Energy

Questions dominate Vermont Yankee sale discussion

Katz and MacDonald
Deb Katz, left, executive director of the Citizens Awareness Network, confers with state Sen. Mark MacDonald, D-Orange, during a hearing Thursday in Vernon regarding the proposed sale of Vermont Yankee. Photo by Randolph T. Holhut/The Commons
VERNON – In a crowded cafeteria at Vernon Elementary School, debate and discussion about the proposed sale of Vermont Yankee stretched for three hours Thursday night.

But it all might boil down to one question: Is it too good to be true?

Few spoke unequivocally for or against Entergy’s plan to sell the shut-down nuclear plant to NorthStar Group Services. Rather, most expressed support for NorthStar’s promise to decommission the plant promptly, while also confessing doubts about the company’s ability to follow through.

Leslie Sullivan Sachs, of the Safe & Green Campaign in Brattleboro, may have best summed up that stance when she described herself as “agnostic” on the matter.

“I do very strongly believe that it is the responsibility of our generation to clean up this site,” she said.

Leslie Sullivan Sachs
Leslie Sullivan Sachs of the Safe & Green Campaign in Brattleboro listens to discussion about the proposed sale of Vermont Yankee. Photo by Randolph T. Holhut/The Commons
“At the same time,” she added, “I’m worried about Vermont being a guinea pig.”

Thursday’s meeting, hosted by the state Public Service Department and the Public Service Board, came about five months after Entergy announced an agreement to sell Vermont Yankee to NorthStar.

The New York-based decommissioning company has promised to clean up most of the site – with the exception of a spent fuel storage facility – by 2030. That’s decades faster than Entergy had been planning.

NorthStar’s takeover is contingent on approval by the U.S. Nuclear Regulatory Commission and the Public Service Board. Entergy and NorthStar submitted a detailed application to the board in December, and the Vernon meeting was part of the state regulatory body’s review.

The Public Service Department, whose job it is to represent the public interest in energy matters, started the evening with an hourlong informational session. It featured NorthStar Chief Executive Officer Scott State and Mike Twomey, external affairs vice president for Entergy Wholesale Commodities.

Twomey said the NorthStar transaction would be in the best interest of Vermont. And some in the audience needed no convincing.

Cheney Hofmann
Vermont Public Service Board members Margaret Cheney, left, and Sarah Hofmann at the hearing Thursday in Vernon. Photo by Randolph T. Holhut/The Commons
Guy Page of the Vermont Energy Partnership said he hopes that, after the Public Service Board’s review, “you will be able to get to yes. Because ‘yes’ is good for the environment and for the economy of Vermont.”

Page cited examples including the projected economic benefits of decommissioning activity as well as the possibility that Vermont Yankee’s spent fuel could be removed sooner than expected via Waste Control Specialists, a NorthStar decommissioning partner.

For some, the NorthStar proposal is a potential solution to a nuclear debate that has long vexed Vermont. After proper review, “let’s move this forward,” urged Tim Smith, executive director of the Franklin County Industrial Development Corp.

“This is a conversation that’s been going on for as long as I can remember,” Smith said. “I think it’s time that we probably put this to bed so that my children don’t have to worry about this conversation.”

Vernon officials – some of whom are still smarting from longtime state opposition to Vermont Yankee – also are lobbying for the deal to go through.

“To get this land back to a usable state is paramount for Vernon and Windham County for economic development,” said Josh Unruh, Vernon Selectboard chairman. “To not allow this sale is further cutting the town of Vernon off at its knees.”

Many others in the audience, however, expressed concerns and skepticism.

“Sometimes, when things seem too good to be true, they are,” said Lorie Cartwright, a Brattleboro resident affiliated with the anti-nuclear New England Coalition. “I would just implore the board to please do its homework, do its due diligence.”

Deb Katz, executive director of the Massachusetts-based Citizens Awareness Network, said NorthStar is proposing “a radical change in decommissioning.”

Usually, she said, a utility cleans up a plant and has ratepayers to fall back on if the project exceeds budget. That’s not the case here, and Katz speculated whether financial constraints could force NorthStar to cut corners.

“What you may wind up with is a dirty cleanup,” Katz said. “What you may wind up with, in fact, is having a brownfield at Vermont Yankee.”

The feasibility of NorthStar’s proposal – and its safety – also was on the mind of Westminster West resident Betsy Williams. “There’s a great concern I have for a decommissioning process happening right across the street from an elementary school,” she said.

State Sen. Mark MacDonald, D-Orange, a longtime Entergy critic, pressed State and Twomey on who would be liable if something goes wrong “despite the best wishes, projections and assumptions.”

The concern is that Vermont could be on the hook in such a scenario. But State persistently answered that such responsibility falls on the owner of the plant.

Scott State
NorthStar Group Services CEO Scott State. Photo by Randolph T. Holhut/The Commons
During the Public Service Department presentation, and in an interview after, State took pains to defend his company’s proposal. He said the decommissioning project has been broken down into 920 items, each with its own budget, and that NorthStar will cover any spending over that budget.

But currently, State said, “the sum of all 920 items is less than the amount of money in the (decommissioning) trust fund.”

NorthStar on Wednesday gave the NRC a revised post-shutdown decommissioning activities report for Vermont Yankee. That document estimates that NorthStar will spend $811.5 million at the plant from 2019 onward.

Just under $500 million of that, however, is for termination of Vermont Yankee’s license. The decommissioning trust fund held $571.5 million at the end of February.

The remainder of NorthStar’s cost estimate includes $25.3 million for site restoration – which comes from a separate trust fund – and $287.8 million for long-term spent fuel management. NorthStar has said it expects to fund fuel management through litigation with the U.S. Department of Energy, though some doubt the reliability of that plan.

NorthStar also is offering a $125 million “support agreement” available for decommissioning “in the unlikely event that (performance) bonds are unavailable or inadequate.”

That’s not much comfort for Michael Granger, a Newfane real estate agent who asked the Public Service Board to examine NorthStar’s backup plans.

“I would argue that the board or their professionals should maybe look into whether or not the $125 million is acceptable, and whether or not performance bonds are even available,” Granger said.

As for concerns about the quality of NorthStar’s cleanup, a proposal to use some of Vermont Yankee’s rubble as fill is expected to be a key point of contention. The issue came up at Thursday’s meeting, but Twomey said only “clean” rubble – free of radiological contaminants – would stay at the site.

Mike Twomey
Mike Twomey, external affairs vice president for Entergy Wholesale Commodities. Photo by Randolph T. Holhut/The Commons
Reusing that material is “just common sense,” Twomey said. “To do otherwise is just to increase costs foolishly.”

Not all of the focus at Thursday’s meeting was on Entergy and NorthStar.

The cleanup company has worked on large fossil fuel plants and small research reactors but has never owned and decommissioned a reactor like Vermont Yankee. State has pointed to the extensive nuclear decommissioning experience of Areva, a French company that’s expected to be a partner in the Vernon project.

Several members of the audience spoke about Areva’s financial and regulatory troubles overseas, with Katz arguing that there are “real questions about Areva’s work.”

Afterward, State said he has no concerns about Areva, citing a recent corporate restructuring. NorthStar’s Areva partner in North American ventures “is a freshly capitalized entity with about a billion-dollar balance sheet,” he said.

“So the entity we’re dealing with is a very sound entity,” State said. “It’s not an entity that’s in any kind of financial distress.”

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  • Pete Novick

    Once upon a time…

    In 2002, the NRC approved the transfer of the Facility Operating License DPR-28 of Vermont Yankee from Entergy Nuclear Vermont Yankee, LLC (Entergy Nuclear VY), Entergy Nuclear Operations, Inc. (ENO) to Entergy Nuclear VY and ENO.

    Here’s a link to the NRC’s

    ORDER APPROVING TRANSFER OF LICENSE AND CONFORMING AMENDMENT

    https://www.sec.gov/Archives/edgar/data/1046861/000095013502003090/b43382eeexv99wdv7.txt

    Section III contains the NRC’s order with respect to the decommissioning trust funds and it’s worth a read.

    Also, here’s a link to the 2002 MOU between Entergy Nuclear VY, GMP, CVPS and the Vermont PSB:

    https://assets.documentcloud.org/documents/809199/entergy-vy-mou.pdf

    Here is the paragraph from the MOU

    “Transfer of Decommissioning Fund: Pursuant to Section 6.10(b) of the PSA, at Closing the entire fund balance in the VYNPC Qualified Decommissioning Trust Fund and Non Qualified Decommissioning Trust Fund will be transferred to the funds established by Buyer’s Post Closing Decommissioning Trust Agreement (as defined in the PSA).”

    So….

    Why not stipulate that as part of their purchase, NorthStar must post a cash bond in an amount equivalent to the balance of the trust fund on the date of sale, said bond to be held by the Vermont Attorney General?

    …and they all lived happily ever after.

    Cheers