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Entergy details spending of decommissioning trust fund

Company withdrew $58 million in 2015; fund decreased 10 percent last year

VERNON—Entergy spent $58 million from the Vermont Yankee decommissioning trust fund in the first year after the Vernon nuclear plant’s shutdown, the company disclosed.

Overall, with investment income and trust administrative expenses figured in, the fund decreased by about $69 million in 2015 — from $664.56 million to $595.4 million at year’s end.

Administrators said the new figures show that Entergy is in compliance with the federal Nuclear Regulatory Commission (NRC) and is on track financially in the early stages of Vermont Yankee’s decommissioning.

“The good news is, we’re still well above the NRC required minimum balance for the trust,” said Joe Lynch, Entergy Vermont Yankee’s government affairs manager. “And we are under budget, overall.”

Entergy ceased producing power at Vermont Yankee in December 2014 and is preparing the site for a period of extended dormancy called SAFSTOR. Decommissioning can take up to 60 years under that program, though the actual schedule depends in part on the growth of the plant’s trust fund.

Entergy has estimated that decommissioning Vermont Yankee will cost $1.24 billion. The trust fund contained a little over half that sum when the plant shut down, and Entergy in early 2015 began spending fund money on a variety of operational expenses, including salaries and utilities.

The trust fund has been the subject of much debate. Vermont officials have challenged several of Entergy’s proposed fund uses, and they are particularly upset that the NRC decided to allow the company to withdraw fund money for long-term management of Yankee’s spent nuclear fuel.

The state has filed a lawsuit and a hotly contested petition seeking to block that use.

But the NRC says its reviews show that there will be enough money both for decommissioning and for spent fuel management at Vermont Yankee. Those reviews are ongoing.

In January, the commission’s staff issued a memo saying Entergy Vermont Yankee and a long list of other plant owners had provided “decommissioning funding assurance” in their most-recent reports.

It can be difficult to draw conclusions from short-term changes in Vermont Yankee’s decommissioning trust, given market fluctuations and monthly withdrawals that factor into the bottom line.

However, Entergy’s new numbers provide a clearer picture of trust-fund spending at post-shutdown Vermont Yankee.

Spokesman Marty Cohn said the company withdrew $58 million in 2015, while trust expenses (mostly taxes) further decreased the fund by $16 million and investment income increased it by $5 million.

Lynch said that investment return is in line with expectations.

“The trust is very conservatively invested, so we wouldn’t expect to see huge swings” in the fund’s value, he said.

Overall, Entergy administrators continue to say their post-shutdown Vermont Yankee spending has been lower than anticipated.

While Lynch didn’t have an updated budget number, Vermont Yankee Site Vice President Chris Wamser said in November that decommissioning work was about $5 million under budget.

As Lynch reviewed 2015 plant statistics in preparation for the latest episode of “SAFSTOR Matters,” Vermont Yankee’s local television show, he said there are several factors driving the below-budget trend.

First, he said an on-site committee is “rigorously” reviewing every decommissioning cost proposed at the plant and is seeking competitive bidding for that work.

At the same time, Lynch said Entergy is committed to hiring local contractors and vendors.

“We are very focused on using local labor and local companies where possible, and frankly, by doing that, we save a lot of money,” Lynch said.

He also said Vermont Yankee’s payroll has been below budget because the plant’s workforce has been lower than expected. Staffing was cut from 550 just before shutdown to 316 in January 2015, and that number has dropped to 282.

“People have left on their own that we didn’t anticipate, so therefore those costs (have been reduced),” Lynch said.

Vermont Yankee is planning to further reduce its workforce to about 150 in May, due to NRC-approved emergency changes at the plant.

Finally, Lynch said Entergy has continued “draining and laying up” systems that are no longer needed at the plant. There are about 50 such systems; by the end of 2015, Lynch said, 35 of those had been shut down.

Such changes are important financially because, unlike when the plant was operating, Vermont Yankee now gets electric bills from Green Mountain Power. Lynch said those bills during 2015 had been exceeding $100,000 per month, and Entergy has enlisted Efficiency Vermont to try to find additional ways to cut utility costs.

“I know we’ve been making a very focused effort to get these (unused) buildings ‘cold and dark,’ and that’s reduced our electric bill,” Lynch said. “Anytime we can use (Efficiency Vermont’s) expertise ... it always helps.”

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Originally published in The Commons issue #342 (Wednesday, February 3, 2016). This story appeared on page A4.

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