There is No Jobs Bonus. Decommissioning Helps Long-Haul Truckers But It Destroys Local Communities.

Decommissioning Plans, Made by Nuclear Opponents

A recent post described the new taxes that Governor Shumlin's administration wants to place on Vermont Yankee. There are two taxes, actually: one on fuel rods, and one to increase the decommissioning fund. Meanwhile, at ANS Nuclear Cafe, Howard Shaffer wrote about opponent tactics. Opponents plan to form new "affinity groups" with the same people as members, but new names for the groups. Decommissioning is a major focus of these groups.

It's also a major way for the opponent groups to salve their conscience about throwing hundreds of people out of work. "Decommissioning will be a jobs bonus!"

No. It won't.

Will Decommissioning Funnel a Billion Dollars into the Vermont Economy?

In an early March press conference, Governor Peter Shumlin called decommissioning Vermont Yankee “a huge jobs issue for us.” He wanted immediate decommissioning of the plant because it would “fuel $1 billion” into the Windham County economy over the next ten years.

The jobs Shumlin is describing are not jobs held by the current workers. As reported in an article in True North Reports and updated in this blog, more than 80% of the plant employees would be laid off within two years of plant closure, whether or not the plant is put into SafStor. There are 650 employees at the plant now: in two years, less than 100 employees would remain.

Though plant people would be laid off, contract labor would be brought in for decommissioning. What kind of payroll would the contractors bring to the area, compared to the payroll of the plant when it is operating?

The Contractors Come to Town

People who have lived through a local plant decommissioning say that the effect of contractors is not noticeable in the town. Bob Blagden, a selectman in Wiscasset Maine while Maine Yankee was decommissioned, said the “contractors must have picked up some people, but it wasn’t noticeable.” A long-time resident of the town, who did not want his name used, said “They may have hired some people, but this was nothing in comparison with what we lost.”

Are these people correct? Or is Shumlin correct in thinking decommissioning is a jobs bonanza?

The residents of Wiscasset are correct. It took some research to figure this out, but a best estimate is that the total salaries for contractors in the area would be about $20 million a year, while the plant has a payroll of $65 million a year. Decommissioning is a job cliff, not a job bonanza.

What is a Billion Dollars?

Before reviewing the question “would decommissioning fuel a billion dollars?” for Windham County, we have to ask what “fueling a billion dollars” means. Is this money straight payroll, or does it count “multipliers”?

The “multiplier” effect is the well-known economic calculation of how many other jobs are based on a group of steady jobs. For example, two economic studies of Vermont Yankee started with the fact that there are 650 employees at Vermont Yankee, and a yearly payroll of around $65 million An IBEW study in 2008 calculated that Vermont Yankee provided 900 “multiplier effect” jobs in the state, while a separate report prepared for the Vermont legislature in 2010 claimed Vermont provided about 700 multiplier-effect jobs. Both estimated a multiplier effect of at least two times the plant payroll.

Being conservative, we could estimate that Vermont Yankee adds a total of $100 million a year to the local economy (less than a times-two multiplier effect). At that rate, VY “fuels” one billion dollars to the local economy in ten years, and in twenty years (till 2032) it would fuel two billion dollars.

In comparison, how much money would the contract labor of a decommissioning project add to the local economy?

Decommissioning the Yankee Plants

The total expenditure for decommissioning Yankee Rowe, Connecticut Yankee, and Maine Yankee was $750 million, $500 million, and $850 million, respectively. (Data from a paper on “Lessons Learned from Decommissioning” by Wayne Norton, president of Yankee Atomic.). The projects took varying amounts of time, from 7 to 15 years, but let us assume they all took ten years, in parallel with the Shumlin time estimate. At that rate, expenditure rates on decommissioning were between $50 and $85 million a year, numbers similar to that of the Vermont Yankee payroll.

However, comparing total costs of decommissioning to payroll costs of an operating plant is an apples-to-oranges comparison. Most significantly, decommissioning a nuclear plant includes major expenditures outside of the plant locality.

Decommissioning a nuclear plant requires millions of pounds of slightly radioactive waste to be hauled to low-level waste disposal sites in the West. Maine Yankee shipped 460 million pounds of waste, and Connecticut Yankee shipped 350 million pounds. Container manufacturers, long-haul truck drivers, and waste disposal sites are the recipients of waste-disposal money, not the people in the towns near the plant.

How much money stays in the towns near the plant and how much goes to hauling and waste disposal sites? We can start by looking at the probable payroll (not total cost) of decommissioning.

The Zion Explanation

I could not ascertain the local payroll versus haulage costs for the decommissioning the Yankee plants. These numbers are proprietary to the companies that did the work, and I hit a dead end trying to find out. However, there's a current decommissioning project in Illinois. The company doing that project, EnergySolutions, was very helpful to me.

EnergySolutions is beginning to decommission the Zion Nuclear plant in Illinois. EnergySolutions has a Zion website partially devoted to showing that Zion decommissioning will bring economic benefits to the region. The accompanying pie chart is on that website. The EnergySolutions public outreach officer for the Zion project, Larry Booth, was also kind enough to send me the economic report on which the chart is based "The Economic Impacts of Decommissioning the Zion Nuclear Power Station." (The report is not on the web.)

On the pie chart, we can see that the salaries for the ten-year decommissioning process at Zion add up to $215 million dollars.

In more detail, page 14 of the Zion economic report has a chart of personnel. That chart is at the top of this blog post. Double-click to enlarge.

At its height, in years 2 through 5, there will be around 300 people on-site decommissioning the Zion plant. That is about half the number of people working at Vermont Yankee currently. The six other years, the staffing is much lower, down to five people in year 10. Clearly, decommissioning is not a ten-year jobs bonus for the site.

Much of the Zion economic project report is devoted to explaining the multiplier effects of the project. This is called “output” on the pie chart. In the report’s careful reasoning, $200 million in on-site salaries generates $600 million in other economic outputs over ten years. However, using that multiplier, $1.3. billion in salaries at Vermont Yankee ($65 million per year for twenty years) would add $3.9. billion in other economic benefits, for a total economic impact of $5.3 billion dollars over the next twenty years of operation.

Apples to Apples Comparison

The solid facts are that Vermont Yankee has a payroll of $65 million per year, and decommissioning Zion will be a payroll of $20 million a year. Decommissioning the Yankee plants probably had a similar payroll, since the people in town saw little economic benefit from the presence of the contractors. As one well-connected man from Maine said: “I didn’t know anyone who got a job there.”

By careful assessment of multipliers, the total economic benefit of any project can look excellent. However, comparing apples to apples (on-site salaries to on-site salaries) decommissioning a nuclear plant is not a jobs bonanza compared to continued operation of the plant.

The Jobs Cliff

Closing Vermont Yankee will push the current plant workers off a jobs cliff, as described in a previous article. It will push the local economy off a cliff also, despite the presence of contract laborers. The contract labor force can be expected to have only about a third of the payroll of the operating plant.

Shumlin says that decommissioning is a “huge jobs issue.” It is, indeed, a huge issue. Decommissioning will be a huge job loss for southern Vermont. The one clear financial beneficiary from decommissioning Vermont Yankee will be low-level waste disposal sites in the West, and long-haul truck drivers. Decommissioning will be a financial loss for southern Vermont. It will destroy the local communities and the local job base.

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A version of this blog post was published at True North Reports. I am grateful to Rob Roper for permission to republish it here.

87th Carnival of Nuclear Energy up at ANS Nuclear Cafe. Plus Some Other Announcements

The 87th Carnival of Nuclear Energy Bloggers is up a ANS Nuclear Cafe. Dan Yurman has once again put together a fascinating carnival.

There's a lot of information about mining and mineral extraction including: discussion of the decision not to mine uranium near the Grand Canyon (NEI Nuclear Notes), description of radiation releases from fracking (Nuke Power Talk), and description of China buying a uranium mine in Namibia (Next Big Future).

There's a review of The Conundrum, a book forecasting the end of energy availability. Atomic Insights wonders if the author has heard of uranium and thorium?

There's lessons from Fukushima: the Flex Strategy for nuclear safety (NEI Nuclear notes) and a new clean-up method for radioactive elements in soil (Next Big Future). There's new material development, too (Next Big Future).

New reactor deals are coming along (Idaho Samizdat) and there are new ideas of communicating about nuclear energy to women (ANS Nuclear Cafe). Meanwhile, here at Yes Vermont Yankee, there always seems to be a new lawsuit!

Other Announcements

Nuclear Science Education: National Nuclear Science Education Week starts on January 23, and I urge you to read about it at the Nuclear Science Week website. Also, a tip of the hat to Dan Yurman for his new bibliography of non-technical nuclear books. His list is a wonderful resource. I also recommend Will Davis post at Atomic Power Review on Nuclear Science Education Week, which includes links and information on getting speakers. Every day at Nuclear Science will will have a different topic, and Davis plans to cover these topics on a daily basis at Atomic Power Review. My own blog has a post about resources for high school students to learn about atomic energy.

Temporary Blog Changes: For personal reasons, I will be less available for about three weeks, starting Wednesday January 18th. There will be more guest bloggers than usual, though I will also be blogging. Also, comment moderation will be slower. Otherwise, things will be pretty much the same.

Every now and again I imagine reshaping this blog, with new formats, tabs to blog pages as well as posts, and so forth. Maybe, after three weeks of part-time blogging, I will be fired up enough to make changes! The daily grind does tend to grind down the idea of reformulating, rethinking, etc.

Taxing Fuel Rods: The Vermont Legislature Plans Another Law Which Will End Up in Court

The Vermont legislature is facing the fact that the Clean Energy Development Fund will cease to be funded when Vermont Yankee stops paying into it in March. This fund has paid part of the costs of many a solar panel and wind turbine. For the Vermont legislature, watching this funding go away is painful! Replacing this tax with another tax on Entergy is an important goal of the legislature, even mentioned by Governor Shumlin in a press conference that was mostly about recovering from Hurricane Irene.

So, the legislature coming up with another way to make Vermont Yankee pay into the clean energy fund. House bill H479 plans to tax spent fuel. The legislature must think these fuel rods are very valuable, because t they plan to raise tens of millions of dollars a year taxing them!

As usual in Vermont, this is almost certainly going to end up in court. The proposed bill H479 talks about nuclear plants in Vermont (plural). But there is only one plant. A tax aimed at only one company is usually illegal. However, as I pointed out in my post about the "Entergy must pay Vermont's Costs in the Lawsuit law, the Vermont legislature passes bills are illegal, unconstitutional, and can't be enforced. These bills make the faithful feel good. "We're doing something, even if it won't actually work."

The bill has two parts: a tax on fuel rods (amount unclear, perhaps $15 million a year) and a state-required decommissioning fund. The state-required fund ("post-closure funding tax") would require contributions of $25 million a year.

Howard Shaffer has an excellent post on this bill, which was published at True North Reports yesterday. His post: H479 Analysis: The Power to Tax is the Power to Destroy. Here's a quote from Howard:

Opponents have already circulated a petition to towns and cities within 20 miles of the plant, requesting support for a tri-state Decommissioning Oversight Committee. They intend to meddle, as they have elsewhere in New England. Their “contribution” consists of trying to get ridiculously low levels of radioactive contamination as cleanup standards. This has resulted in hauling off multiple truckloads of demolished concrete that pass granite boulders along the road that are more radioactive than the cargo.

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Image of dry cask storage from NRC student information area.

Enlightenment and Renaissance: Which Should Come First for Nuclear

Several months ago I blogged about an engineering presentation at Dartmouth. Dr. Swartz presented a talk with the provocative title: If Vermont Yankee Had an Accident Like Fukushima.

Swartz concluded that the "worried well" would be the major problem after any type of nuclear accident. Civilians would not receive radiation at a dose that would measurably increase their chances of getting cancer or limit their life-expectancy. They would also not believe any official assurances that this was the case. Dr. Swartz said it is up to the scientific community to explain the facts to people, and to reduce the health effects of widespread fear and anxiety.

In other words, we need education about radiation. We need widespread enlightenment about its effects.

Llewellyn King and Nuclear

Nuclear Townhall is sponsoring a set of videos about nuclear energy. In the short video below, Llewellyn King explains why the Enlightenment (education) has to come before the Renaissance (new plants) in this country. In history, the Renaissance came far earlier than the Enlightenment. So the nuclear industry has its work cut out for it!

Llewellyn King is an iconic figure in energy information, having founded Energy Daily about forty years ago. I remember Energy Daily from my days at EPRI. Copies were passed around among relatively low-level technical employees like myself and other project managers. Division heads received their own copies. Everyone read it every day, because it was the best source of insights for the energy industry. I do mean that everyone at EPRI read it. If a nuclear research manager had lunch in the cafeteria with a coal research manager, they would have a common point of conversation: the articles in Energy Daily.

King recently wrote a splendid op-ed about nuclear power: Sound the Trumpets for Nuclear Power. It's not particularly politically correct for this state. For example, his editorial praises the role of the U S Nuclear Navy in keeping the peace. Still, every now and again, I like to share the words of someone who speaks the truth, even if it is impolitic.

It makes a refreshing change from watching the Vermont legislature in action.

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Update: I am pleased that this post is now featured on the Energy Collective.

The Sixth Lawsuit about Vermont Yankee: Suing for the Cost of Replacement Power

I never should have done it. Four days ago, I published a post Five Legal Wrangles About Vermont Yankee.

I counted five, but lo and behold! Today there's a sixth lawsuit! You just can't keep up a count around here.

The Cooling Tower Problems

In August 2007 and July 2008, Vermont Yankee had widely-publicized collapses of a part of the cooling tower bank. The first incident happened because it happened. Vermont Yankee has rather old wooden cooling towers, and there was a maintenance problem on one of them. The second incident happened because of an incomplete repair of the first incident. In both cases, the plant stayed on-line, but de-rated power. It lowered power output for 11 days (first incident) and 12 days (second incident).

On the basis of these incidents, Central Vermont Public Service (CVPS) and Green Mountain Power (GMP) are suing Entergy. They had to buy more expensive replacement power during the time of lowered output from Vermont Yankee. They say that the plant was negligent about maintaining the cooling towers, so they deserve the money in recompense. You can read their press release here and it has been widely reprinted as a news article. Albany station WAMC had a short program on the lawsuit, hosted by Pat Bradley. Don Kreis of Vermont Law School gives his opinion, and I give mine. (The program is three minutes long.)

If Everything Isn't Perfect, We're Suing

Briefly speaking, this is a ridiculous lawsuit. There are all sorts of utility contracts out there, and CVPS and GMP did not have a contract in which Entergy had to pay them for replacement power. That is the end of the story. GMP and CVPS didn't have a contract that required reimbursement.

The utilities are claiming that Entergy's plant maintenance was so bad that the de-rating was due to Entergy negligence. I have one word for that: Ridiculous! Vermont Yankee has a high capacity factor, and has had a series of breaker-to-breaker runs (from one refueling to another without a stop). In this case, it wasn't even off-line for the repairs. It had just powered down.

If utilities sued every time a plant powered down or went off-line unexpectedly, there would be no end to it! Of course, if a plant is not operating at full capacity, something went wrong. I suppose this could have been prevented if everything had been done perfectly. Let's look at coal plants, for example. They have to keep testing the coal they receive. Let's say they receive some coal and they don't get the chemistry analysis quite right and boom...their boiler is coated with slag and they are off-line. (Most coal plants test coal extensively and blend coal to avoid this situation. They don't always manage to avoid it.) Should a coal plant be sued on the basis that they should have done a better chemical analysis?

Utility Contracts

There are all sorts of utility contracts out there. Bob Hargraves and I visited seven plants when we led the ILEAD course on Energy Safari. If you read the posts on the Energy Safari blog, you will read about power plants that:

• sell power at the market price when the price is high enough
• sell power at a fixed price, and have to reimburse the utility when they have promised power but can't deliver
• sell power at a fixed price, and don't have to reimburse anybody if their power isn't available
• don't want to tell us the terms of their contracts

If a utility wants to buy power that is available without interruption at a given price, it writes a contract saying that the power plant must reimburse the utility for any power that is not provided. Of course, the utility can expect to pay more for power on that basis, just as you can expect to pay for an "extended service contract" on an appliance. Insurance against failure costs money.

Insurance

The utility can also pay money for insurance. If the utility buys insurance against having to buy higher-cost power, it doesn't have to put any terms in the contract with the power plant.

For example, I attended a hearing at the State House when GMP and CVPS testified that they actually have insurance policies which would reimburse them for replacement power costs if Vermont Yankee power was not available to them. The policies began to pay if Vermont Yankee was off-line for more than about 30 days. I am sure the utilities could have bought other insurance: insurance against three-day outages, twelve day power reductions, anything. Insurance companies love to sell insurance! However, insurance against small events would have been expensive, since such events are very likely. Most companies self-insure for small problems.

Money or Harassment?

I can never know anyone's motives, of course. However, to me this lawsuit sounds more harassment than like a business situation. Surely the utilities know what kind of contract they have with Vermont Yankee? Surely they know that they don't have the sort of contract that includes reimbursement for replacement power? Surely they know about the various types of contracts? Surely they know that accusing a plant of negligent maintenance won't fly, when the plant is running from fuel loading to fuel loading (breaker to breaker), 500 days or more, without unplanned shut-downs? Surely they know they could have purchased insurance against the costs of replacement power? Surely they know they actually have purchased insurance against the costs of replacement power due to long outages?

GMP and CVPS are acting as if they don't know any of this.

Interestingly, the utilities want to have a jury trial on this subject. I think they are hoping to capitalize on the "Entergy Louisiana" and "strontium fish" rhetoric of the Vermont administration. They hope to win their case by pounding on the table.

Washing Machines

The Entergy lawyers can argue their case without any table-pounding.

"Ladies and gentlemen of the jury. CVPS and GMP had opportunities to insure themselves against paying the cost of replacement power. They could have stipulated that we pay the cost of replacement power as a requirement in their contract with Entergy. Or they could have bought third-party insurance for their costs during power derates or outages. CVPS and GMP did not taken any such action.

"Instead, these utilities are in the position of someone who does not buy the extended warranty on the new washing machine, but expects to get free service anyway. We at Entergy are pleased that they expected perfect operation of the plant. We are pleased our general excellent maintenance and breaker-to-breaker runs may have led them to expect perfect operation. However, they took no steps to protect themselves if operation was imperfect. Though we are flattered at their expectations, we must point out that expectations of perfect operation are unrealistic, and are certainly not enforceable through the courts."

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Picture of the Comerford Hydro plant from Energy Safari blog. Picture taken by Bob Hargraves. All other graphics from Wikipedia..

86th Blog Carnival at NEI Nuclear Notes

The 86th Carnival of Nuclear Energy is up at NEI Nuclear Notes.

Many of the bloggers at the Carnival have delved into books, legislation, long reports, and law cases. They have written excellent summaries, complete with information and opinions. Reading their posts, you can become knowledgeable without reading all that material yourself. On the other hand, if you have already read the original documents, you can comment on the blog posts. So you can still have fun!

Some of the reports include:

• Dan Yurman at Idaho Samizdat reviews a book on the Integral Fast Reactor. This program included the whole fuel cycle for the reactors, including waste management.
• At ANS Nuclear Cafe, Yurman delved into the recently-passed Energy and Water Appropriations bill of 2012. Nuclear energy research was largely spared from major cuts.
• At Yes Vermont Yankee, I described five, count'em, five current or recently-resolved lawsuits about Vermont Yankee.
• At Nuclear Diner, Cheryl Rofer summarized Japan's interim report on the Fukushima accident. There is more known about the communication failures than about the physical failure sequence.
• At Atomic Power Review, Will Davis describes an upcoming symposium about reporting on Fukushima. The reporting was pretty terrible, and there's hope it will be recognized at this symposium.
• At Atomic Insights, Rod Adams looks into energy density and fuel availability. If we want a future of more than 100 years of abundant energy, the answer is New and Clear. (My pun, not Rod's.)
• At NEI Nuclear Notes, Mark Flanagan reviews how France and the U.S. are upgrading reactors in response to Fukushima.
• Brian Wang describes Toshiba's new system for cleaning soil of radioactive cesium.

Read the short, well written version of all this interesting material. Read the bloggers! Come to the Carnival!

Update Note: I also recommend Howard Shaffer's post today at ANS Nuclear Cafe: Vermont Outreach Continues as Opponents Reorganize

Podcast Discussion of Vermont Yankee (and more)

Vermont Yankee Discussion

Last night, Margaret Harding and I were guests on the Atomic Show podcast, hosted by Rod Adams. Adams is the blogger at Atomic Insights, while Harding blogs at 4 Factor Consulting.

The main subject of discussion on our podcast was the Vermont Yankee lawsuit, especially the interstate commerce aspects of the case. As Rod wrote in his description of our conversation:

It still confuses me why people who live in Vermont have such a basic misunderstanding of the country in which they live; no state has the right to control interstate commerce. All of them gave that up when they signed on as members of the United States of America.

Sigh. Rod doesn't live in Vermont. As I wrote in a recent post, Vermont also passed a blatantly illegal law requiring Vermont Yankee to pay Vermont's costs in the ongoing lawsuit. Governor Shumlin and his obedient legislature seemed determined to pass law after law that get argued right up to the Supreme Court. Where Vermont loses.

Here's a link to the podcast of Atomic Show #177, Vermont Nuclear Energy Politics.

Nuclear Communications, Then and Now

Vermont Yankee was not the only topic of discussion on the podcast. We take a detour into nuclear communications, and especially, how nuclear communications were messed up in the early days. At first, some of the "silent service" aspects of the nuclear navy dominated the nuclear power communications style. Adams was in the nuclear navy, so we weren't talking behind the backs of the many fine Navy Nukes that run our power plants! But the Navy communications style was a problem in the 70s and early 80s, and it is good to admit that.

I also recommend Rod's post Greetings from a proud member of the 'nuclear party'. This post was also briefly discussed on the podcast, and is up this morning at ANS Nuclear Cafe.