It's the Renewables, Stupid? Vermont Files a Brief

Attorney General Sorrell

Opponent Rhetoric in the Past

Long before the lawsuits, Howard Shaffer and I would attend various committee meetings, rallies, and so forth.  Opponents would always say: "We must shut down Vermont Yankee so we can build renewables!"  Or similar words to the same effect.

Howard and I would shake our heads in wonder.  These statements were the merest rhetoric.  In reality, the existence of any particular power plant does not prevent or encourage renewables.  As a matter of fact, Vermont Yankee contributions to the Clean Energy Development Fund paid for much renewable development in Vermont.  Still, VPIRG especially made a point of "We must close Vermont Yankee so we can build renewables!"

Sorrell Borrows the Rhetoric to File A Brief

Fast forward to the brief that the State of Vermont filed in appeals court on Monday of this week.  They have borrowed the old VPIRG rhetoric as the main basis for Vermont's appeal.

Starting on page 17, the brief shows that the state has had energy plans since the early 80s, all the plans encouraged renewable energy, renewable energy has always been important to Vermont, and...wait for it...Act 160 about Vermont Yankee was a mere sunset-provision procedural law about energy planning for the state (page 25):

Under this framework, Act 160 is not preempted because it is a process statute — as relevant here, a sunset provision — by which the Legislature granted itself a role in deciding whether Vermont Yankee would continue to operate past the date on which its existing licenses were set to expire. Act 160 sets forth the Legislature’s purposes for making this change to the CPG renewal process, and those purposes are consistent with decades of Vermont energy policy:

In other words, the state wants to shut down Vermont Yankee in order to build renewables.

There's more the 78 page brief than this, but this is the crux of it, in my opinion.    When I linked to the brief from the Save Vermont Yankee FB page, I wrote:

Direct link to the Vermont AG appeal of the pro-VY ruling. Appeal starts with statements that Vermont wants renewables, not fossil or nuclear, and it says so in the Vermont energy plans! So they can shut down any non-renewable plant they choose, maybe? That seems a very weak argument, but hey, I'm no lawyer.

Sarcasm alert:  I wonder how the general rejoicing at Gaz Metro/GMP purchase of electricity from Seabrook Nuclear power is going to play in court..  I have a blog post about that: Nimby and Nukes. Also, Shumlin applauded the Seabrook deal because "cheap power makes a real difference." They tried to shut down VY to build renewables? Really? Just askin'...

My photo:
base of turbine at Lempster wind farm

A Lawyer Mostly Agrees with My Assessment


Don Kreis of Vermont Law School has an excellent blog post, mostly agreeing with my assessment.  State to Court of Appeals: Act 160 Just a “Process Statute”.  I wrote my note about Vermont's brief on FB ('seems a very weak argument") on Tuesday, June 5, and Kreis posted on Wednesday June 6.  Great minds think alike!  I am always pleased when a knowledgeable lawyer agrees with my assessment of a court action.

Kreis's post is worth reading.  It covers a lot more ground than my comments do, including the fact that Attorney General Sorrell  has hired a high-powered D.C. law firm to assist Vermont in its case. However, the Vermont argument gets back to the same thing: the legislature now says they were just trying to get some renewables going, not anything pre-empted. They were shutting the plant to build renewables! They weren't regulating radiological safety, heavens no!

I quote part of Kreis concluding paragraph:

But this begs the ultimate question, which is:  If Act 160 was not an effort to regulate radiological safety, then what was its purpose?  The idea that it was merely a “process statute” and a “sunset provision” is somewhat difficult to accept, at least on first read

Kreis also says that further arguments may indeed reinforce the AGs view of Act 160.  I do not want to put words in his mouth....Kreis and I agree only partially. I recommend his post for a fuller explanation of his views.  Also, he starts with an amusing and sarcastic look at possible legal implications of the Seabrook purchase.

My Assessment of the Brief

Since the legislators were okay with buying nuclear power from Seabrook, and they talked (a lot) about tritium at Vermont Yankee...what were they regulating?  This was no mere "sunset provision." In my opinion, the Vermont legislators were regulating radiological safety and such regulation is pre-empted by the federal government.

Vermont can hire expensive lawyers with taxpayer money. However, in my opinion,  Act 160 and the vote were about radiological safety, not about renewables.  I am sure Entergy will make that case in its rebuttal. And the court cases go on....

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By the Way: Please "like" the Save Vermont Yankee Facebook Page.

Also: Act 160 was the act by which the legislature, not the Public Service Board, decided whether Vermont Yankee would get a Certificate of Public Good from the state of Vermont.

District Court Upholds the Rule of Law. Guest post by George Angwin

From her hospital bed, Meredith asked me to post a brief note about and link to Judge Murtha's ruling today on the Entergy challenge to the Vermont legislature. The ruling essentially enjoined the State of Vermont from enforcing attempts to close the plant or cripple its operations.

I have paraphrased below the key conclusions of the ruling. Its full text is at

http://www.vtd.uscourts.gov/Supporting%20Files/Cases/11cv99.pdf

Judge Murtha ordered:

1. The State shall not enforce Act 160 to compel Vermont Yankee to shut down after March 21, 2012, because it failed to get legislative approval for a Certificate of Public Good.

2. The State shall not enforce the provision of Act 74 that requires legislative approval to store spent nuclear fuel after March 21, 2012.

3. The State shall not condition the continued operation of Vermont Yankee on requiring that it sell power to Vermont utilities at rates below wholesale market rates.

My street-talk version of these injunctions is that Judge Murtha is telling the State of Vermont that:

1. You cannot unilaterally change the terms of the 2002 contract between the State and Vermont Yankee.

2. You cannot use the spent nuclear fuel to shakedown Vermont Yankee.

3. You cannot extort ruinously low wholesale rates for Vermont Yankee power.

This ruling re-affirms the rule of law, which is the basis of our prosperity and our freedom.

Personal: Meredith's operation went well, and I expect to bring her home tomorrow.

Act 160 and Local Liars: A Review of the State's Role in the Entergy Lawsuit

Act 160 is the Vermont law passed in 2006 that gives the legislature the power to refuse a Certificate of Public Good to Entergy, therefore preventing the plant from operating past March 2012. This law was a substantial amendment to the agreement (Memorandum of Understanding) that Entergy had signed in 2002 when it bought Vermont Yankee. That Act 160 substantially changed the contract is one basis for the Entergy lawsuit.

Immediately after the suit was filed, Peter Shumlin claimed that Entergy had supported Act 160. He was surprised that Entergy went back on what they said at the time and sued about something they supported. You can see him saying this in the following clip from True North Reports. The part about Act 160 starts at about the 3.40 minute mark.

In a blog post in late April, I said that Entergy had not supported Act 160. In that post, I referred to my search for evidence that Entergy had supported Act 160. I found only evidence that Entergy had fought it, albeit without a lot of flair and energy. I found a few quotes from Brian Cosgrove of Entergy opposing Act 160. In that blog post, I asked people to give me more evidence about Entergy and Act 160 if they could find it.

On May 8, the Times Argus published a front page article, written by Peter Hirshfeld, titled "Who Said What? And Does It Matter?" The article is unfortunately behind a paywall (I can't link to it) but Hirshfeld found Brian Cosgrove of Entergy making the same negative comments about the bill that I reported in my blog post. Hirshfeld found more evidence, though. In four hearings about the bill, he found that Entergy lobbyists said very clearly that Entergy did not support the bill. On March 2, 2006, lobbyist Gerry Morris said: "This is my third time testifying on this issue and...we still oppose the bill."

Ignorant? Falsehoods?

Since Shumlin said Entergy didn't oppose Act 160, he is either ignorant, or he is lying. ( I will let you choose whether he knows what happens in the Statehouse, or he doesn't.) As John McClaughry notes in a post: Shumlin's statement about Entergy supporting Act 160 is simply not true.

I have begun to think that when Shumlin accuses somebody else of lying, that's a psychological signal that he himself is about to tell a whopper. (Hey, we bloggers can be parlor shrinks if we want to be!)

And the Legislature Lies, Too

The legislature breaks its own laws, while accusing Entergy of not respecting the law. If you remember, the Senate voted to not-allow the PSB to issue a Certificate of Public Good to Vermont Yankee. This vote took place in February, 2010. An election was held this fall, the legislature reconvened, and they never took up Vermont Yankee as an issue in the 2011 session. They acted as if that vote in February 2010 was the official and correct response to their own law, Act 160.

It wasn't official and it wasn't correct. As John McClaughry (head of the Ethan Allen Institute) points out, the legislature broke its own law. McClaughry, a former Vermont Senator, wrote a letter to the Speaker of the House and the President Pro Tem of the Senate, and sent a copy to True North Reports, which published it as The State, not Vermont Yankee, Violating the Law. Act 160 says:

“the general assembly shall consider concurrently the issue of storage of spent nuclear fuel… and the operation of Vermont Yankee nuclear power station after March 21, 2012 ,… and shall grant the approval or deny approval of such activities concurrently”.

As John continues: "A plain reading of this statute requires that the general assembly – House and Senate, in the same biennial session – must either grant or deny approval for spent fuel storage and continued operation of VYNPS."

They didn't vote. It's a new session, newly elected legislators, and they didn't vote. Only the Senate voted, last session. The "general assembly" did not vote. Act 160 does not allow the legislature to do a pocket veto of the plant. The legislature broke their own law.

Ah well. The legislators' pants are on fire, but luckily, I live about fifty miles from Montpelier so the flames won't affect me. However, their foolishness might help Entergy win its lawsuit against Vermont, and that would be a Good Thing.

(Full disclosure. John McClaughry is head of the Ethan Allen Institute, and my Energy Education Project is a project within that Institute. McClaughry and I are in agreement on the role of Vermont Yankee for the future of Vermont's energy. (He would never have let me start the Energy Education Project as part of the Ethan Allen Institute if we hadn't agreed on this.) However, since some people in Vermont see the Ethan Allen Institute as part of a vast conspiracy, I might as well point out my connection explicitly. True North Radio also gets some funding through the Institute.)

Entergy and Vermont Part 1: Act 160

The Entergy lawsuit is a story that will play out over time. Instead of attempting to look forward very far, I thought I would look around a bit at the issues, and even look backward. This is the first of a series of posts.

Act 160: Looking Around

One of the important points in the Entergy lawsuit is the claim that the State of Vermont changed the Memorandum of Understanding (MOU) by passing Act 160. Entergy signed the MOU when it bought Vermont Yankee in 2002. In the MOU, Entergy agreed that it would require a Certificate of Public Good (CPG) from the Public Service Board to continue operating the plant past 2012.

In 2006, the legislature enacted Act 160, saying the Public Service Board could not grant a CPG without legislative approval. This Act was a material change to an already-signed contract. Act 160 took the authorization of continued operation from the hands of the Public Service Board, and gave it to the legislature.

Act 160: Looking Backward

Snarky anonymous emails to this blog, statements by staff of the New England Coalition, statements by long-term opponents of Vermont Yankee in the legislature--the opponents claim the same thing: "Entergy supported Act 160! How can they fight it now?"

Well, Entergy didn't support Act 160. They didn't fight it actively, but they didn't support it.

I have looked high and low for Entergy comments at that time, and all I come up with is relatively mild negative comments, like this one from Brian Cosgrove:

Entergy officials also complained that the bill would be redundant when paired with last year’s action.

“That just seems excessive,” said spokesman Brian Cosgrove. “I think the Legislature already has a major role in license extension. There’s no way Vermont Yankee can continue to operate beyond 2012 without the Legislature’s approval for dry cask storage"

This is a quote from an Associated Press article by Ross Sneyd, printed in the March 15, 2006 Brattleboro Reformer, entitled “Lawmakers seek final say on VY relicensing."(see note below)

Entergy did not support Act 160. I suppose Entergy might have fought it, if they had possessed a crystal ball to the future. They apparently did not fight it. On the other hand, they did not support it. Anybody who says Entergy supported Act 160 is either mis-informed or has some evidence that I could not find.

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Note: The newspaper record from 2006 about Act 160 is not available on-line. I obtained some pdfs of old newspapers from the library. If you think Entergy supported Act 160, please send me your evidence. If you want to research the issue, you can go to your local library and look for microfilms of newspapers from around March 15, 2006. If you can find any statement by an Entergy spokesperson supporting Act 160, please send me a copy of the article. Thank you.

John William Waterhouse The Crystal Ball, from Wikimedia

Entergy Files Suit

This morning, Entergy filed suit to keep the plant open by requiring Vermont to honor its signed contracts. The State of Vermont signed a Memorandum of Understanding with Entergy in 2002. The State has attempted to amend that contract on a one-sided basis. Entergy's lawsuit was described in a Burlington Free Press article this morning. You can also download the filed lawsuit here.

According to the Memorandum of Understanding (page 6) the parties "espressly and irrevocably decree that the Board (Public Service Board) (1) has jurisdiction under current law to grant or deny approval of operation of VYNPS beyond March 12, 2011."

However, in 2006, the legislature voted that the PSB could not issue such a certificate without legislative approval (Act 160). This was basically a one-sided change to a written contract. There are tons of precedents that one side cannot change a contract without the other side's approval. Let's see the list of such precedents.

1. There's the Parol Evidence Rule for ordinary contracts. The written contract is the ruling document.
2. But this is a state, right? According to the Supreme Court, even states can't break contracts. This goes back to the Fletcher v Peck case of 1810, where a state attempted to pass a law that invalidated a contract the state had already signed. In 1810, the Supreme Court said the state could not do that. The precedent stands. (Last year, I noted this precedent in my blog post The Day After.)
3. Finally, there's the U.S. Constitution. According to Article 1, Section 10, no state shall pass any Bill of Attainder, ex post facto Law, or Law impairing the Obligation of Contracts.

According the the Vermont Yankee press release, there are further precedents, not closely related to Act 160. (Note, the precedents cited above are my opinions, not taken from Entergy documents.) Here's a quote from the Entergy press release about some nuclear and interstate commerce law precedents.

• Atomic Energy Act Preemption. Under the Supremacy Clause of the U.S Constitution, the U.S. Supreme Court held in 1983 in a case involving Pacific Gas & Electric that a state has no authority over (1) nuclear power plant licensing and operations or (2) the radiological safety of a nuclear power plant. In violation of these legal principles, Vermont has asserted that it can shut down a federally licensed and operating nuclear power plant, and that it can regulate the plant based upon Vermont’s safety concerns.
• Federal Power Act Preemption and the Commerce Clause of the U.S. Constitution. Vermont is prohibited from conditioning post-March 2012 operation of the Vermont Yankee Station on the plant’s agreement to provide power to Vermont utilities at preferential wholesale rates. The Federal Power Act preempts any state interference with the Federal Energy Regulatory Commission’s exclusive regulation of rates in the wholesale power market. The Commerce Clause of the U.S. Constitution bars a state from discriminatory regulation of private markets that favors in-state over out-of-state residents.

The Governor

Not surprisingly, it comes down to Shumlin again.

Another quote from the press release:

In a meeting with Entergy representatives on March 30, 2011, the governor reiterated his firm opposition to the operation of Vermont Yankee after March 21, 2012.

Ah well. At least he's consistent, I suppose. He campaigned against Vermont Yankee, and he was losing. Then he began campaigning on reproductive rights and healthcare and sneaked to victory.

Was I Behind the Curve on This?

Sometimes, I think I am the last person to know these things. Do you remember this chart of Vermont's Committed Resources that I put in my blog about a week ago? The chart comes from a Department of Public Service presentation from March of this year. Note that Vermont Yankee electricity supply doesn't end on March 21, 2012, but continues for a while. If there's a lawsuit, the plant can almost certainly keep running while the suit continues. Why didn't I notice this aspect of the chart before?

Update: Joffan is quite right in his comment. This chart shows VY supplying similar amounts of power in 2010 and 2011, one-fourth that amount of power in 2012, and no power in 2013. I misread it. However, I am going to leave the chart in place because it shows how Vermont depends on Vermont Yankee (2000 out of 6000 GWh) and what a big gap would need to be filled.