Ruling passed, but continued operation not done deal

Posted
Saturday January 21, 2012

VERNON -- The future of the Vermont Yankee nuclear power plant may have become a little clearer Thursday when a federal judge ruled in Entergy's favor, but many experts say its continued operation isn't a done deal yet.

Attorney General William Sorrell's office has 30 days to decide whether to appeal the ruling by U.S. District Judge J. Garvan Murtha.

"We're still studying the decision and will be consulting with the governor's office and Legislative leaders on what the next steps will be," Assistant Attorney General Scott Kline told the Reformer Friday.

Chanel Lagarde, spokesman for Entergy, which owns and operates the nuclear plant in Vernon, said the ruling is "good news for (the plant's) 600 employees, the environment and New England residents and industries."

Lagarde declined to comment about anything else, including whether the plant will continue to operate past March 21, the expiration date of its initial 40-year license, without a new Certificate of Public Good.

The federal Nuclear Regulatory Commission gave Vermont Yankee a 20-year license extension last March. Previously, a Vermont Senate vote appeared to have blocked the plant's continued operation. Entergy sued the state the following month, saying it was pre-empted under federal law from imposing a decision contrary to the NRC's.

Murtha's ruling stated that state legislation was pre-empted because it sought to regulate radiological safety, the sole purview of the NRC, but he also wrote that for Entergy to continue to operate it would have to receive a new CPG from the Public Service Board.

Patrick Parenteau, a professor at Vermont Law School, said in an interview that Murtha's decision "puts Entergy sort of right back where they were before" the Legislature passed a law, unique to Vermont, saying lawmakers had to give their approval before Entergy could get state permission to operate past its 40th birthday.

In the state's favor, Parenteau said, is that Murtha rejected Entergy's argument that Public Service Board authority over Vermont Yankee should be sharply curtailed based on the fact that it is a "merchant plant," not selling its power through a traditional utility system, but on the open market as a wholesaler to out-of-state power companies.

"That's important because it leaves the Public Service Board with authority over the plant," he said.

Parenteau added that Murtha was "meticulous" in his ruling.

The following is an in-depth synopsis of his ruling:

The Atomic Energy Act of 1954, created a "comprehensive and pervasive program of federal regulation and licensing that permitted the private use, control, ownership and operation of commercial nuclear power reactors," Murtha wrote.

Congress believed private development of nuclear energy would serve the national interest and the Act gave the federal government "exclusive jurisdiction to license the transfer, deliver, receipt, acquisition, possession and use of nuclear materials," he wrote. "No role was left for the states."

Four years later, Congress amended the act to authorize agreements between the Commission and state governors permitting limited state regulation of certain materials.

Vermont Yankee, a boiling water reactor, began operating in 1972 under a federal 40-year Facility Operating License, issued by the Atomic Energy Commission, the federal agency preceding the NRC.

At its inception, the plant was owned by Vermont Yankee Nuclear Power Corporation, a joint venture of eight New England retail utilities, including two state utilities that held a combined 55 percent stake.

Since that time the plant has produced approximately one-third of the state's electricity, about 55 percent of the station's output with the remainder being purchased by utilities in neighboring states.

Entergy purchased the plant in 2002 and signed a Memorandum of Understanding which granted the Public Service Board jurisdiction over a new CPG to operate past March 2012.

In 2005, Entergy officials proposed an increase for the plant's output and the approval to construct on-site storage of spent fuel, which became the basis for Act 74.

During hearings with the state's Natural Resources and Energy Committees, legislators heard more than a dozen witnesses testify regarding their safety concerns surrounding spent fuel storage, Murtha wrote.

One expert witness, hired by legislative counsel said, "the problem that we're dealing with here is that a lot of the concerns that citizens have are concerns that you can't address directly the way they want them to be addressed," and when a legislator stated that dry cask storage was "a safety issue" the expert responded, "I don't think you want to address this from the point of view of safety at all."

Murtha wrote that despite being told that safety was not in the Legislature's purview, lawmakers "frequently raised safety considerations" regarding spent fuel.

During the three-day trial in September, Entergy's lawyers argued that this was just one of many instances that proved the Legislature was passing Act 74, 160 and 189 with the intent to regulate radiological safety.

Hundreds of hours of testimony were entered into the record.

"One of my big problems and why I want some money from somebody, is that if the federal government or Entergy doesn't protect it, we're going to have to do it because we are not going to let our citizens ... blow up," one lawmaker said.

On June 2, 2005, the Senate Finance Committee held a hearing where a legislator "repeatedly expressed the Legislature's desire to act on radiological safety concerns, despite being told this was not in the body's purview, and where the benefits of having preempted concerns appear in the MOU were discussed," Murtha wrote.

The following day, during the Senate floor debate, senators again made statements about radiological safety, he wrote.

One senator said, "I for one, want to state categorically and explicitly, that safety is the prime concern, safety is not for sale, no amount of money is worth it to increase any risk of danger to Vermonters."

Murtha wrote that other excerpts about safety-related statements from the Senate debate and committee hearings were "too voluminous to recount here."

Entergy began constructing the dry cask storage facility, which was designed to hold 36 loaded casks, a number sufficient to allow the plant to operate through the end of the potentially renewed NRC license, which would expire in 2032.

On Jan. 27, 2006, a few months before the PSB issued its order permitting dry cask storage, the NRC received Entergy's application for a 20-year license extension.

The NRC initiated an extensive, five-year review of Vermont Yankee, which included auditing aging management programs, reviews to ensure it could operate without undue risk to public health and safety, multiple site inspections to analyze safety risks, an audit to ensure the plant adequately reviews its systems for radiological health and safety risks and held multiple public meetings and hearings to address environmental and safety concerns regarding continued operation, Murtha wrote.

A few days after Entergy filed for the license extension the Senate Committee on Finance held the first hearing on a draft of Act 160 on Feb. 1, 2006.

The bill was introduced on the Senate Floor on Feb. 24.

Four days later, during a hearing, one senator stated, "we're asking that studies be provided to legislators on health and safety and economics."

Entergy's lawyers argued that again, during the passing of Act 160, the lawmakers' intent was to regulate the plant's radiological safety and again Murtha agreed, citing numerous references of recorded testimony.

On Jan. 8, 2008, Act 189, which was designed to conduct "an independent safety assessment" of the plant was introduced.

Murtha wrote that between drafts three and four of the bill, it was revised to remove the word "safety" in most places.

"Safety" was either replaced with "operating," "operational," "emergency," or omitted altogether, he wrote. "There was, however, little change to the substance of the bill.

The bill was also renamed, "A Comprehensive Vertical Audit of the Vermont Yankee Nuclear Facility."

During debate over the bill, legislators again discussed safety, he wrote.

"There is a fair amount of public concern about the adequacy of the NRC's inspection process," one senator said. At the same debate, another senator stated, "I support the review of the safety of Vermont Yankee."

John Herron, chief nuclear officer at Entergy, testified that NRC inspectors review all of the aspects of plant operations and reviews each of the specific systems identified in Act 189.

On Jan. 7, 2010, Vermont Yankee officials confirmed test results from the day prior, indicating tritium, a low-energy radioactive isotope of hydrogen, a byproduct of nuclear operations, was detected in tests of monitoring wells at the plant. The NRC and various state agencies were notified and Entergy conducted an internal investigation to locate and stop the leak.

On Feb. 15, Entergy's team identified a leak source in a concrete pipe tunnel and two days later, Legislative counsel presented Bill 289, "an act relating to approval for continued operation of the Vermont Yankee nuclear power station" to the Senate Finance Committee.

The committee heard testimony the next day from Entergy, the Department of Public Service, Vermont utilities and groups opposed to the plants continued operation.

One senator stated she believed Vermonters "uncomfortable" with Vermont Yankee "don't want to sleep with ... one eye open waiting for something to happen down there that can't be controlled."

Then-Senator Peter Shumlin also commented on the lack of power price agreement between the state and the plant.

He said an agreement hadn't been entered because "the price is no good; that Vermonters would have to pay too much. I agree with that assessment."

On Feb. 24, 2010, the Senate voted 26-to-4 to prevent the Public Service Board from issuing a Certificate of Public Good to Vermont Yankee.

"There is no debate," one senator said. "Vermont Yankee has made bad decisions and has been a less than perfect partner with the state. Their breach of trust with people of Vermont leaves a terrible scar on their relationship with all of us."

Two months later the NRC issued a letter stating "the public's health and safety and the off-site environment were not adversely affected" by the tritium leak.

Last March, after a five-year review, the NRC issued a Renewed Facility Operating License for the plant, certifying its continued operation from March 22, 2012 through March 21, 2032 could be "conducted without endangering the health and safety of the public."

On April 18, 2011, Entergy filed its suit against the state. A month later, Green Mountain Power announced it had reached a 23-year power purchase agreement to buy electricity from the Seabrook nuclear power plant in New Hampshire, subject to approval by Vermont regulators.

The NRC has acknowledged that NRC license renewal alone does not ensure continued operation of a plant, Murtha wrote.

"After the NRC makes its decision based on the safety and environmental considerations, the final decision on whether or not to continue operating the nuclear plant will be made by the utility, state, and Federal, non-NRC, decision makers," he wrote. "This final decision will be based on economics, energy reliability goals, and other objectives over which the other entities may have jurisdiction."

During the trial, Entergy and the state argued over how much of the Legislative record should be reviewed and allowed as evidence to prove or not prove intent of why Acts 74, 160 and 189 were passed.

While the state said very little should be admissible, Murtha wrote that inquiry into the legislative history of the acts is important, especially in 160, because there was clear evidence that the statute was "motivated by and grounded in radiological safety concerns, and the statute on its face empowers future legislatures to apply the statute to deny continued operation for radiological safety reasons and evade review."

He added that references in the history, "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, and beliefs that the plant was too unsafe to operate, indicting a petition for continued operation."

In respect to the state's interests in "need for power" and "choice among power sources," Murtha stated the energy problem Vermont faced was the end of its favorably priced long-term power contract with Entergy.

Likewise, in all the recordings of committee hearing testimony and floor debate for Act 74 is a catalog of "extensive record of Legislators' statements of radiological safety purposes -- statements that are too numerous to recount again here," Murtha wrote.

While the state pointed to passages in the Legislative history, which they claim reveal non-safety motives in passing Act 74, he stated that none of them were persuasive enough to prove that the overarching concerns were radiological safety.

For all those reasons, Murtha ruled the part of Act 74 regarding the storage of spent nuclear fuel derived from the plant's operation and Act 160 are pre-empted.

He added that Entergy proved irreparable harm if the plant was closed because of pre-empted laws because, in part, "the public interest would not be disserved by the issuance of the following permanent injunctions."

Those opposed to the plant's continued operation say they're not giving up in the slightest.

Anthony Larrapino, an attorney with Conservation Law Foundation, said Murtha's ruling isn't necessarily a "total victory" for Entergy.

"The court's decision is a definite setback," he said. "But there are still many opportunities to close the plant on time. Vermont shouldn't be forced to prop up this old reactor. 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."

In yet another forum, the state and the watchdog group New England Coalition have gone to the U.S. Circuit Court of Appeals in Washington to ask it to overturn the NRC's decision on Vermont Yankee's license extension. The state and NEC argue that regulators overlooked that Vermont Yankee lacked a needed water-quality certificate under the federal Clean Water Act.

At issue is the heated water Vermont Yankee discharges into the Connecticut River after using the river water to cool plant components. Environmentalists say the discharge hurts some fish species and other aquatic life.

"We're really tired of them heating up our river," said Rep. David Deen, river steward with the Connecticut River Watershed Council and chairman of the House Committee on Fish, Wildlife and Water Resources.

The Associated Press contributed to this story.

Josh Stilts can be reached at jstilts@reformer.com, or 802-254-2311 ext. 273.

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Download the court's decision (102 pages, PDF), here.


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