term contracting dynamics, potentially reducing forward purchases of gas‑fired capacity and revenue for existing gas assets.
- Electricity ratepayers — If contracted nuclear supply carries higher up‑front capital costs or requires long lead times, ratepayers could face higher procurement costs depending on contract structures and how the CPUC allocates cost recovery.
- Local governments and communities near proposed SMR sites — Exemptions from certain state‑level preconditions accelerate the prospect of siting without resolving social concerns (emergency planning, public participation, local land‑use controls), leaving community stakeholders to manage local impacts.
- California Energy Commission and CPUC staff and budgets — Implementing the exemption, processing additional SMR certification filings, and developing a PUC procurement plan with attendant analyses (reliability, cost, resource adequacy) will consume regulatory resources and require technical expertise and funding.
- Federal agencies and waste‑management authorities — The bill increases pressure on federal decision‑making regarding reprocessing and permanent disposal because California’s altered state rules assume continued federal primacy on those technical determinations while enabling development absent state‑level disposal readiness.
Key Issues
The Core Tension
The central dilemma is straightforward but hard to solve: accelerate decarbonization by enabling and procuring more nuclear generation (and thereby reduce reliance on fossil gas) versus the unresolved technical, fiscal, and social challenges of nuclear waste management, siting, and near‑term cost and reliability trade‑offs. The bill pushes toward the first objective while leaving the hardest questions about the second largely to future regulatory and federal action.
AB305 combines a targeted siting exemption with a broad procurement directive; that pairing generates a set of implementation and policy tensions. The exemption for small modular reactors removes a statutory block tied to reprocessing and disposal findings, but it does not resolve the underlying technical and institutional problems of spent fuel management.
The bill continues to defer to federal authorities for reprocessing and disposal approval, which means California could authorize projects domestically even if federal disposal or reprocessing pathways remain unresolved. That raises questions about interim storage strategies, who bears the cost and liability for long‑term waste stewardship, and how emergency planning and local regulatory processes will adapt.
On procurement, the statute prescribes ends (increase nuclear procurement, phase out gas) without prescribing means. The CPUC will have to reconcile this direction with existing procurement law, integrated resource planning, resource adequacy rules, and statutory cost‑recovery mechanisms.
Absent specific targets, timelines, or coverage rules, the plan could take many forms—ranging from modest contract preferences to aggressive long‑term procurement—that have materially different cost and reliability implications. The timeline to January 1, 2028 gives the CPUC a definite deadline but not guidance about transitional reliability, contract term limits, or how to treat community choice aggregators and publicly owned utilities.
Finally, the bill sets up potential legal and political friction points: local governments and activists may view the SMR exemption as an end‑run around longstanding legislative safeguards; utilities and market participants will contest how the CPUC translates a policy goal into binding procurement actions; and federal‑state coordination over waste disposition remains a gating but unresolved factor. Each of these implementation gaps creates uncertainty for investors, communities, and regulators and could produce litigation or protracted regulatory proceedings if not carefully managed.
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