BRATTLEBORO - The Vermont Public Service Board has approved the installation of a new 3,000-kilowatt diesel generator at Vermont Yankee nuclear power plant in Vernon.

In August 2012, Entergy, which owns and operates Yankee, asked for approval of the generator due to the loss of the Vernon HydroDam as the plant's source of back-up in case of a system-wide failure. For the past 40 years, the dam has served as that source of back-up power, but after ISO-New England, which regulates the transmission of electricity in New England, changed its post-blackout start-up procedures, the dam was no longer an acceptable source.

After reviewing a number of options, Entergy settled on the diesel generator as the most appropriate way to provide back-up power to the plant.

The Public Service Board appointed a hearing officer to expedite the certificate review, because Entergy needs the generator up and running by Sept. 1.

But shortly after Entergy applied to the PSB, it filed a petition with the U.S. District Court for the District of Vermont asking that Vermont be removed from the approval process. Entergy has argued that the generator is required for safety reasons and the state has no role in approving systems necessary for safety.

Earlier this week, the district court took testimony on Entergy's complaint, but it has not yet ruled on the petition.

The state has argued that it has a role in the approval process as long as it maintains its focus on the orderly development of the region, the need for Yankee's power and environmental impacts.


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Jim Sinclair, spokesman for Yankee, told the Reformer that because the board has issued the certificate, Entergy will be notifying the district court that it will no longer pursue the matter. Construction is scheduled to start next week.

"We are pleased that the Public Service Board has issued the Certificate of Public Good for the new diesel generator," said Sinclair. "As we have maintained throughout the CPG process, the new diesel generator provides the best option to provide an additional source of safe and secure back-up power to the plant site and ensures full compliance with Nuclear Regulatory Commission safety regulations."

The PSB's hearing officer, Lars Bang-Jensen, concluded the project will be of limited size and scope and does not raise significant issues in relation to state regulatory schemes. He also concluded that installation of the generator "will promote the general good of the state." Bang-Jensen noted that he paid particular attention to the board's concerns over whether it has the authority to approve the certificate application while Entergy is not in compliance with existing board orders and certificates, most notably the fact that the plant's current CPG expired on March 21, 2012.

Even if a new CPG is not issued by the board, he wrote, "Entergy VY has made the requisite demonstration of need for the Project to be in place as of September 1, 2013 ..."

"I recognize the seriousness with which the Board regards the deliberate failure by any company subject to the Board's jurisdiction to comply with the terms of Board Orders, CPGs and approved memoranda of understanding, and the Board's particular concerns about Entergy VY's record of compliance with Board Orders, CPGs, and prior commitments," wrote Bang-Jensen.

He noted that even if Entergy had ceased operations at the plant while awaiting a new CPG, a backup generator would still be required because the Nuclear Regulatory Commission requires a station blackout power source be operational until all fuel is permanently removed from the reactor vessel.

Other than for periodic testing, the diesel generator is intended to operate only when offsite power is lost combined with loss of service or failure of two existing diesel generators previously installed at the the power plant, wrote Bang-Jensen.

"If such an event occurs, the diesel generator is intended to serve as a Station Blackout Power Source that will permit Entergy VY personnel to bring the plant to a shutdown condition during a station blackout."

Bang-Jensen also noted that "it would seem reasonable for the Board to decline to issue a CPG to a company that is not in compliance with existing Orders when the non-compliant company seeks Board approval of a project from which it expects to derive economic benefit (for example, an expansion of generation capacity), but has not demonstrated how and when it will come into compliance with existing Orders."

However, he wrote, that provision doesn't appear to apply in this request for the generator.

Bang-Jensen advised the board that during its certificate hearings for continued operation, it will have to determine whether the plant will "meet the need for present and future demand for service ..."

Though all three board members - James Volz, David Coen and John Burke - signed off on the approval, Coen noted he opposed opening a hearing into the installation of the diesel generator.

"As I stated at the time, I did not believe the Board should consider Entergy VY's petition to construct additional facilities at the VY Station given the circumstances of Entergy's non-compliance with Board Orders," he wrote. "Under the circumstances, I could not see how consideration by the Board of the construction of additional facilities needed to perpetuate the currently unauthorized operation of the VY Station could be justified."

However, wrote Coen, supplemental testimony provided by Entergy supports the conclusion that Entergy would need a new source of station blackout power even if it had fully complied with board orders, allowing him to add his name to the CPG approval.

"Had Entergy VY provided this information to the Board seven months earlier at the time it filed its petition, the Board would have had considerably less difficulty processing, considering and granting this petition on an accelerated schedule," noted Coen. "I remain mystified by why Entergy VY did not recognize the importance this information would have for the Board at the time it filed its petition, and why it waited so long to present this evidence to the Board."

In 2011, Entergy sued the state after the Legislature refused to grant the PSB the authority to issue a certificate of public good for continued operation.

In March 2011, the NRC issued an extended operating permit allowing Entergy to operate the plant until 2032. The old license expired on March 21, 2012.

In January 2012, a federal district court judge found in favor of Entergy, ruling the Legislature had overstepped its bounds into NRC territory by considering radiological safety in its hearings.

While the federal court was considering Entergy's complaint, the PSB put its own hearings on hold. Following the court's ruling, the PSB reopened its hearings and hopes to render a decision sometime in August.

Bob Audette can be reached at raudette@reformer.com, or at 802-254-2311, ext. 160. Follow Bob on Twitter @audette.reformer.