The ruling by U.S. District Judge J. Garvan Murtha in Brattleboro is a win for the Vermont Yankee plant's owner, New Orleans-based Entergy Corp., which had argued during a three-day trial in September that the state's efforts to close the plant were pre-empted by federal law.
The federal Nuclear Regulatory Commission granted a 20-year extension on Vermont Yankee's license in March 2011. But state law required Vermont lawmakers to support the license extension as well. A bill to grant legislative approval was defeated 26-4 in the state Senate in 2010 and the House has never acted.
Vermont is the only state with a law giving it a say in nuclear plant relicensing.
Entergy argued that the state was moving to close Vermont Yankee out of concerns over plant safety, an issue that the state agreed is solely the NRC's jurisdiction. The state maintained it had other reasons, including that Vermont Yankee didn't fit in to its energy plan and was likely to be increasingly unreliable as it aged.
The judge said the record showed clearly that the state's primary concern was safety. He said instances from legislative record "almost too numerous to count ... reveal legislators' radiological safety motivations and reflect their wish to empower the legislature to address their constituents' fear of radiological risk."
Entergy issued a statement praising the decision.
"The ruling is good news for our 600 employees, the environment and New England residents and industries that depend on clean, affordable, reliable power provided by Vermont Yankee," the company said.
Gov. Peter Shumlin's office issued a statement saying he was "very disappointed ... Entergy has not been a trustworthy partner with the state of Vermont."
"I continue to believe that it is in Vermont's best interest to retire the plant. I will await the attorney general's review of the decision to comment further on whether the state will appeal," the statement said.Sandra Levine, a lawyer with the Conservation Law Foundation, which supported the state's case, called the decision "a setback for Vermont and a setback for clean energy. Vermont is being forced to prop up a dirty and aging nuclear reactor and its untrustworthy owners."
The matter now goes back to the Vermont Public Service Board, which still has to approve the plant's continued operation. Entergy lawyers sought during the federal court case to sharply narrow the grounds on which the board could shut the plant down.
Attorney General William Sorrell, who called the decision "more of a loss than a win," said Entergy was successful in restricting" the board's authority to some extent. The decision said Vermont can't demand bargain rates for electricity as a condition for Vermont Yankee to stay open. The board in the past usually has had authority to set such conditions.
The 2010 Senate vote came at what may have been the reactor's political nadir. Just a month earlier, it was revealed that tritium, a radioactive isotope of hydrogen, had been leaking from under the plant, and that plant officials had made misleading statements to state lawmakers and regulators indicating that Vermont Yankee did not have the sort of underground pipes that carried tritium - pipes it was later shown to have.
Vermont Yankee's initial 40-year license expires in March, and the debate and federal court case over the plant's future were being watched closely both by the nuclear industry and anti-nuclear groups as a measure of whether a state in which nuclear critics have gained political control can close its lone reactor.
The losing side in federal court was expected to appeal Murtha's decision to the 2nd U.S. Circuit Court of Appeals in New York, though it was not immediately known whether the state would follow through with that.
Other laws passed by Vermont's liberal Legislature have been overturned in recent years in legal challenges that reached the U.S. Supreme Court. The high court in 2006 struck down a state campaign finance law as too restrictive, and last year nullified a state law that sought to curb data collection for drug companies on which medicines doctors were prescribing.
Entergy filed suit against the state in April, a month after the NRC granted the 20-year license extension.
The 605-megawatt Vernon plant in the state's southeast corner historically has provided about a third of the electricity used in Vermont, but it would be expected to sell all its power out of state if it continues operating. Vermont's utilities have lined up future power supplies from Canada and other sources, a fact that Entergy's lawyers said should further minimize the state's role in regulating Vermont Yankee.
In July, Murtha denied Entergy's request to issue a preliminary order allowing the plant to operate while the lawsuit works its way through the courts.
During both the hearing on that request and the trial, Entergy's lead lawyer, Kathleen Sullivan, pointed to numerous instances in legislative committee hearings and floor debates in which lawmakers said their primary concern with Vermont Yankee was safety.
Gov. Shumlin statement: "I am very disappointed in today's ruling from the federal court. Entergy has not been a trustworthy partner with the state of Vermont. Vermont Yankee needed legislative approval 40 years ago. The plant received approval to operate until March, 2012. I continue to believe that it is in Vermont's best interest to retire the plant. I will await the Attorney General's review of the decision to comment further on whether the state will appeal."
Sen. Bernie Sanders statement: "The court today has made a decision that is, in my view, wrong on the merits and ripe for appeal. I believe the law is very clear, and that states have the right to reject nuclear power for economic and other non-safety reasons. It is inconceivable to me that Entergy can force Vermont to allow continued operation of Vermont Yankee, an aging and problem-plagued nuclear plant, when the people of Vermont want to move aggressively to energy efficiency and sustainable energy. Vermont's laws, which Entergy agreed to abide by when it bought Vermont Yankee, require that Entergy receive a new certificate of public good in order to operate beyond March of 2012. In a very strong 26-4 bipartisan vote, the Vermont Senate voted against allowing Vermont Yankee to receive that certificate. They believed, and I believe, that the continuation of Vermont Yankee in our state is not in the best interest of Vermont. Allowing Entergy to evade laws they agreed to abide by sets a horrendous precedent which should not be allowed to stand. The state of Vermont and other states must have the right to determine their own energy future."
Sen. Patrick Leahy statement: "I share Governor Shumlin's disappointment with the court's ruling. While the Atomic Energy Act gives the federal government exclusive jurisdiction to license the use of nuclear materials, our state clearly needs and deserves a role in any decision about continued operation of this plant. Vermont has vital economic and energy reliability interests in this plant's operations and this plant's future."
Rep. Peter Welch statement: "This is a major setback for Vermont and for all states with nuclear power plants. It simply defies common sense that a state cannot have a say in its energy future. This issue was settled in Vermont until Entergy reneged on its agreement to give Vermonters a voice in relicensing Vermont Yankee. I intend to work closely with Governor Shumlin and Senators Leahy and Sanders on an appropriate response to Entergy's misguided decision to railroad the relicensing of this plant."
Speaker Shap Smith and Senate President Pro-Tem John Campbell joint statement: "Under this decision, Vermont Yankee remains required to have a Certificate of Public Good issued by the Public Service Board in order to operate. We expect the Public Service Board will consider the issue of continuing operation in its pending docket. The state will look closely at the decision to see what boundaries the Court has set for the issuance of a Certificate of Public Good and will hear from all parties to ensure that the best interests of Vermont and its citizens are represented in this process."
Statement from the New England Coalition President Ned Childs: "We are deeply disappointed in Judge Murtha's unfortunate decision. NEC expects to support the Vermont State Attorney General on appeal as we did in Vermont District Federal Court."
Statement from the New England Coalition Legal Counsel Jared Margolis: "The court's decision allows Entergy to continue to operate the Vermont Yankee plant past the scheduled March 21, 2012 closing date for what could be several years of higher court reviews. This is very disappointing, especially given that the State Legislature has already determined that continued operation of the plant is not in the best interests of Vermont."
Download the court's decision (102 pages, PDF), here.