A House committee approved a grant of $500,000 for economic development in Windham County as the region plans for the closing of the Vermont Yankee nuclear power plant.

The House Committee on Commerce and Economic Development voted Wednesday to support the grant requested by the Agency of Commerce and Community Development, and passed the measure along to the Appropriations Committee.

The grant would be the first disbursement from $10 million that Entergy will pay the state according to an agreement between the state and Entergy, operator of Vermont Yankee, for the purpose of economic development in the region.

Lawrence Miller, secretary of the agency, said the money will not come from the state's General Fund.

"I thought it was better to go ahead and say, 'Yes, we would like the spending authority in the budget adjustment that would allow us to go forward if the money shows up,'" Miller said during a committee testimony on Tuesday. "No state dollars."

The money will become available only if the Public Service Board approves a pending license renewal for the plant to operate until the end of the year by March 31. If the agreement is not carried out, he said the agency would introduce an alternative proposal.

Entergy, the Louisiana-based company, announced last year it will close the 41-year-old plant in 2014 for financial reasons -- just days after a federal court ruled the Vermont Legislature could not block the relicensure of the aging nuclear plant for a 20-year period after its presumptive shutdown date of March 21, 2012.

Through an agreement with Entergy, the administration is requiring the plant's decommissioning sooner than required by the Nuclear Regulatory Commission and requesting the company to make payments to Windham County for economic development to offset the impacts of the plant's closure.

Regional planners in the area have a plan that they say will create an "economic ecosystem" for an already financially troubled region of the state.

Vermont Yankee nuclear power plant in Vernon (Entergy Corp.)
Vermont Yankee nuclear power plant in Vernon (Entergy Corp.)

"Why the 500,000 [dollars] is so important now, is that we have real immediate capacity needs," said Patricia Moulton Powden, executive director of the Brattleboro Development Credit Corp.

The money will fund the necessary staff to move their proposals forward, she said.

BDCC funds the Southeastern Vermont Economic Development Strategies (SeVEDS) for the purpose of increasing economic development in the region. The group has dozens of proposals predating the announcement of Vermont Yankee's closure to increase economic vitality.

The nuclear power plant has more than 600 employees, of which 238 are Vermont residents, said Chris Campany, executive director of the Windham Regional Commission.

He said the plant pays nearly 50 percent of Vernon's taxes. Vermont Electric Power Corp. (VELCO), the state's transmission line company, pays nearly all the remaining taxes, Campany said.

The commission is advocating for a prompt decommissioning over the SAFSTOR alternative. SAFSTOR is one of three decommissioning options. It would allow spent fuel to be stored in onsite pools for up to 60 years.

A prompt decommissioning ensures that jobs will remain stable, Campany said, at least for the next several years after the plant cools.

"Our studies indicate that prompt decommissioning would be the softer landing relative to SAFSTOR," he said.

Entergy has agreed to begin decommissioning its plant within 120 days after it has the necessary funds in its decommissioning trust fund. Entergy officials have said the fund has less than $600 million. The total cost of the plant's decommissioning has been estimated at $800 million.

Gov. Peter Shumlin has said the decommissioning could be completed in the 2020s.

Entergy has approximately 2,650 assemblies stored in the spent fuel storage pool and approximately 370 assemblies are in the reactor, according to its website. Upon closure, Vermont Yankee will take the hot fuel from its reactor and place it into its spent fuel pool. It will take more than five years for the spent fuel to cool, the administration has said.

Entergy will have to move all its spent fuel stored in onsite pools to dry cask storage.

According to Vermont Yankee's federal license from the Nuclear Regulatory Commission, the number of spent fuel assemblies stored in the spent fuel pool must not exceed 3,353. The core reactor must not house more than 368 fuel assemblies.

As a condition of the accord, Entergy is also paying into a newly created Site Restoration Trust through initial payments totaling $25 million plus an additional parent guaranty to accumulate over time.