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Neighboring states join Vermont in VY trust-fund fight

Entergy argues that the states have no regulatory or legal standing in the case

VERNON—Three states are joining Vermont’s quest for a “robust” federal review of trust-fund spending at the Vermont Yankee nuclear power plant.

In new federal filings, attorneys general for Connecticut, Massachusetts, and New Hampshire voice support for Vermont’s stance — outlined in a November petition — that decommissioning funds are being drained improperly.

Echoing Vermont’s concerns, the three states blame an “overly lenient” and “inconsistent” regulatory approach by the NRC.

The three attorneys general cite concerns about cleanup at Vermont Yankee, given their states’ proximity to the Vernon facility. But they’re also thinking about the future decommissioning of nuclear plants in their own states.

“While [Vermont’s] petition was filed to address issues at Vermont Yankee, it raises serious, never before adjudicated questions about the use of decommissioning trust funds that apply to every such fund in the nation,” the states’ filing says.

Entergy stopped producing power at Vermont Yankee in December 2014, and the facility is entering a period of prolonged dormancy called SAFSTOR prior to decommissioning.

One reason for the delay is the insufficiency of the plant’s decommissioning trust fund, which held $610.35 million as of Oct. 30. Entergy says decommissioning will cost $1.24 billion, and the company drew down the fund to cover expenses throughout 2015.

Vermont officials have protested several of Entergy’s planned trust-fund expenditures, arguing that they don’t fit the federal definition of radiological decommissioning.

The biggest battle is over whether the company can withdraw hundreds of millions of dollars for long-term management of spent nuclear fuel: The NRC has approved that use, but the state has objected via a lawsuit and the November petition.

That petition, filed by the Vermont Public Service Department and Vermont Attorney General Bill Sorrell, urges a “robust, comprehensive, and participatory review” of trust-fund spending at Vermont Yankee.

Entergy administrators and NRC staffers have responded by deriding Vermont’s petition as “alarmist,” “meritless,” and “vague,” to use just a few descriptors. They’ve asked that the commission dismiss it outright.

Wide-ranging ramifications

The chief prosecutors in Connecticut, Massachusetts, and New Hampshire see the situation differently, and they’ve jumped into the fray by filing a response in support of Vermont.

The attorneys general are urging the NRC to address Vermont’s concerns as soon as possible due to wide-ranging ramifications if decommissioning trust funds fall short at Yankee or at other plants.

“A decision to delay the resolution of these questions or, worse, a decision to adopt the NRC staff’s and Entergy’s positions, would threaten to undermine nuclear plant owners’ ability to remediate the radiological contamination at plants that have ceased operations and shift the burden of doing so to the states’ taxpayers,” the filing says. “For that reason, the commission must exercise its general supervisory authority to address these issues now.”

The filing notes that two of the involved states border Vermont and all three lie on the Connecticut River downstream from Vermont Yankee. Each state “could be directly harmed if Vermont Yankee is not decontaminated,” the document says.

Furthermore, the attorneys general argue that the nuclear-plant operators in their states should be required to take steps now — such as transferring spent fuel into dry casks — to ensure that “decommissioning trust funds will be used solely to pay for legitimate decommissioning activities” in the future.

A ‘dangerous incentive’

NRC staffers have defended their policies on trust-fund spending at Vermont Yankee, noting their stringent review practices and the fact that trust funds have been approved for spent-fuel management at other plants.

But the Connecticut, Massachusetts, and New Hampshire attorneys general are critical of such policies, saying the NRC has created a “dangerous incentive” for nuclear operators to lean too heavily on decommissioning trust funds.

“The NRC’s approach is inconsistent with its own regulations and threatens both the environment and public health and safety,” the states’ filing says.

In Massachusetts, another Entergy nuclear closure — the shutdown of the Pilgrim plant by 2019 — looms large. And so, apparently, do decommissioning concerns similar to Vermont’s.

Massachusetts lawmakers “are so concerned about the sufficiency of Pilgrim’s decommissioning trust fund that they have introduced a bill that would require any nuclear power plant [...] to pay annually $25 million into a state post-closure fund,” the three states’ filing says.

Entergy: states have no standing

It is unclear, however, whether the consortium of New England attorneys general will be allowed to participate fully in Vermont’s trust-fund fight.

Entergy has responded to that attempt to intervene, arguing that those three states have no regulatory or legal standing in the case.

The company also says the three states are improperly trying to push for a bigger debate about regulations for operating nuclear plants. It also argues that the three states are “proffering a wide variety of new topics — from proposed legislation in Massachusetts, to letters from the New York attorney general’s office, to arguments about corporate structure — none of which were the subject of or even mentioned in the original petition, contrary to NRC requirements,” Entergy says.

While the NRC didn’t directly respond to the states’ claims, Entergy’s filing says the agency’s staff “agrees that the pleading filed by the commonwealth of Massachusetts and the states of Connecticut and New Hampshire is procedurally defective.”

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Originally published in The Commons issue #340 (Wednesday, January 20, 2016).

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