Business & Economy

Vermont fights Nuclear Regulatory Commission’s license approval for Vermont Yankee

Vermont Yankee on the banks of the Connecticut River

The state Department of Public Service is scrutinizing recent actions by Entergy Corp.

The department is questioning whether the 20-year license extension the Nuclear Regulatory Commission issued the company in 2011 is valid.

State officials say Entergy doesn’t have a Clean Water Act permit.

Sarah Hofmann, deputy commissioner of the Department of Public Service, said the federal NRC should have required the company to get certification from the state that the plant would not violate state water quality standards.

“Our allegation is that they needed to have that in order to get their license renewed,” Hofmann said. “Entergy’s claim is that they are still operating under their old one.”

Elizabeth Miller, commissioner of the Department of Public Service, will be presenting oral arguments to the U.S. Court of Appeals in Washington on Wednesday.

Vermont Yankee was originally scheduled to shut down in March of this year. Entergy continues to run the 40-year-old plant because it has the NRC license and a federal judge ruled in January that the state doesn’t have the authority to pre-empt federal law.

Entergy bought the plant in 2002, and applied for a new license in 2006. In 2010, the Vermont Senate voted against allowing the Public Service Board to issue a new license. That decision was based on a 2006 law allowing legislative approval. Earlier this year federal district court Judge Garvan Murtha found the state law unconstitutional, ruling that it was pre-empted by federal statutes. The Vermont Attorney General has appealed that decision.

Entergy recently requested approval for a certificate of public good from the Vermont Public Service Board.

A lot hangs in the balance in the legal arena — and with Vermont Yankee’s financial situation.

A decision in federal court could affect the outcome of the Public Service Board proceeding, and what the D.C. Circuit decides could affect the plant’s federal permit.

It appears that Entergy is also trying to spin off its transmission business and merge it with a separate company called ITC holdings. According to an Entergy spokesman, however, this will likely not affect Vermont at all.

On April 30, ISO-New England, the region’s electric grid operator, accepted a bid by Entergy to de-list the Vernon plant from its 2015-16 “capacity commitment period.” ISO-New England rejected previous requests from Vermont Yankee to be removed from the futures market.

But in its most recent filing with the Federal Energy Regulatory Commission, it stated “the ISO determined that Vermont Yankee is not needed for reliability for the 2015-16 Capacity Commitment Period.”

ISO New England stated that was because it expects transmission upgrades and other resources to be in place by that time.

The one thing that does appear certain is that the plant will continue operating while the legal and regulatory proceedings are pending.

Public Service Board decision in 2013, at the earliest

Wrangling over Vermont Yankee’s new permit will last late into 2013, at least, under a calendar set by the Public Service Board.

For some parties in the Public Service Board docket, the schedule set by the board drags it out too far.

“It’s taking too long,” said Sandra Levine, senior attorney for the Conservation Law Foundation in Vermont. “This case could easily be decided in less than a year and a half. Entergy is dragging its feet.”

The amended schedule sets a deadline for intervenors at June 18. Final filings are due Aug. 26, 2013, hence the year and a half timeline.

Entergy requested the later time line, telling the board it could not prepare testimony until June 29. The Department of Public Service, which represents Vermont ratepayers in front of the board, asked for a May 15 filing date.

CLF’s proposed schedule, which the board rejected, advanced hearings by four months.

The board will hold public hearings on Nov. 5 in Vernon and another on Nov. 19 via Vermont Interactive Television.

Levine said the longer the process takes, the longer Vermonters will have to wait to see the plant close.

The parallel litigation in federal court over the Vermont laws caused the board to start over and create a new record to avoid using “preempted” materials in the record.

Not all the intervenors in the docket were as concerned about the lengthy schedule.

“This is a very long process,” said Jared Margolis, an attorney representing the New England Coalition, a group that wants to see the plant close. “We’re starting from scratch.”

He said the longer schedule will allow the board to make an informed decision based on a valid record.

The parties will file their first round of written testimony June 29.

The continuing dispute has proved problematic for Entergy, the state and environmentalists alike.

For Entergy, ongoing litigation with Vermont, prompted the company to file an “impairment evaluation” addressing the uncertainty of the plant’s continued operation on the value of the company.

The company has been filing such reports since 2010 about the plant’s potential value in the future.

In an April 26 earnings conference call, Entergy CFO Leo Denault said the estimated value of the plant, as opposed to what the company’s books said, resulted in a $356 million pre-tax “impairment charge.”

The dip in stock value reported by the company was directly related to the plant’s uncertain continued operation.

The impairment derives from the unique legal and State regulatory processes surrounding Vermont Yankee, which make it uncertain that the plant will operate until the license expires in 2032,” Denault said. “Absent this uncertainty, the evaluation for impairment would not have been required.”

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Alan Panebaker

About Alan

Alan Panebaker is a staff writer for He covers health care and energy issues. He graduated from the University of Montana School of Journalism in 2005 and cut his teeth reporting for the Ashland Daily Tidings and Mail Tribune newspapers in Southern Oregon where he covered education and the environment. A dedicated whitewater kayaker and backcountry skier, he later wrote a weekly outdoors column for the Anchorage Press in Anchorage, Alaska, and continues to publish freelance work for Canoe & Kayak magazine. Alan took a three-year hiatus from journalism to attend Vermont Law School. After passing the bar, he decided to return to his journalism roots and start chasing stories again. He lives in Montpelier.

Postscript: Alan died in a kayaking accident on Sept. 19, 2012, shortly after he took a job with American Whitewater. We here at VTDigger mourn his passing.

Email: [email protected]

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