Wednesday, April 23, 2014

The Public Service Board Order: Guest post by John McClaughry

John McClaughry

The Public Service Board (PSB) has approved the memorandum agreement between the Public Service Department and Entergy, dealing with closing down Vermont Yankee. PSB approval was given over the vocal protests of the New England Coalition people.

The PSB approved Yankee’s operation until the end of this year, noting gratuitously that it might well have demanded a shutdown if there was any prospect of the plant continuing beyond then.

The Order spent a lot of space discussing what it considers to be a “fair partner” with the state. It described what it called Entergy's "corrosive and bullying attitude  and said that Entergy had made "frivolous arguments to resist valid discovery.” Well, I admit that Entergy made some mistakes that it should not have made in its presentations to the Board.

 But what is curious to me is the Board’s totally ignoring the effect of the 2006 legislature’s  passing Act 160, the law that destroyed the 2002 memorandum of understanding between the state and Entergy. Act 160 is mentioned only once, and only in passing, in the 84 page order.

 So tell me: What kind of “fair partner” was the State of Vermont, when it irresponsibly turned the plant’s future over to legislative control, based on no standards at all? This was outrageous, and the Federal courts overturned it six years later. The Public service Board  harped on Entergy’s procedural shortcomings, but ignored the state’s far more severe misbehavior.

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This post first appeared as a radio commentary on WDEV on April 21, 2014.

John McClaughry is a founder and current vice-president of the Ethan Allen Institute. Meredith Angwin is head of the Energy Education Project, which is part of that institute.

Wednesday, April 16, 2014

The Public Service Board Rewrites History

Pressing Control-H?
A petulant Board says Entergy is not a fair partner.

In granting the Certificate of Public Good (CPG) for Vermont Yankee to operate for a final year, the Public Service Board (PSB) stressed that Entergy had not been a "fair partner" to Vermont.  I considered the Board's assertions misleading and petulant.

My recent post on this subject was PSB and the Certificate: Powerless and Petulant. I ended that post with a question: "Well, did the Board have good reason to believe Entergy was not a fair partner?  Or were they just being petulant, as I claim?"  In this post, I begin to answer that question.

Let's start with the Board's rewrite of history.

As usual, here's a link to the Board's order approving the Vermont Yankee CPG.  http://psb.vermont.gov/sites/psb/files/orders/2014/2014-03/7862%20Final%20Order.pdf 

Rewriting History


The Board is made up of lawyers who were not under oath ("the whole truth") on a witness stand.  They were writing an opinion. Without an oath to tell the truth and the whole truth, they could omit important history from their opinion.  And they did.

If you asked an average Vermonter about Vermont Yankee's history, he would probably say something like: "Well, the legislature voted against the plant but then that vote was overturned by the court."

The PSB chose to forget this part of the history.

What the PSB mentioned

Let's look at page 28-29 of the ruling. This is extracted from the rulings history-chronology which is a background to this order.  I will summarize a few items, quote a few items (in italics). You can read the rest if you follow the link to the ruling. 

Item 6: 2002, Board approves sale of plant to Entergy
Items 7 and 8: 2006, Board approves construction of Dry Cask Storage and Power Uprate
Item 9: 2011, Entergy receives a license extension from the Nuclear Regulatory Commission.
10. On March 3, 2008, Entergy VY filed a petition with the Board seeking authority to continue operation of the VY Station for an additional 20 years through March 21, 2032. Docket 7440, Petition of 3/3/08 at 2.55
11. On January 19, 2012, the United States District Court for the District of Vermont issued a decision holding that provisions of Act 160, codified at 30 V.S.A. § 248(e)(2), were preempted by the federal Atomic Energy Act, and enjoined the enforcement of these provisions. Entergy Nuclear Vermont Yankee, LLC v. Shumlin, 838 F. Supp. 2d 183, 243 (D. Vt. 2012),

What the PSB forgot to mention

Did you notice anything missing? The legislature passed Act 160 in 2006 requiring the legislature to allow the PSB to issue a CPG.  The Board didn't mention that.

Act 160 was a clear change to the contract that Entergy signed when they bought the plant. That contract said that the PSB had to consider whether the plant deserved a CPG.  The original contract said nothing about the legislature.  For information on this, I recommend John McClaughry's post: Can Entergy Trust the State?

The legislature took over the decision about issuing a CPG to the plant (by passing Act 160 in 2006).   The legislature discussed, at great length, the plant's nuclear safety. However, nuclear safety is a matter of federal jurisdiction, and the legislature knew this. The legislature used what Cavan Stone calls the Control-H defense. Basically, the legislature decided: "Let's use another word for safety."  We will hit Control-H and we will change that word.  See Cavan Stone's guest post The State and the Control-H Defense.

Having attempted to use other words for "safety," the Vermont Senate held a vote in 2010. This vote denied a CPG to  Vermont Yankee-- by refusing to let the PSB rule on a CPG.  Essentially, this vote ordered the plant to shut down in 2012.

Entergy then sued the state,  because the legislature had acted on the basis of nuclear safety. It is a federal prerogative to regulate nuclear safety. Entergy won that lawsuit. The state appealed, and Entergy won that appeal. This was embarrassing for the legislature, and maybe embarrassing for the PSB.

What the PSB was embarrassed to mention

I can read what the PSB wrote, but why they wrote it is forever a mystery.  Here's my opinion.
Governor Peter Shumlin
Led the Senate to vote against VY
(before he was Governor)

Neither the 2006 law nor the 2010 vote are mentioned in the PSB history.  Why not?  Is it because these show that the state of Vermont was not being a "fair partner"?  Is it perhaps because the legislature took the PSB's power away from it?  The legislature said: "You can't release your findings, PSB,  unless we legislators allow you to do so." To write about this, the PSB would have to admit another example of being powerless.  Was that the reason they didn't mention the vote?  Or was it that Entergy won the lawsuits, hands-down, and the PSB is basically lawyers who ended up on the wrong side?

Was the PSB just plain embarrassed at the whole history?

Who knows?  As I say, the PSB didn't write this opinion under an oath to tell the whole truth, so they wrote what they wanted to write. They left out the part of the history that most Vermonters would mention if asked about the history of Vermont Yankee.

I thought I would mention that history.

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Note: I have plans for more posts about the PSB ruling.

Thursday, April 10, 2014

PSB and the Certificate: Powerless and Petulant

Spillway at HQ dam
Vermont's source of electricity
On March 28, the Public Service Board (PSB) issued a Certificate of Public Good (CPG) for the final year of operation of Vermont Yankee. I quickly posted a preliminary review of the ruling:  Board Issues CPG to Vermont Yankee through 2014.  In that post, I noted that I had not yet read the entire 97 page document.

So now I have read it.  I think it was an appalling document for a "quasi-judicial" body to issue.  Feel free to read the nearly-100-pages yourself, especially if you want to go through a document page by page, rebutting half the sentences.

http://psb.vermont.gov/sites/psb/files/orders/2014/2014-03/7862%20Final%20Order.pdf

The Board Admits to Being Powerless

In August 2013, when Entergy announced it would close Vermont Yankee, many people noticed that the Public Service Board had just lost most of its power over the plant.

Opponents urged the PSB to put as many constraints as possible on the final certificate because it would be the state's last chance to regulate the plant.   Similarly, Vermont Business Magazine wrote that decommissioning of VY was a federal issue, and the state might have very little to say about it. This editorial suggested that a willingness to deal with Entergy in earlier days might have led to a better outcome about decommissioning. (My blog post Looking Back Toward Decommissioning covers this.)

Time went by, and in December 2013, the state and Entergy reached an agreement about the final year of Vermont Yankee's operation and about some aspects of decommissioning.  The agreement was  embodied in the Settlement Agreement and the MOU (Memorandum of Understanding). The PSB needed to accept or reject this agreement by the end of March, or the agreement would no longer be valid. (Reasons the Public Service Board  Should Approve the CPG for Vermont Yankee.)

On March 29, the PSB ruled. In its ruling,  the PSB admitted it was pretty much powerless to change the end date of plant operation, anyway. On page 4 of the ruling:  The value of these benefits [benefits of accepting the Settlement and MOU] is complemented by the short duration of the permission we are granting Entergy VY. This limited period of time is likely not longer than the interval of time we would have allowed Entergy VY for winding up its operations had we decided, in the absence of the MOU, to deny the Company's request to extend its time for operating in Vermont.

In other words, the PSB would have to grant VY about the same time to wind up operations whether the PSB ruled for or against the MOU.  So the PSB figured they might as well rule for the MOU, because the MOU included cash benefits to the state.

The MOU specified many payments from Entergy to various funds in the state of Vermont. Shortly after the Board issued the CPG, the first of these payments from Entergy arrived: two million dollars for community development to the state Agency of Commerce and Community Development.

Powerlessness Turns the Board Petulant

In my opinion, the ruling has many examples of petulance. My paraphrase of the ruling: "They ran that plant and they made power and they paid their taxes and everything....but they did us wrong.  They didn't play fair.  They are not fair partners. They didn't always give us the right information.  No they didn't.  Not every time. Okay, we know, they DID make power, but so what, huh?"

As Will Darlymple at Nuclear Engineering International said: this order was grudging at best, scathing at worst. In contrast, plant opponents were delighted with the tone of the order, as you can read in an opponent op-ed in The CommonsWhat was surprising is how loathe the Public Service Board was to grant Entergy “fair partner” status, as has been widely reported in the press.

The ruling is amazingly repetitive on the theme that Entergy is not a "fair partner" for Vermont.

Page 5 refers to the  The Company's sustained record of misconduct has been troubling to observe over the years and has continued to trouble us as we determine whether to grant Entergy VY a license to operate. If Entergy VY were planning to operate the VY Station for another twenty years as originally requested, its track record may well have led us to find that ownership and operation would not promote the general good.

This focus on Entergy "misconduct" continues on pages 31 to 44. These pages explain that Entergy cannot be a Fair Partner to the state. The "Fair Partner" section is by far the longest section in the ruling, including (page 41) the statement that  This history is troubling and falls well below the level of conduct the Board expects of utilities authorized to conduct business in the State.

In other parts of the ruling, brief sections mention that Entergy paid taxes, made power reliably, gave the state Nuclear Engineer access to the plant, etc.  But the longest section is about "Entergy was not a fair partner."

Not a "Fair Partner" or a Petulant Board?

Well, did the Board have good reason to believe Entergy was not a fair partner?  Or were they just being petulant, as I claim?

The Board's reasons for saying that Entergy was"not a fair partner"  were basically wrong. Entergy was not perfect, but "not a fair partner" is an over-the-top judgement for the flaws that Entergy had. However, it will take at least one more blog post to show this. You can't answer 97 pages in a short blog post!

My follow-on posts are partially drafted.  But like the Board ruling, this present post is....long enough.

UPDATE:  Howard Shaffer has just posted a more complete assessment of the ruling at ANS Nuclear Cafe: A Pyrrhic Victory in Vermont for Nuclear Power?   I encourage you to read it!

Tuesday, April 8, 2014

Predicting the 60 MInutes Fukushima Story: Guest Post by James Greenidge

Natural Gas facility fire
After Tohoku Earthquake
Photo is labelled:
 "Disaster at Fukushima" 
On April 6, CBS 60 Minutes planned to broadcast a segment about the ghost towns of Fukushima. Meanwhile, on April 4, ANS Nuclear Cafe blog was featuring a blog post about Vogtle construction progress. However, the moderator at the ANS blog made a comment on the ANS Vogtle post. The moderator wanted to give readers a heads-up about the upcoming 60 Minutes Fukushima program.

James Greenidge answered the ANS notification with his own comment. Greenidge graciously gave me permission to use his comment as a guest post.

I quote below from the ANS Nuclear Cafe comment stream.
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ansnuclearcafe | April 4, 2014 at 14:46 |

60 Minutes video and story preview: http://www.cbsnews.com/news/60-minutes-returns-to-the-ghost-towns-of-fukushima/

James Greenidge | April 4, 2014 at 16:46 |

It will be the usual suspects of token and low-grade so-called nuclear consultants, and I’m sure CBS didn’t ring ANS or NEI or pro-nuclear blog pros for some cool calm reasoned insights. I vouch that this 60-Minutes broadcast will be somberly grim, with lots of flashes of tsunami damage and quake oil facility fires interspersed scenes of the nuclear plant in coyly tacit blame, and constant assertions of how “no one sane” can homestead here again or eat anything for generations or hundreds of years. There’ll be lots of scary bunny suits and water tanks leaking forever and crying babies being Geiger scanned.

Cosmo Oil Explosion in Japan
From Wikipedia
There will be no comparative background rad rates with other areas around the world and there will be less stress that a super-rare earthquake incited the incident and instead more of an undertone that there is something inherently flawed in all nuclear reactors behind the event which would’ve occurred eventually anyway.

There won’t be any public or worker mortality rate comparisons with other industries and there won’t be any mentions as to old-designed reactor robustness containing three meltdowns in a row when the media has long predicted that just one is Doomsday, and the report will mute down that no one was killed and attribute that to divine luck.

They will lump every nuclear plant that exists as clones of Fukushima and you have one which just can’t wait to blow in your backyard. The show will end in a desolate looking pan of the Fukushima ghost town and landscape that is implied lost for a thousand years and maybe a sly glimpse of a windmill in the corner.

Then afterwards ask whether CBS did a _fair_ and non-alarmist accurate job or just suave cautionary FUD.

Hope I’m not a suspense spoiler!

James Greenidge
Queens NY

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I didn't watch the CBS show, but I suspect Greenidge predicted accurately.  Reader comments invited!

Speaking of comments, you might enjoy the comments stream on the original ANS post, including  comments from me and more from Greenidge.

Saturday, March 29, 2014

Board Issues CPG to Vermont Yankee through 2014

Public Service Board
David Coen, James Volz, John Burke
A Certificate while pouting

The Public Service Board issued a Certificate of Public Good for Vermont Yankee, to run through the end of 2014.  They did it with their usual insulting snark toward Entergy. As VPR quoted the Board order:

“In its 12 years of operating in Vermont, Entergy VY has failed to comply with numerous board orders and statutory requirements,” the board said. “It has failed to follow procedural requirements that protect the integrity of board proceedings. The company has engaged in unacceptable conduct that erodes public trust and its capacity to act in good faith and to engage in fair dealing.”

The board said that if Entergy had wanted a 20 year license extension, “its track record may well have led us to find that ownership and operation would not promote the general good.”

Why did I quote VPR's quote of the order? Why didn't I quote the order directly myself? Well, frankly, because I haven't read it.  This order is 97 pages long.  Here's a link:

http://psb.vermont.gov/sites/psb/files/orders/2014/2014-03/7862%20Final%20Order.pdf

As VPR quoted Shumlin: Gov. Peter Shumlin was also pleased with the decision. “The decision provides certainty and predictability for the hard workers at the plant, over $10 million of economic development funding for the region, and lets us focus on the important work of transitioning to a future after Vermont Yankee..

Well, that is enough for now.  My snark factor is rising, along with my blood pressure.  Gosh, Governor Shumlin cares about the "hard workers at the plant." Yeah, sure!

The Board makes its own bed

I am very glad that the Board ruled in a timely fashion, and they did not attempt to shut down the plant a few months early.
Canada, with Quebec highlighted

From my point of view, the members of the board can now go ahead and enjoy their pouting about Entergy's "unacceptable conduct."  I think the main "unacceptable conduct" was Entergy winning its lawsuits.

Hopefully, this is it. No nuclear plant will ever again have to deal with the Vermont Public Service Board.  Instead, the Board can enjoy trying to control the Canadian companies who supply Vermont's gas and electricity.

Over and out, and more later.

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Update: Rod Adams blog post about visiting Vermont Yankee is now also posted at The Energy Collective. It has generated a lively comment stream, including comments from

  • opponents from the Brattleboro area, 
  • Bas Gresnigt,
  • N Nadir, expert and blogger extraordinaire,
  • and several good people who are knowledgable about nuclear energy.

Join the conversation!

https://theenergycollective.com/rodadams/360846/what-waste-vermont-yankee-beautiful-condition

Friday, March 28, 2014

Closing Vermont Yankee is a Waste: Rod Adams post

Yesterday, Rod Adams of Atomic Insights visited Vermont Yankee.  His conclusion: Closing this beautiful plant is a waste.

http://atomicinsights.com/waste-vermont-yankee-beautiful-condition/

Please read, link-to, and circulate his post!

Thursday, March 27, 2014

Issues and Re-Issues on the way to a CPG for Vermont Yankee

The agreement

In December, Entergy and various state agencies signed an agreement about the final year of Vermont Yankee's operation, lawsuits, payments, and several issues concerning decommissioning.

If the Public Service Board (PSB) acts in favor of this agreement, Vermont Yankee will receive a Certificate of Public Good to operate to the end of this fuel cycle.  You can read more about this agreement in Guy Page's guest post: Reasons the Public Service Board Should Grant an CPG to Vermont Yankee, and my post The Proposed Entergy Settlement is Good for Vermont.

I hope this agreement will be ratified by the Public Service Board.

But the story is always longer and more complex than it first appears.

Issues and Re-Issues

1) Issue: The Ruling and the Timing
According to Section 2 of the Settlement Agreement, there's a March 31 deadline. If the Board does not grant Vermont Yankee a CPG that approves the continued operation of the plant through the end of the fuel cycle, and in accordance with the agreement terms, the agreement may terminate at the discretion of either party.   So we can expect to hear something from the PSB by Monday, March 31.
Re-Issue: BrinksmanshipLast year, when the Board had a deadline about a CPG for emergency diesels for Vermont Yankee, they waited till the last minute to issue the ruling. They played a game of brinksmanship, as I described in A Court Case with a Deadline: The Black Start Diesels.  Are they still playing this game, or will they rule?  We will know by March 31.
2) Issue: The Decommissioning Timing
When the agreement was announced, both sides stated that they had made an agreement on what they could agree upon, but other issues were not resolved. One particular issue is that the state wants fuel moved from the fuel pools as soon as possible, but the state also wants the "real decommissioning" to begin as soon as possible.

So the state wants the fuel to be moved, but no decommissioning funds are to be expended to move it. As I noted in The Fuel Pools: Opponents Say the Darndest Things Attorney General Bill Sorrell plans to "take legal action" if Entergy removes money from the fund in order to move the fuel rods.
Re-Issue: Pre-Emption Sorrell says the state wants a "legal opportunity to be heard on those requests."  In this case, "those requests" are Vermont Yankee requests to the NRC for permission to use decommissioning funds for fuel management. Of course, this is a traditional use of decommissioning funds.   
Does the state truly want to get into a court battle about regulating nuclear operations and safety? Didn't they learn something by losing two court cases?
3) Issue: Will the State Obey the Law?
Okay, let's assume the issues above are resolved nicely.  Let's say that the PSB rules on time, and they rule in substantial agreement with the Settlement Agreement.  Let's say that Attorney General Sorrell finally understands the term "federal jurisdiction over nuclear safety" and decides not to sue if Entergy uses decommissioning funds for decommissioning.  In other words, everything is great.

The question becomes: Will it matter? Will the state live up to its side of the bargain?

Re-Issue: The Shumlin Administration Regularly Breaks Its Own Laws
Earlier this year, John McClaughry wrote comments to the PSB: "Can Entergy Trust the State?" McClaughry explained that when the state passed a law giving the legislature a vote about Vermont Yankee's continued operation, this law was a clear breach of contract with Entergy. The law was a major and one-sided modification of the Memorandum of Understanding that Entergy had signed.  
In my opinion, the state is quite happy to break any law that inconveniences it.  This is not just about Entergy.  Governor Shumlin has been eager to pass a law for single-payer health care, and the law was passed. According to that law, the government had to propose a plan for financing the system, and the plan had to be presented to the legislature by January 15, 2013. It has still not been presented.  Estimates for the cost of the single-payer system range from $1.5 billion to $2.2 billion per year.  There are about 600,000 people in Vermont.  If the cost is $1.8 billion, that is $3000 per citizen.  A rather massive payroll tax has been proposed, and of course, everyone hates that idea.   
When Governor Shumlin was recently asked: "What else can we tax (besides a payroll tax  to finance this)?" Shumlin answered: "bubble gum and lollipops."  I encourage you to read Representative Tom Koch's Op Ed on this subject: A Governor Who is Above the Law.  I
 also recommend Rob Roper's commentary: Irreconcilable Differences in Single Payer Promises.  
Note for those who do not live in Vermont: this is not about the Affordable Care Act.  This is about a single-payer system that the state of Vermont, all by itself, plans to implement.
I don't want to get deep into the weeds of this controversy, but I just want to say that if Shumlin does not obey his own laws (the ones HE wanted to pass) about his own pet project, how is he going to treat the Entergy agreement?

Soon we will know

The PSB should rule by Monday, March 31, or the Settlement Agreement may become null and void.
  • The PSB may rule for the agreement, or they may rule against it, or they may stall and not rule at all.  
  • If they do rule for the agreement, the Attorney General may still sue Entergy for moving spent fuel from the fuel pool, and using the "wrong" money to do so.  
  • If all is well with the PSB ruling and the Attorney General, the state may simply ignore their obligations under the contract.

Welcome to Vermont politics. Stay tuned.  Oh yes.  Stay tuned.

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Acknowledgment: John McClaughry and Rob Roper are officers of the Ethan Allen Institute.  I am director of the Energy Education Project which is part of that institute.