Wednesday, February 1, 2012

Back to the Public Service Board: Next Steps for Vermont Yankee

The court ruled in favor of Entergy in the recent court case. In consequence, Entergy applied to the Public Service Board for a Certificate of Public Good for Vermont Yankee.

Judge Murtha's ruling in the case is over 100 pages long. At one level, however, it can be summarized as follows:

The State of Vermont tried to alter a contract unilaterally. That is not allowed. The contract still stands. Just as it says in the contract, the Public Service Board will decide on the Certificate of Public good. The Public Service Board cannot consider radiological safety in granting this certificate, because that is the responsibility of the NRC, not the states. Also, the Board can't insist on below-market electric rates for in-state utilities, because that is against the Interstate Commerce Clause of the Constitution.

The Memorandum of Understanding

The contract that determines how Vermont Yankee applies for the Certificate is the Memorandum of Understanding. This is the contract between Entergy, the state and utilities, signed in 2002 when Entergy bought Vermont Yankee. It requires Entergy to obtain a Certificate of Public Good from the Public Service Board (PSB).

However, the fact that Energy actually applied for this certificate will be will be much discussed. During the trial, Entergy claimed that the PSB's neutrality had been seriously affected by the legislature's actions from 2006 to 2011. When the ruling was issued, it was not clear whether Entergy would appeal: the ruling put Entergy in the position of needing a PSB certificate in order to keep the plant operating. So far, Entergy has not appealed the ruling. It now seems that they have put the plant's fate into the hands of the PSB.

Both Entergy and the State have until mid-February to appeal, so it is not clear what happens next. Entergy could conceivably appeal while also applying to the PSB. The State could appeal and also request that the PSB not act until the court case is resolved.

It is all up in the air. As usual.

A Brief Guide to What They Are Saying

For a fuller review of the matter, I recommend these two articles. They are very different, and it is enlightening to read them and compare them.

Dave Gram of Associated Press reports that Entergy asked the PSB for a ruling. However, much of the article consists of a lengthy interview with one of AP's favorite nuclear opponents, Ray Shadis. Shadis worries that the PSB hasn't reviewed nuclear safety factors since Fukushima. Apparently, Shadis ignored the part of the judge's ruling which said that the PSB cannot consider radiological safety considerations. Shadis' comments make up most of the article.

Terri Hallenbeck of Burlington Free Press (BFP) provides a more complete report. She quotes plant opponents. However, she also quotes the Entergy CEO as he wonders whether the state will appeal. In this article, I learned that Entergy has until the end of this week to request legal fee reimbursement from the state. I also learned that PSB guidelines for a certificate do not require that a power plant provide service to Vermont. A very interesting article.

In my opinion, these two articles are an amazing compare-and-contrast, between mediocre reporting (AP) and excellent reporting (BFP). The AP article depends on the usual statements of the usual opponents. The BFP article obtains both sides of the story and includes a timeline about reimbursement.

A Final Note as We Await the State's Decision on Whether to Appeal the Ruling

Will the state appeal? Cheryl Hanna of Vermont Law School describes the bigger picture of federal prerogatives and attempted state pre-emptions. Her short, well-written interview is mostly about food safety, but definitely worth reading. Once there are federal laws regulating a subject, the role of the state is circumscribed. In other words, it is very unlikely that Vermont Attorney General Sorrell could win this case by appealing.


Meredith Angwin said...
This comment has been removed by the author.
Unknown said...

Hello Meredith!

Howard Shaffer said...

Great post. Including Prof. Hanna really adds to it.

After hurricane Irene, Vermont was pretty quick to turn to the Federal government.

Anonymous said...

If the PSB decides the issue on its merits, it should be a slam-dunk with for VY, as has been documented here. But, I have a feeling they won't decide the case on its merits, but on politics. I guess Entergy could then sue in court, but that is often a roll of the dice. Can Entergy force disclosure of how the PSB decided the case if they end up on the short end of the stick?

Mike Mulligan said...

The PSB is mostly all Douglas republicans....I'd be asking if Gov Shumlin has the legs to get past the next election and still be governor.

What is his popularity?

Anonymous said...

Tried to post this the other day; hopefully it makes it in this time. . .

My main concern is that the "deadline" is what, March? It's now February? Because of interference by the state Legislature, this Cert. of Public Good application has been delayed by like 2 years. Will Entergy get a reasonable extension of time to be able to make the application?

It's like I enter into a contract with you which stipulates I lose my car if I don't do something for you by a certain time, then after I sign the contract, you tie me up and lock me in a closet until 1 hour before the deadline.

Meredith Angwin said...

Anon and Mike. How the Public Service Board is likely to act is a hard question. I hope to do a blog post on this, when I feel more confident of what I would say!

Jeff. I have thought about your comment and I have wondered about the same thing. As I understand it, the PSB can take its time with any ruling, and whatever was in place before it rules just stays in place. So the current CPG would be in effect until they rule, even if it had technically expired. You could see how this would be useful for a board that has to rule on electricity, telecomm, etc. This allows them to set priorities in their deliberations, and "bump" a telecomm rate increase hearing if an important electricity contract comes up in the meantime.

However, I am NOT sure about this, and have to check it. This is the impression I get, however. If they don't get around to ruling by March 21, the current CPG is in place until they rule. I think.

Mike Mulligan said...

I almost feel like telling Gov Shumlin, forget about it. We will pick it up on the other side of the election when the House, Senate and president is democrat controlled.

You got wonder if that is the big message of Judge matters who you put in office in Washington...

Meredith Angwin said...

Jeff. Sarah Hofmann of DPS, always helpful, found the following in the Murtha ruling. I couldn't find it. She was very nice about it, because I was embarrassed by not finding the relevant passage. She said it had taken her some time to find it! Here it is.

“Furthermore, Vermont law provides that a license subject to an agency’s notice and hearing requirements does not expire until a final
determination on an application for renewal has been made. Id. tit. 3, § 814. Entergy filed its petition for a CPG pursuant to the sale, citing title 30, sections 102 and 231 of the Vermont
Statutes as authority for the CPG.”

So. In other words, the current CPG doesn't expire until the PSB issues a ruling.

Anonymous said...

Ok, that's good to know. It wasn't clear to me before how that would work out. That seems like a shockingly reasonable law.