[V]ERNON — A New York private equity firm has snapped up yet another company involved in the proposed decommissioning of Vermont Yankee.
J.F. Lehman & Co. acquired Texas-based Waste Control Specialists, which is slated to dispose of Vermont Yankee’s low-level radioactive waste when the idled Vernon nuclear plant is razed.
Last year, J.F. Lehman acquired NorthStar Group Services, the company that wants to buy Vermont Yankee and carry out an accelerated decommissioning plan.
That means NorthStar and Waste Control Specialists now are sister companies, with NorthStar Chief Executive Officer Scott State also assuming that role for the disposal firm.
In an interview Monday, State said the corporate moves add another layer of “certainty” and stability for the Vermont Yankee job. They may also put NorthStar in a better position to take on other nuclear decommissioning projects.
“I view it as a very positive development for the overall plans in Vermont and for our company elsewhere,” State said.
Vermont Yankee stopped producing power in December 2014, and Entergy is seeking regulatory approvals to sell the plant and its decommissioning trust fund to NorthStar by the end of this year.
NorthStar has promised to decommission and restore most of the site no later than 2030, which is decades faster than Entergy is proposing. The cleanup company has assembled what State called a “dream team” of subcontractors for the Vermont Yankee job, including Waste Control Specialists, which operates a low-level radioactive waste dump in Andrews, Texas.
But it’s been a rough road lately for Waste Control Specialists.
In spring 2017, the company cited financial issues in suspending its attempt to develop a high-level nuclear waste site that could accept spent fuel from plants like Vermont Yankee.
That decision came in the midst of a larger legal battle with the federal government. In late 2016, the U.S. Department of Justice filed an antitrust suit to block Waste Control’s acquisition by Utah-based EnergySolutions, another nuclear disposal company.
Federal regulators claimed that joining the two companies would create a “near monopoly” in the low-level radioactive waste business. Last year, a federal judge agreed and blocked the deal.
But it didn’t take long for Waste Control Specialists to find a new buyer.
In announcing the acquisition, J.F. Lehman Partner Alex Harman said Waste Control “maintains an industry-leading reputation and provides an essential solution for the safe disposal of specialized waste streams.”
Harman added that the combination of Waste Control Specialists and NorthStar under the Lehman umbrella “will allow us to provide a complete and cost-effective decommissioning solution for U.S. nuclear utilities.”
That’s a key point for Vermont Yankee and for other nuclear plants that have or will shut down.
State said the new corporate structure doesn’t lower Vermont Yankee’s waste-removal prices, but it does streamline the working partnership between NorthStar and its disposal company.
“The management of Waste Control will be 100 percent focused on the needs of NorthStar,” State said. “We will be able to better control and manage the activities for shipping waste and disposing of waste that comes out of Vermont Yankee.”
The acquisition also could stabilize Waste Control Specialists’ finances, which came under scrutiny during last year’s federal antitrust litigation.
At trial, the company claimed it was on the verge of shutting down and would “exit the market” if the EnergySolutions acquisition was not approved. Justice Department officials cast doubt on those contentions, labeling the closure threat a “sham.”
In her ruling, U.S. District Judge Sue Robinson said she gave “no weight” to Waste Control’s closure claims but also pointed out that the company “has not been a profitable enterprise.” Ultimately, the judge did not rule specifically on whether the company was in danger of imminent failure.
J.F. Lehman executives say Waste Control Specialists now will have the resources to grow. And State said the Lehman acquisition means the disposal company “has been completely recapitalized – the balance sheet is very strong.”
By making the deal, State said, “I think we take away concerns that disposal could potentially be impacted for Vermont Yankee due to Waste Control Specialists’ financial position.”
At the same time, State said the acquisition should not delay or alter the regulatory process for the proposed Vermont Yankee sale.
“I think one of the key takeaways for Vermont here is … it doesn’t have any impact whatsoever on NorthStar’s financial position,” State said. “We didn’t buy the company. Our owners bought the company.”
The implications of the Lehman acquisitions also extend beyond Vermont Yankee.
That’s because NorthStar is positioning itself to make Vermont Yankee the first of many such decommissioning projects. NorthStar already has a long-term decommissioning partnership with a Vermont Yankee subcontractor that specializes in taking apart reactors, and the new Waste Control affiliation provides another dimension to those ambitions.
“We have a number of ongoing discussions for potential projects – some that are well along,” State said. “This does improve our discussions with those kinds of parties. It really makes us the only true turnkey supplier for everything that one would need for decommissioning.”
That doesn’t mean, State said, that the companies are redirecting any attention or resources from the Vermont Yankee project.
“With all the various opportunities we might see, Vermont will be the first project in the queue,” he said.
