Entergy plans to cut about 30 jobs at the Vermont Yankee nuclear plant by the end of the year, a vice president at the Louisiana-based corporation said Tuesday.
The news comes on the same day Entergy reported to the U.S. Securities and Exchange Commission that the company would eliminate roughly 800 positions from its nationwide workforce of 15,000. Entergy employs about 650 workers at Vermont Yankee in Vernon, which means layoffs would affect about 4 percent of employees.
“It’s really across the board,” Terry Young, Entergy VP of communications, said of the job reductions. “What we did through this process is really redesign the way we do business and redesigned the nuclear organization’s structure.”
Entergy’s operational earnings are down more than 50 percent in the second quarter of 2013, from $2.11 a share last year to $1.01 a share this year. Translated into total dollar amounts that is $179.7 million in the second quarter this year versus $374.6 million last year.
To adjust for this decrease, Entergy is reorganizing via its “Human Capital Management initiative.” Entergy projects the restructuring will save the company $200 million to $250 million by 2016.
“Difficult decisions like job reductions are sometimes the very tough outcome of making long-term, fundamental improvements in the way a company works,” Leo Denault, CEO, said in the SEC filing. “The redesign process has been comprehensive, thoughtful and focused squarely on being fair to our employees throughout the process and being responsive to the needs of our customers, our employees, our communities and our owners.”
Young said the plant’s safety would not be compromised as a result of the job reductions.
“We will pay special attention to ensure the changes we are making do not impact the hands-on, core functions of daily operations of plants, so that there’s no impact on safety and reliability,” he said.
Neil Sheehan, spokesman for the U.S. Nuclear Regulatory Commission, said federal regulators are aware of Entergy’s plans, and Vermont Yankee must have at least two control room operators on staff at all times. The NRC also mandates certain levels of security and emergency response personnel, but Sheehan said the NRC would not divulge those numbers for the Vernon plant due to security reasons.
“There have been reorganizations in the past at other U.S. nuclear power plants,” Sheehan said. “As in those cases, the NRC has the ability to determine whether there are any adverse impacts through our Reactor Oversight Process. … We also accept allegations, at any time and anonymously, from any staffer who has a safety concern he or she believes is not being addressed.”
In 2013, the fair market value of the Vermont Yankee nuclear plant fell 69 percent, from $517.5 million to $162 million. UBS Securities downgraded Entergy Corp.’s stock from “neutral” to “sell.” The Swiss financial services firm also projected the closure of an Entergy nuclear facility in 2013, saying “Vermont Yankee is the most tenuously positioned plant.”
Entergy is in the process of applying for a new state permit to operate the Vermont Yankee nuclear plant for another 20 years. The Vermont Public Service Department is opposed to the notion of re-permitting the 41-year-old plant.
Geoff Commons, the director of public advocacy for the department, oversees the case for the executive branch. He said that when the quasi-judicial Public Service Board held hearings in June on the matter, he does not remember the issue being raised, and his team has not found mention of workforce reductions from Entergy’s testimony.
“I’m pretty confident that nothing about any potential layoffs came up. This would have gotten some play,” he said. “If this was known before the close of evidence, it does not reflect well upon Entergy’s truthfulness.”
The Public Service Board will, in part, base its approval or denial of Vermont Yankee’s new license on the economic status of the plant. Commons says he is considering asking the board to reopen the hearings to discuss this issue.
“This certainly would have a bearing on the economic benefit they are claiming and the question for us is whether the economic impact of that on the case justifies reopening the case and having more process to get that into the record,” Commons said.