photo courtesy of topher76@flickr.com

This past week has shown Vermont first-hand the high cost of nuclear power. Hosting a plant in your state is clearly a high-stakes bargain.

Vermont went to Court in Manhattan this week before a three judge panel at the United States Court of Appeals. (Read more here and here). It had fifteen minutes for its lawyer to explain to the judges why the decision of the District Court blocking the actions of the Vermont Legislature should be reversed. A tough task.

With clarity and nimbleness, Vermont proved it was up to the task. Its lawyer, Attorney David Frederick, an experienced appellate lawyer who argued a case last week before the United States Supreme Court, explained that Vermont has every right to determine Vermont Yankee’s fate. And doing so does not impinge on the federal government’s oversight of radiological issues.

In a nutshell, there were three points.

First the United States Supreme Court case from 1983 that let stand a California law enacting a moratorium on nuclear plants would allow the Vermont law. If a state can ban all nuclear plants, it can certainly allow the Legislature to determine the fate of one plant.

Second, the lease on Vermont Yankee expired and like a landlord, Vermont can simply refuse to renew the lease. Period. Any tenant knows this. Vermont is hosting this plant and can say it wants the property used for another purpose.

Third, Vermont has huge skin in the game and economic exposure from Vermont Yankee. If Entergy, the owner of Vermont Yankee, goes bankrupt or simply chooses to walk away, Vermonters are left holding the bag for what Conservation Law Foundation has described as the nuclear equivalent of junk car in its backyard. This possibility is more likely following recent reports that Vermont Yankee is not pulling its weight and that Entergy would be better off closing the plant.

The stakes are high. Apart from hosting this plant, Entergy is seeking to recoup over $4 million in legal fees, and now has four law firms working to push every legal angle possible. Times change. When Vermont first approved the Vermont Yankee facility in the 1970s, there was a hearing for three days before the Vermont Public Service Board. Clearly nuclear power and hosting plants is more expensive and time consuming than ever.

Vermont is right to begin extracting itself from this nuclear legacy. Unfortunately, that is proving to be not so easy.

Photo courtesy of Andy Hares @ flickr.com

The financial world is waking up to what a drag Vermont Yankee really is. The tired, old and leaking nuclear plant in Vermont is not carrying its weight. Financial analysts report that Vermont Yankee is economically vulnerable and a retirement announcement would boost stock prices for its parent, Entergy.

You can read the UBS Investment Research report “Re-assessing Cash Flows from the Nukes” here. It states:

“Notably, we believe both its NY Fitzpatrick and Vermont Yankee plants are at risk of retirement given their small size; while potentially negative to sentiment, an announcement to retire the units would likely drive positive FCF revisions.”

Clearly it is past time to close this plant.

Analysts today dropped the projected price target for Entergy’s stock. They see high debt and little cash coming in. Not good news for any investment.

It is good the financial world is waking up to what Vermonters have known for years. Vermont Yankee is not a good deal. It hasn’t been for years. It is expensive and financially risky. Conservation Law Foundation submitted testimony to the Public Service Board on the lousy economics of allowing Vermont Yankee to continue to operate. It does not have enough money for decommissioning, low energy prices mean it is not making money and any problems would saddle Vermont with big problems. You can read CLF’s testimony here.

These are not problems we need. Nuclear power was once touted as too cheap to meter. That has never been true. Now it is too expensive to even keep operating. Thank goodness financial markets are waking up to this fact.

photo courtesy of strikkelist@flickr.com

Regulators issued another strong rebuke to the owners of Vermont Yankee. The Vermont Public Service Board strongly rejected Entergy’s requests to change prior orders. Entergy continues to operate in defiance of Vermont law. Patience with this sort of behavior is wearing thin.  Read the decision here.

Entergy asked to change orders so that it would have authority to operate past March 21, 2012. The Board strongly rejected that request. As the Board’s conclusion states:

For the reasons set out above, the Board denies Entergy VY’s motion to amend Condition 8 of the Sale Order, which prohibited operation of the Vermont Yankee Nuclear Power Station after March 21, 2012, without Board approval and conditions in the Dry Fuel Storage Order and CPG that limit the amount of spent nuclear fuel that Entergy VY may store at the Vernon site to amounts generated from operation up to March 21, 2012.

Entergy knew and agreed to the commitment not to operate after March 2012 and had ample time to challenge or seek amendment earlier. Entergy didn’t.

Instead, Entergy chose to defy the Board’s orders, walk away from its commitments, thumb its nose at Vermont and just continue to operate. It then asked the Board to change the prior orders, claiming hardship and that being held to its prior commitments was somehow unforeseeable.

The Board roundly rejected each of Entergy’s claims. Any hardship is Entergy’s own making based on its own tactical decisions, and does not justify changing the rules after the fact.

Entergy’s in a very tight box. It cannot prove to the Board that it is a trustworthy operator when at the same time it is operating in bold defiance of the same Board’s orders.

When:  Monday evening, November 19, 2012 beginning at 7 pm.

Where:  Vermont Interactive Television sites around Vermont – Find locations here.

What:  Should Vermont Yankee – a tired, old nuclear facility on the banks of the Connecticut River retire and its untrustworthy owners close shop?

How:  Speak up at a public hearing. This is YOUR chance to let YOUR voice be heard.

Help put an end to Vermont Yankee’s troubled history.

The Vermont Public Service Board will determine if Vermont Yankee should be allowed to operate for another twenty years. A disappointing court case decided last spring said issues of radiological health and safety can only be decided by the Nuclear Regulatory Commission, but Vermont regulators will decide if continued operation of Vermont Yankee by its untrustworthy owners makes sense for Vermont’s economy, environment and power supply.

Need a refresher? Here is a list of newspaper headlines about problems at Vermont Yankee since the collapse of the cooling tower in 2007.

More information is available from the Public Service Board website.

Tips and issues to talk about:

1. Environment – Heated water from the plant is harming fish and habitat in the Connecticut River. This has been getting worse and Entergy’s studies have been faulty.
2. Economics – There is little value to Vermont from the continued operation of the plant. There is the equivalent of a junk car on the banks of the river. Money has not been added to the decommissioning fund and it is inadequate to close and clean up the site.
3. Untrustworthy owners – Entergy is not a good partner for Vermont. Their executives provided false testimony to regulators  and continue to break promises, including a promise that they would close in March 2012.
4. Energy Plan – Vermont is moving away from older and more polluting forms of energy towards clean renewable energy. Vermont Yankee is not part of a sustainable energy future for Vermont.
5. No Need for Power — There is an excess of electric power available in New England now. The lights will stay on without Vermont Yankee.

Tell the Board what you think.

Written or email comments can also be provided.

In a world where messages are sent instantaneously, it is hard to believe the time to consider (again) whether the continued operation of Vermont Yankee is good for Vermont would take more than a year.

Entergy, Vermont Yankee’s owners, proposed a schedule to Vermont regulators that would have the case completed in just over eighteen months.  

CLF argued for a shorter schedule noting that Entergy’s schedule was “roughly equivalent to the gestation period for elephants.”  This is simply too long.

Most cases, including the previous Vermont Yankee proceeding at the Public Service Board and the recent federal trial for Vermont Yankee were completed in far less time. 

In its ruling on May 4, the Vermont Public Service Board accepted the longer time-frame Entergy requested. It also provides for two separate rounds of hearings – one in February and a second in June. The Board also scheduled two public hearings where anyone interested can weigh in and provide input to the Board on whether Vermont Yankee should retire.

Entergy’s foot dragging means Vermonters will wait an extra eighteen months before seeing this tired, old and polluting nuclear plant closed. That’s too bad. Especially since the plant was supposed to close on March 21, 2012.

photo credit: stuck in customs, flickr

The two sets of hearings suggest the there will be a very thorough review and the Board, which likely will take a very active role in the hearings.

The thoroughness is good. It just shouldn’t have to take this long.

In a sharply worded decision, the Vermont Public Service Board made clear yesterday that it intends to holds Entergy to its commitments.

The Board stated that the provision of Vermont law that allows licenses to continue while a new proceeding is underway “does not provide authority for Vermont Yankee to continue operating, and storing spent nuclear fuel derived from such operation, while Entergy VY’s petition for a new or amended CPG remains pending.” (p.25).

The decision makes it clear that Entergy’s current license includes obligations that preclude storing fuel generated after March 21, 2012. (p.19) It also recognized that the Board order approving the sale to Entergy back in 2002 relied on Entergy’s promise not to operate after 2012 unless it had approval from the Board. (p.18)

The Board further chastised Entergy and its multi-million dollar legal team noting it expected them “to provide better organized and more cogent briefing.” (p.9 fn. 19).

The Board’s decision was made “in full recognition of the federal District Court’s decision” and does not cross purposes with it. It clarifies Entergy’s commitments and obligations. Entergy should be held to their promises. Entergy cannot simply pick and choose which obligations it will follow.

It is not clear what’s next. The ball is in Entergy’s court. It can and should comply with its obligations and keep its promises.

Entergy asked the Public Service Board today to just give it a new certificate of public good claiming no further review is needed. (Read the motion here.)

Judge Murtha’s decision was clear. The Vermont Public Service Board continues to have authority to review Entergy’s actions and determine if continued operation is beneficial to Vermont.

CLF opposed Entergy’s past efforts. This new request is premature. It is contrary to the Court’s order and ignores facts that are important for the Board to hear. Most notable is the fact that Entergy provided false information to the Board about buried pipes.

Entergy’s lack of trustworthiness cannot be ignored. It is an important matter that has bearing on whether Entergy should be allowed to continue to operate Vermont Yankee.

While Entergy might like to ignore these facts, Vermont won’t.

At a time when our governors and our President were preparing to address their constituents, CLF was (and is) making news – news that raises a series of enduring questions: In our country, where is the line between federal and state authority? How clear is it? Who gets to draw it? Why would you draw it in one place instead of another?

These questions are so challenging because they are so fundamental; Americans have wrestled with these same questions for over 200 years. You’ll recall that our first national government, under the Articles of Confederation, was too weak to do the job. The Constitution granted greater power to the national government, but had to be balanced by the Bill of Rights, securing the rights of individuals and of states. The rest of our efforts to get the federal/state balance right has been marked by long periods of contentious negotiation and flashbulb moments of fractious history –national banking, secession and the Civil War, the busting of industrial trusts, the New Deal, and civil rights for all.

Protecting our health and our environment has been a part of the national and regional negotiations for decades. Recent events have provoked further discussion.

By the 1960’s and ‘70’s, when Congress began to address environmental protection and energy in a serious way, its constitutional authority to do so was relatively clear. It exercised that authority boldly, for the great benefit of generations of people and other species. However, as in much of our federalist system, there’s still a sharing of power between national and state governments, both by design and by default. The zone between federal and state authority is sometimes gray. It’s in that messy, gray area that many of our most controversial environmental issues are being debated.

These debates continue to this day. Take two of CLF’s hot issues recently in the news: Vermont Yankee and Cape Cod nitrogen pollution.

Vermont Yankee

The first is the adverse federal court decision CLF (and the State of Vermont) received on Vermont Yankee, the aging nuclear power plant in Vernon, VT. The decision affirmed the Nuclear Regulatory Commission’s broad authority over safety issues relating to nukes. It  preempted a role for states and handed a major victory to Entergy Corporation.

However, as Anthony Iarrapino points out in this blog post, the fight is far from over. There is a clear role for states in shaping our energy future; in the absence of federal action, states are leading the effort in promoting a clean energy future. Furthermore, as Anthony pointed out in his post, the court said:

“This Court’s decision is based solely upon the relevant admissible facts and the governing law in this case, and it does not purport to resolve or pass judgment on the debate regarding the advantages or disadvantages of nuclear power generation, or its location in this state. Nor does it purport to define or restrict the State’s ability to decline to renew a certificate of public good on any ground not preempted or not violative of federal law, to dictate how a state should choose to allocate its power among the branches of its government, or pass judgment on its choices. The Court has avoided addressing questions of state law and the scope of a state’s regulatory authority that are unnecessary to the resolution of the federal claims presented here.”

Even in the highly “federalized” area of nuclear power there is an undeniable role for states.

Cape Cod

The second is a settlement in principle of our litigation to clean up pollution from sewage on Cape Cod. This is a great step forward – one that  has attracted the focused attention of anti-environmentalists in Congress, as this article attests.

They preposterously allege collusion between environmentalists and the EPA in cases like this to expand federal jurisdiction beyond what Congress authorized in the Clean Water Act, thereby trumping state authority.  However, the federal/state line under the Clean Water Act is about as blurry as they come, in part because the facts relating to pollution and its impacts are extremely complex. As in all cases, the facts matter. Careful, dispassionate assessment of the scientific facts about discharges and pollution, and how the law applies to those facts – not political grandstanding by Members of Congress – is what’s necessary to achieve the visionary goal Congress as a whole committed to decades ago: the elimination of polluting discharges to United States waters, by 1985! It’s time we lived up to that commitment.

There is opportunity in messy, gray areas like the shifting federal/state interface: we can go forward or backward. That is, we can develop sensible allocations of authority between federal and state governments to achieve the public goals behind all of these public initiatives – a healthy environment and a healthy economy, or we can descend into politically motivated mudslinging that obscures the real issues and thwarts real progress.

At CLF we are committed to rational, fact-based discussion of the issues, and prudent forward motion that yields a thriving New England, for generations to come and for all. We know this terrain well. You can count on us to keep working it.

The headlines following yesterday’s federal court decision overturning Vermont laws giving the legislature a say in the continued operation of Vermont Yankee make it seem like the case was a total victory for Louisiana-based Entergy Corporation and its multi-million dollar legal dream team.  Not so!

The decision makes clear that State officials — specifically the state’s Public Service Board — still have broad authority to deny Entergy the “Certificate of Public Good” on grounds that are traditionally within the authority of the state to decide, including economics, land use, and trustworthiness of the plant’s owners to be honest, fair-dealing members of the state’s business community.  Unless Entergy receives a Certificate of Public Good authorization from the Board, it cannot continue operating the plant for another 20 years past its long-scheduled retirement date of March 2012.

Nothing in the Court’s decision upsets that aspect of longstanding Vermont state law — a law that applies to all sorts of power generating projects located in Vermont’s borders — the so-called “Section 248 process”. On page 4 of the Court’s decision the judge clearly states as follows:

“This Court’s decision is based solely upon the relevant admissible facts and the governing law in this case, and it does not purport to resolve or pass judgment on the debate regarding the advantages or disadvantages of nuclear power generation, or its location in this state. Nor does it purport to define or restrict the State’s ability to decline to renew a certificate of public good on any ground not preempted or not violative of federal law, to dictate how a state should choose to allocate its power among the branches of its government, or pass judgment on its choices. The Court has avoided addressing questions of state law and the scope of a state’s regulatory authority that are unnecessary to the resolution of the federal claims presented here.”

So where does that leave things?

Fortunately, CLF has played a leading role in the ongoing Public Service Board proceedings involving Entergy’s application for a new Certificate of Public Good.  Tapping some leading industry experts, CLF has presented a clear case that continued operation of the Vermont Yankee is NOT in the public good of the citizens of Vermont.

Our case rests entirely on grounds that are specifically not placed out of bounds by the Court’s decision yesterday.  These include economics and the failure to have sufficient funds available close the plant and restore the site at the end of its useful life.  Also the claims of an economic benefit from the revenue sharing agreement and the lack of a power contract all show that continued operation does not benefit Vermont.  Add to that the failure of Entergy officials to be forthcoming and provide truthful information about underground pipes, and Entergy’s failure to abide by existing water quality permits and there are many areas of traditional state concern that remain.

The court’s decision is a definite setback, but there are still many opportunities.  Vermont shouldn’t be forced to prop up this old reactor.  Enough is enough.  The Court’s decision left many avenues still open for Vermont to have a say in whether Vermont Yankee continues to operate for another twenty years.