The beginning of 2014 marks the final year of operation for the Vermont Yankee Nuclear Power Plant, ending a contentious battle between the state and the plant’s owner. On December 23, Entergy and the state of Vermont announced a deal that will end all litigation surrounding the plant’s operation, shut down the plant at the end of 2014, and lead to a compressed schedule to study decommissioning.
The conflict started when Entergy sought a 20-year license renewal to keep the Yankee plant operating into the 2030’s. Vermont, however, requires approval from the state legislature for license renewal, the only state in the country that does so. Yet Entergy sued the state, arguing that authority over nuclear license renewals rests only with the Nuclear Regulatory Commission (NRC), and that federal authority trumps state authority.
Although a series of court decisions affirmed Entergy’s position, the company ultimately decided to close the plant anyway, largely due the inability to compete with cheap natural gas. In August 2013 it announced that it would cease operations at the end of 2014.
The single-unit 605-megawatt Vermont Yankee plant accounts for about three-fourths of the state’s electricity generation – the largest share in the country. Vermont also imports a significant quantity of hydroelectric power from Canada. Together nuclear and hydropower allows Vermont to rank lowest in greenhouse gas emissions in the nation.
Vermont has banned hydraulic fracturing and produces no natural gas. It imports some natural gas from Canada, but still consumes the second lowest amount in the country. That is set to change with the closure of Vermont Yankee. Vermont will increasingly rely on power plants from out of state, leaning more heavily on the New England grid. With the abundance of shale gas in states like Pennsylvania and Ohio, New England is adding pipeline capacity to bring that gas to market. Vermont has a goal of sourcing 75% of its electricity from renewable energy by 2032, but in the short-term, the Yankee closure means an increasing reliance on natural gas for Vermont, and higher emissions as a result.
The deal to close Vermont Yankee does offer a useful model for decommissioning as it tackles some of the key areas of conflict between the industry and the areas in which it operates. Entergy agreed to complete a decommissioning study in one year, much quicker than the four years allotted for by the NRC. It also agreed to move nuclear waste from onsite pool storage into dry casks within seven years, even though the NRC allows the company to keep waste in pools for sixty years. The deal also calls for Entergy to pay millions of dollars to the state for economic development for the county in which Vermont Yankee is located.
One of the interesting features of the deal is that it allowed for active involvement of the state in shaping the path towards decommissioning and waste disposal, which is often absent elsewhere. To be sure, huge question marks remain, including how the state will makeup for the shortfall in electricity generation, and where funding for decommissioning will come from. But, the U.S. has thus far failed to implement a strategy to decommission old nuclear power plants. And with most of the 100 or so nuclear power plants obtaining 20-year license renewals, that conversation has been pushed off into the future. The Vermont Yankee deal, while incomplete, does offer lessons for decommissioning.
By. Nicholas Cunningham of Oilprice.com
The Decommissioning money will come from the plants Decommissioning Trust Fund, collected on a pay as you go basis for every kw-hr sold.
All the agreement with the state does I get the state to stop opposing the plant, and support it before the Public Service Board.
The agreement between the State of Vermont and Entergy Corporation is contingent upon its acceptance by the Vermont Public Service Board and its issuance of a Certificate of Public Good by March 31. While it is likely there is no case which the PSB would rather clear from its docket than this one, even if it does accept the agreement, Entergy’s corporate ethic virtually guarantees a contentious battle with the state well into the future as the terms of the agreement are implemented. I emphasize “if,” because there are many reasons the PSB may reject the agreement, particularly because while the agreement insists that no conditions be added to or removed from the agreement, there are many areas of concern around decommissioning which are not mentioned or made clear in the agreement. Does their exclusion from the agreement exclude them from further consideration?
Public comments on both sides have suggested a time frame of seven years to move the spent fuel rod assemblies into dry cask storage, but there is nothing in the agreement which determines exactly when that process is to begin. Indeed, as Bill Mohl, president of Entergy Wholesale Commodities notes, “This agreement makes clear that Vermonters need not be concerned that Entergy VY will delay decommissioning and related activities longer than necessary once we determine that the decommissioning trust fund has adequate money to complete these tasks.” As both the “decommissioner” and the “determiner,” Entergy seems to be holding all the cards in this regard.
Further, what if there is a downturn and the decommissioning fund fails to perform as expected? The final figure for decommissioning may well be double what is in the fund now. Aside from payments into a site restoration fund, an economic development fund, a clean energy fund and outstanding taxes, most of which were already agreed to, does the parent company have any further responsibilities for the LLC which owns and operates Vermont Yankee now?
It should be noted that Entergy has had no contracts with any Vermont utilities for a year now. Not one light bulb went out as a result, despite dire warnings from all corners of the nuclear power industry and ongoing reports of the difficulties of Vermont’s transitioning to other power sources. Yes, Vermont no longer ranks lowest in the nation for greenhouse gas emissions.
The deal to close Vermont Yankee, if there is a deal, is not likely to provide a broadly useful model for decommissioning efforts elsewhere. It is the first test of a merchant reactor closing down, so there will be lessons in that regard. But the main reason the State of Vermont is so directly involved in this process of decommissioning and waste disposal is because it demanded it in the original Memorandum of Understanding accompanying the original sale of the plant to Entergy Corporation. No other state has such an agreement with any of the 25 or so remaining merchant plants in the nation.
Not that this agreement has prevented Entergy at different times over the years--to suit its agenda at any particular time and at all times in general--from claiming federal preemption in all areas of operating the plant from cradle to grave. There is nothing to suggest that Entergy has changed its ways or that the citizens of Vermont and the environs of Vermont Yankee don’t have a long, and contentious, road ahead of them.