Entergy, Vermont in confidential VY talks


BRATTLEBORO -- Now that Entergy has announced it is closing Vermont Yankee nuclear power plant in Vernon in late 2014, there appears to be a new tenor to the conversation.

In the past, discussions between Vermont officials and the Louisianna-based energy company have often been contentious, to the point that both have ended up on opposing sides in court. In January 2012, a judge in U.S. District Court for the District of Vermont slapped the state hard: The judge ruled the Vermont Legislature had ventured into the federal sphere of regulation when it considered radiological safety during debate over a bill that gave itself the power to determine whether the power plant could continue to operate past March 2012. In August of this year, the U.S. Court of Appeals for the Second Circuit affirmed the district court's ruling.

And then, on Oct. 31, attorneys for Entergy filed in federal court a motion for the award of more than $5.4 million in fees, costs and expenses it incurred in its successful suit.

But a little less than two months before it filed this latest action, Entergy broke the surprise news that it would shutter the 40-year-old plant. The introduction of cheap natural gas had pushed down the cost of electricity so low that Entergy's plan to keep Yankee running for another 20 years no longer made financial sense. It also announced that following the plant's closure, it would be placed in SAFSTOR, a federally approved "mothballing" of the plant that allows for radioactive components and structures to "cool down" and the decommissioning trust to build up the necessary funds to completely remediate the site.

Since then, state and Entergy officials have conducted confidential discussions to find some sort of consensus as to how to mitigate the economic impact on the community and clean up the site quickly and get it ready for some other use.

"Everything is on the table," said Chris Recchia, commissioner of the Vermont Department of Public Service. "But our primary focus is on making the site available for other uses."

The two sides are hashing out a decommissioning schedule and a plan to deal with the nuclear waste produced by the plant. Currently there are 13 dry casks, each containing 25 tons of spent fuel, stored on a concrete pad just north of the reactor building. When all the fuel is removed from the reactor and the spent fuel pool, a process that should take about five years, there will be 58 dry casks on site. How long the radioactive waste will remain on site depends on when the federal government's repository is open for business; the Department of Energy now says that will be in 2048, 50 years after it originally stated it would start to take possession of the waste.

Recchia told the Reformer that he is aware that previous conversations between the state and Entergy have been contentious, to say the least, but he is a relative newcomer on the scene.

"I don't come with the history or baggage associated with the discussions, but I am certainly aware of the issues," he said. "I feel like Entergy has been engaging in these new discussions in a straightforward and constructive manner."

Even the governor, who has been among Entergy's harshest critics, said discussions involving him, Recchia, Attorney General Bill Sorrell and Bill Mohl, Entergy's president of wholesale commodities, have been productive.

"As you know, I have not had much agreement with Entergy in the past," said Gov. Peter Shumlin. "However, now that we both agree Vermont Yankee will be closing, I have found Bill Mohl to be straightforward and willing to consider ways in which the state and Entergy can move beyond past differences and come to agreement on key subjects regarding the future of the closed plant. Obviously, we have many difficult issues before us and we may still have significant disagreements ahead."

Shumlin said that while he won't comment on the specifics of any discussions given the many ongoing legal proceedings, he was satisfied with the direction of the conversation.

When asked whether the state is asking Entergy to drop its suit for attorney fees, Sorrell told the Reformer while he would not comment on the substance of the discussions, he did say the suit for attorney fees has been mentioned.

Earlier this month, Entergy and the state submitted a joint letter to the federal court, asking it to delay its decision on Entergy's request for attorney fees.

"The Vermont Department of Public Service and Entergy are engaged in ongoing discussions regarding a proceeding that is currently pending before the Vermont Public Service Board," stated the letter. "The parties intend to report back to this Court immediately after December 11, 2013 (or earlier) on whether those discussions make it unnecessary for this Court to rule upon Entergy's pending motion for attorney's fees and costs."

Entergy and state officials meet again this coming week.

"We are talking about a range of issues, including the pending legal proceedings, but we're really trying to focus on the future," said Sorrell. "Both sides agree that we shouldn't drag our heels. Time is running out."

Following the announcement that the plant would be closing in late 2014, said Sorrell, Mohl and Shumlin had a candid discussion in which they both expressed the desire to rebuild the relationship between Vermont and Entergy.

"It would be nice to change the tenor between Entergy and the state and move away from an interaction filled with contention and hostility," said Sorrell. "Both the governor and Entergy's Mohl have pledged to do just that."

Sorrell described the latest meeting as both cordial and mutually respectful.

"We remain focused on having constructive discussions with the Governor and the state of Vermont as it relates to the shutdown and decommissioning of the Vermont Yankee facility," stated Mohl, in an e-mail to the Reformer. "Many of the issues we are discussing will require give and take by both parties. We remain optimistic that we can reach an agreement that is acceptable to the state and to Entergy Vermont Yankee."

Recchia also wouldn't divulge the substance of the discussions between the two parties, but he did say it is no secret there is a disagreement over how thoroughly the site needs to be remediated.

In a memorandum of understanding that was signed in advance of the sale of the plant, Entergy agreed to remove "all structures" as part of site restoration, but it has insisted that it is required to only remove them to three-feet below grade.

One thing that is not clear at this moment is what exactly "all structures" means, said Recchia, and does that include buried pipes, foundations of buildings, storage tanks and other components that were installed as part of the plant's construction?

"One of the first steps that needs to occur is an assessment of the site," he said. "It's very hard to pin down how to restore the site without knowing the result of the assessment."

However, said Recchia, it's his department's belief that three-feet below grade "is a minimum."

He said whatever agreements are reached between the state and Entergy, it could be 10 years or more before the site is fully remediated.

"There is a minimum of five years that the fuel that comes out of the reactor core needs to stay in the spent fuel pool. Decommissioning of the reactor can't begin until after that."

It's important for the state and Entergy to come to a mutually acceptable agreement, said Recchia, because "At the end of all of this, Entergy still owns the site." He also said that while the state wants the site to be released for unrestricted use, "We don't want to incur unnecessary costs."

Estimates as to the cost of cleanup range between $600 million and more than $1 billion, but Recchia said none of that cost would be borne by Vermonters.

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


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