Update: Not WARNing at V.C. Summer

June 9, 2017 photo of Summer construction
SCEG photo

Update:

SCEG withdrew its original petition to abandon the Summer Project, but this was only to facilitate government review of the petition.  After withdrawing the petition,  SCANA held a press conference and re-iterated its plans to abandonn the nuclear project.

Meanwhile, knowledgeable people have emailed me that the construction workers at Summer are probably not covered by WARN, but employees of Westinghouse and Fluor probably are covered.  I am not a lawyer, and I am merely repeating what they said.  It is probably true, however.

None of this is good news for the project or the workers.


The Stop-Work at Summer

At the V.C. Summer construction site in South Carolina, a stop-work order was issued by the plant owners. Within hours, thousands of people had to turn in their badges and leave. There is simply no way to sugar-coat this story.

Actually, there are at least two stories here: the first story is about why V.C. Summer was cancelled. That story has been widely discussed.  The second story is about how the  layoffs happened, and their legality (or not).  This story has not been covered very much. It will be covered here.

At the end of this post, I have an annotated list of resources  about the first topic, why Summer was cancelled.

The Human Cost

On Facebook, one friend wrote about how difficult the Summer closure was for his family.  I will not quote his statements here, but his post made me feel very sad for all the hard-working people at Summer.  I mean I was feeling bad already, but his post made me feel worse. The cancellation of Summer had a huge human cost. You can't lay off 5600 people without immense pain, and immense ripples in the community.

It is too mild to say that the layoffs themselves were not handled well.  In my opinion, the way the layoffs were handled was certainly immoral, and may have been illegal.  In this article, Fired nuclear construction workers crash State House, workers said they had "no warning from superiors before being let go about lunchtime Monday." In a video at WLTX, workers said "We met at our lunch location and they read these letters to us...."

It's impossible to get numbers, but most sources say 5000 people were affected by the equivalent of letters-read-at-the-lunch break.  In the video above, a worker says that he has never heard of so many people being laid off at one time.

My first reaction was that I thought that such a layoff was simply illegal.  A federal law, the WARN act, requires employers to give advance notice of large layoffs. Nolo.com has good article on the WARN act and South Carolina. (Nolo sells consumer-oriented legal books and software.)

WARN and the big boys

WARN covers employers who have at least 100 full-time-equivalent employees.  If 50 or more employees are laid off at one job site, WARN requires sixty days notice. (You can read the fine print at Nolo.com)

On Facebook, I said that I thought the short warning of this layoff was probably illegal. One person commented that I was making unwarranted assumptions.  In his opinion, a big employer would read the laws and obey them. Okay.  Basically, he was right about the biggest of the big boys on the job site: SCEG. According to this video and article from WISTV, SCEG notified the state of 615 layoffs at Summer (layoffs of their own employees), giving the requisite 60 days notice according to the WARN requirements.

However, they gave Westinghouse no such 60 days notice, because Westinghouse is a contractor, not an employee. Westinghouse immediately "furloughed" 870 employees, according to the Pittsburgh Post-Gazette.  However, these employees have no reason to believe that they will be called back from  this "furlough."  According to Post-Gazette article, a field engineering manager at Westinghouse has sued Westinghouse for violating WARN. He is attempting to achieve class-action status with his lawsuit.

SCEG covered its own employees, but employees of large and small subcontractors seem to be subject to the largest sudden layoff that I have ever heard about.

WARN and the not-so-big-boys

Westinghouse, with hundreds of employees on this project, is one of the big boys. Nevertheless, it seems to have issued as quick a lay-off notice as might have been issued by any local supplier of portapotties. Westinghouse is now being sued.  I suspect that many of the other contractors may also be sued.

Chess Pawn, Wikipedia

Opening Gambit or Closing the Door?

Why did the layoff happen in this sudden way?  It saved some money for SCEG, until they get sued, of course. It devastated towns and businesses and gave locals a pretty grim idea of what their utilities think about their welfare. Looking at a project that is over budget by billions of dollars, I don't think saving two months worth of salaries was the entire motivation. Decades of bad feelings are likely to arise from the sudden layoffs, and two months payroll was saved? To me, it doesn't make sense.

That is just my opinion, of course, but there it is.  Sometimes, dramatic events are the opening moves in fierce negotiations.  "Now that I have  your attention...."

Sometimes, of course, dramatic statements are the closing moves: "Look, I mean it, and nothing you can do will change my mind." However, that sort of statement often comes after a long fruitless negotiation.  Not always, but usually.

Games people play

If this were a chess game, I would say: This is more likely to be an opening gambit than a closing statement.

But wait, V.C. Summer is not a chess game!  In a chess game, the pawns are little pieces of plastic or wood or ivory.

At V.C. Summer, the pawns are more than 5000 real live people.

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Addendum:  Why V.C. Summer was cancelled.

I recommend three excellent blog posts on the reasons for the project cancellation.

In 2016, Will Davis wrote at ANS Nuclear Cafe: Nuclear Plant Costs-- A Look Back and Ahead 
This post describes the cascading effects of various types of cost overruns, including changes to the specifications, delays, and incomplete planning.

On July 31, 2017, Dan Yurman at Neutron Bytes wrote Utilities Pull the Plug on AP1000s at V.C. Summer.  He looks at the cost overruns, but also notes that Santee Cooper refused to go along with a plan to complete just one of the reactors.

On August 1, 2017, Rod Adams wrote: Tragic day in South Carolina as 5,000 people lost their jobs at VC Summer. Rod's post concentrates on design changes, specifically the Aircraft Impact Assessment Change.  There are 120 comments on that post.  Many of these comments are from very knowledgeable people.

Preemption: Why The State Won't Appeal the Vermont Yankee Ruling

The Crystal Ball

Appeals Court Confirms that States Cannot Regulate Nuclear Safety

Recently, the Appeals Court ruled that the state of Vermont was trying to regulate nuclear safety. By federal law, nuclear safety is regulated at the federal level: therefore, regulating it at any other level is preempted by the  Constitution.  The Constitution says that when there is a conflict, Federal laws overrule state laws (Supremacy clause).

In this blog post, I give some of my reasons for believing that the state of Vermont will not appeal the Appellate Court ruling. I think Vermont will not appeal, and the case will not go to the Supreme Court.

Okay. Deep breath here. Every now and again, I look into my crystal ball while sticking my neck out.  It's a complicated maneuver, but hey--I blog. I make predictions.

Unlike the well-dressed lady in the painting, I usually need to give some reasons for my predictions.  If I gave all my reasons, this would be a terribly long blog post.  This post is only about my preemption reasons.  But first, an overview.

Five reasons the state won't appeal 

I am not a lawyer.  The appeals court ruling is written quite clearly, and I have reviewed it carefully. Within the ruling, I can reference five different parts of the ruling that convince me that the state will not appeal it. My reasons fall into two groups:

• Preemption: the first group  (three parts of the ruling) is about preemption,
• Money: the second group  (two parts of the ruling) is about money.  These reasons are NOT covered in this blog post, though I touch on one of them at the end.  I will write another blog post about this subject.

In this post, I am blogging about the preemption sections of the ruling. Here's a link to the ruling itself, for reference.

Preemption As Described in the Appeal Ruling


1) Vermont was Legislating on Nuclear Safety

It is a federal mandate to regulate nuclear safety through the NRC.  Both the district and the appeals court ruled that the Vermont legislature was trying to rule on nuclear safety, and preempting this federal mandate.

The appeals court more than upheld the district court ruling, it augmented it with more examples. For example, on page 10 of the appeals court ruling, it quotes a Vermont law in which the Vermont legislature required a certain arrangement of fuel bundles in the fuel pool.

On page 35 of the ruling, the court states explicitly that it agrees with the "district courts' careful analysis of the legislative intent."  On that same page, it notes the "remarkable consistency with which both state legislators and regulators expressed concern about radiological safety and expressed a desire to evade federal preemption."

The original ruling did not include the fuel-pool-arrangement quote,  or several other safety-related quotes that are included in the appeals court ruling.  Since the appeals court ruling confirms and extends the circuit court reasoning on legislating nuclear safety, this ruling means it would not be reasonable for the state to appeal on those grounds.  There's no judicial controversy here, so no rationale for an appeal.

2) The Footnote: Federal Rights Stay with the Federal Government

The right to rule on nuclear safety belongs to the federal government: nuclear safety is preempted to be a federal responsibility.  Neither Vermont nor Entergy can waive their rights about this preemption, because the power of the preemption does not rest with them.  Agreements in which Vermont and Entergy agree that Entergy shall "waive its rights" of federal preemption are meaningless:  the federal government has certain regulatory rights, no matter what agreements Entergy or Vermont sign.

In the Appellate ruling, the judges describe how the Vermont legislature attempted to put radiological safety issues into Memorandums of Understanding (MOUs) with Entergy instead of into the laws passed by the legislature. In these MOUs, Entergy supposedly "waived its rights" to preemption challenges.  This MOU strategy was Vermont's deliberate legal maneuver to avoid preemption challenges in the future.  On page 41 and 42 of the Appeals Court ruling includes several quotes from legislators explaining their "put it in the MOU" strategy.

And then, there's that footnote.

While not explicitly ruling on this "they waved preemption" strategy, the court wrote the following footnote (page 42 of the ruling):

33 We cite this provision of the 2005 MOU not for the purpose of ruling on whether a party may validly waive the right to bring a preemption challenge, but only to demonstrate the impermissible intent on the part of the Vermont Legislature. But see Olympic Pipe Line Co. v. City of Seattle, 437 F.3d 872, 883 (9th Cir. 2006) (“Preemption is a power of the federal government, not an individual right of a third party that the party can ‘waive.’ [The plaintiff] could not, therefore, waive a right that it did not possess.”

Blogger note...footnotes are important. Several of the early Vermont Law School blogs on the case were ALL about the footnotes!  In this situation,  I translate the footnote above as:

"Yeah, we could rule based on this one, too,  if we had time. ("But see" this other case....) We could rule on the fact that only the federal government can "waive" preemption, because only the federal government HAS it.  But this court has plenty of other evidence of the illegal intents of the Vermont legislature, so we don't really need to go there in order to make a solid ruling.  But still, there it is...preemption is a power of the federal government, not the right of a third party.  Just sayin'. "

In this case, the appeals court is mentioning an area which the circuit court didn't even cover--that is--the inability of a third party (Entergy, the state) to "waive" the federal prerogative of preemption. In my view, when appeals court brought up this issue, they made it harder for the state to appeal the ruling.  The footnote says: "Vermont, your actions have loaded another legal gun and aimed it at yourself.  We aren't bothering to fire it yet, but we just want you to know it is there..."

3) A separate ruling confirms the fact that states cannot rule on nuclear safety. 

The appeal was heard by three judges: Susan L. Carney, Christopher F. Droney, and Paul G. Gardephe.  Judge Carney agreed with the ruling, but she wrote a separate opinion because she agreed with it on different grounds. Carney's nine-page ruling starts after page 53 (the end of the combined ruling) in the decision.

Basically, she concurs that the Atomic Energy Act was meant to prevent state legislatures from regulating nuclear safety.  She quotes the majority ruling that "the State legislative record before us is 'replete with references to radiological safety.' " She further notes that "no reader of this record can fairly claim that the statutes at issue were not "grounded in safety concerns."

But then she begs to differ.  She basically claims that the Supreme Court case (Pacific Gas, 1984) which is referenced throughout the rulings goes too far in its requirements that states avoid regulating nuclear safety.  As I read her ruling, she would prefer if states could consider nuclear safety along with other concerns in their deliberations about a power plant.

However, in the last two sentences, she acknowledges that "there is no avoiding the Supreme Court’s teachings in Pacific Gas. The statutes before us are preempted, and I therefore must concur. "

In my opinion, this separate concurrence means that this ruling is completely correct in terms of existing precedent.  In other words, the state should only appeal this ruling IF the state thinks the Supreme Court will overturn the Pacific Gas decision.

That's a pretty high bar.

Okay. While I think "Pacific Gas has to be overturned for Vermont to win" is a reason that Vermont won't appeal, I admit that it is the weakest of my set of preemption reasons.  Vermont is a state of about 600,000 people.  In other words, it doesn't really have a tax base to support mounting precedent-setting challenges at the Supreme Court level.   But it could decide to do this anyway.  As I said, it is the weakest of my reasons that the state won't appeal.

The Three Reasons Vermont Won't Appeal on Preemption Grounds  

1) Three opinions (District opinion and two opinions at the Appellate level) concur that the legislative record shows that Vermont was trying to legislate nuclear safety.  All three opinions agree that safety regulation is reserved to the federal government.

2) There's a whole separate legal argument that could be mustered about the Vermont legislature trying to hide the preempted concerns in "waivers" in Memorandums of Understanding.  The Supremacy Clause of the Constitution cannot be abrogated by third party "waivers." This legal comment was made by the judges in a mere footnote to the case.  In my opinion, that footnote was a warning to the state that they were on shaky ground in this case, eight ways from Sunday.

3) Even a judge who would have liked to rule for the state (as I read it) admitted that existing Supreme Court precedents meant she must rule against them. (Carney's separate opinion.)  If Vermont takes the case to the Supreme Court, it would not be arguing about the legislative intent any more (that is settled, see above) but about changing a major precedent. That's a harder argument to make.

Another Reason Vermont Won't Appeal

Follow the money.

This appellate ruling reversed a different section of the district court ruling--the section that was the basis for Vermont having to pay Entergy's legal fees.  The Vermont Attorney General is quite reasonably counting this as a win: By appealing Murtha's decision, I saved the state around five million dollars!

The preemption question is solid in all the courts, but the legal-fees part has gone back and forth. In other words, since the courts have already disagreed on the issue about legal fees, in a further appeal, the state risks the court reversing itself on this and making the state pay Entergy's legal fees.

I think the state will take the money, declare victory, and go home.

However, the financial implications of the ruling have to be a blog post for another day.

Update Grab Bag: Tiny Tritium, Big Lawsuits, and Small Spats.

So Much Action

I haven't blogged since Sunday. I'm trying to catch up. My three topics are tritium (surprise!), the Entergy Earnings Conference call, and a little on-line spat.

Tritium Again

What: Vermont Yankee may have shot itself in the foot in terms of public relations by not submitting some water samples.

Exactly What? Apparently, Vermont Yankee did not notify the state about tritium found in a new well....as quickly as the state expected notification. Entergy said that their sampling apparatus was down for repair.

Consequences: The Public Service Board (PSB) is mad, and has required VY managers to submit samples under oath. (No, not drug test samples. Tritium test samples.)

And It Means: Very little. The amount of tritium in the samples is tiny, less that 1000 picocuries per liter. In the newspaper stories I read, it was not clear that VY was required to submit the test samples on a certain schedule or it had chosen to do so. Whichever it was, VY shot themselves in the foot in terms of public relations by not submitting a water sample on time. Unless, of course, they weren't required to submit the sample in that time-frame. So the PSB is angry and fed up and won't take it any more. Or the PSB wants Entergy to think they are angry and fed up and won't take it any more. To me, this whole thing is like a set of chess moves. It's not about the tritium.

The Earnings Call

What: Entergy, like all large publicly held company, has quarterly earnings calls. In the most recent one, Wayne Leonard, President of Entergy, made some strong statements.

Exactly What Did He Say? States or governors are certainly free to voice their opinions, but the NRC, which has jurisdiction on these matters, must deal with the facts....Efforts also continue to secure a new power purchase agreement with the Vermont Utilities. Negotiations had been ongoing for some time now..... However, while we would certainly prefer to sell power in state, that is not a necessary condition, of course.

The Consequences: In only slightly-veiled terms, Leonard raised the possibility that Entergy might file a lawsuit on the grounds that the Vermont Legislature has pre-empted federal rules. (Recently, I listed three possible grounds for lawsuits.) The words were also a clear statement that Entergy considers that it holds some cards in the negotiations with the Vermont utilities. No law requires Entergy to sell power only to Vermont. As I pointed out in a previous post, a state always gets the best deal from its in-state power suppliers. That is, the state gest the best deal if the state and the supplier aren't suing each other. If they are suing each other, the court decides the deal.

And It Means: A lawsuit would be a game-changer about negotiations. Even the threat of a lawsuit is a game-changer. Shumlin responded by calling Entergy a liar, though he restrained himself from the L-word. He said it was A company that has a history of saying one thing and doing another. The Shumlin honeymoon is over, as far as I am concerned.

A Minor On-Line Spat

What: Howard Shaffer wrote a post about our Vermont activities for ANS Nuclear Café.

Exactly What Happened: Bob Stannard, an anti-nuclear lobbyist in Montpelier, wrote a negative comment on the post. I commented on his comment, and we had an on-line discussion. Or spat. Or something.

Consequences: Stannard decided to set me straight about Vermont Yankee's importance to Vermont. It's not that important, in Stannard's opinion. As he said: Approx. 1/3 of Vermont does not use or depend on VY power

And It Means: Two-thirds of Vermont uses or depends on VY power. I didn't say it: the anti-Vermont Yankee lobbyist said it. Sometimes the opponents tell it like it is.

Boxing Glove Image from Wikipedia.

The same image might have been used to illustrate the Earnings Call section.

An Amazing Conversation

My post on the Piping Diagrams elicited two very interesting replies, one from Commissioner O'Brien, and one from Don Kreis of Vermont Law School.

I am cutting and pasting their comments below.

However, something even more amazing has happened. In a world (Vermont) where people shout and throw manure, Professor Kreis and I are having a very civilized conversation about Vermont Yankee. We are discussing who said what to whom. We are having this discussion in a very positive manner. This is a conversation I want to publish on my blog! Alas, it is getting awfully long...so I will link to it, instead.

Read and join the conversation at Vermont Digger or add a comment on this blog. Thank you to Don Kreis and the people at Vermont Digger for this opportunity.

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IMPORTANT UPDATE: The link to the conversation at Vermont Digger no longer works, and the conversation has been removed from the site. An earlier post by Donald Kreis remains on the site.

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The comments from my earlier post, below.

Don Kreis said...

Meredith:

Thanks for the invitation to leap into the dialogue. If I am understanding our respective comments correctly, we are a couple of Tufte fans who aren't in fundamental disagreement here. Diagrams and technical reports would have been a good focus at the September 11, 2008 meeting, which instead was organized around a .ppt presentation that was unhelpful for precisely the same reason that the Boeing .ppt show was unhelpful during that final flight of the Shuttle Columbia.

Obviously, the 9/11/08 PowerPoint didn't have the devastating consequences the Boeing/NASA one did. I never suggested otherwise. Your real beef, I think, is with Tufte -- he could have chosen other, less high-stakes examples of bad PowerPoint slides. The world is awash in them.

MAY 9, 2010 8:08 PM

David O'Brien, Commissioner said...

Meredith, with all due respect I have to disagree with your characterization of the Department having egg on our face with respect to the now famous underground pipes. When others are looking at this issue they are missing a critical piece that is not in the VY investigation or recorded even in our emails. It is the repeated claims by VY persons at the many meetings we had together with the consulatants and the oversight panel where VY was questioned on their claim that they did not have any underground buried pipes. It was this repeated asseration by VY that we trusted that they were giving us an accurate answer.

There are so many people saying why not just look at the drawings. Well, first, they probably have no idea how many drawings there are for this plant and the drawings alone do not identify pipes carrying radionuclides. After discovering that the company's own affidavit by a Mr. Rademacher could not be relied upon, Bruce Hinckley, our consultant that assisted us with the NSA audit, had to have contractors go over the drawings and other information to identify the pipes that do carry radionulclides and it took about 5 weeks and cost about a 150K. People forget that the legislation had us on a very tight schedule where we had less than 4 months to complete a massive inspection. We had to get the scope of the inspection agreed upon with the POP so we could get started before the clock ran out. We did not have reason to believe that VY was not providing accurate information with regard to the pipes and therefore had no reason to second guess them by spending more time and money to verify their statement upfront.

In summary:

1. First, the question isn’t just about whether there were underground pipes at VY. Of course, there are underground pipes at VY. We all knew there were underground pipes at VY, but what we were told is that there were no underground piping systems carrying radionuclides. So we could have been aware of numerous drawings showing underground pipes and that would not have alarmed us or clued us in that there are underground pipes carrying radionuclides.

2. Second, as a long time regulator, we have to trust a utility to provide us with accurate information. Our entire system of regulation is based upon that basic premise. If that was not true, the DPS and every other PUC in the country would have to be at least twice as large. Once a utility shows it cannot be trusted to give accurate information, then we have to go over everything with a fine toothed comb. We said we would verify the piping affidavits that Entergy gave us because we no longer trusted them to give us correct information. Hence the extra 5 weeks and 150K worth of verification.

MAY 10, 2010 8:35 AM

Meredith Angwin said...

First, I would like to thank Donald Kreis and Commissioner O'Brien for their thoughtful responses to my blog.

Donald, just a note that it is not possible for me be annoyed at Tufte. I have admired him since I first saw his first book, The Visual Display of Quantitative Information. And he can use whatever examples he chooses.

My issue was different. The Report of the Investigation clearly states that Entergy gave P and ID diagrams and tables of piping to the NSA team in meetings on September 9 and 11, 2008. As I understand it, the NSA team received this piping information in both hard copy and electronic form. (This is not in the report, it is something I heard through the grapevine. Maybe NSA actually only received paper copies, I don't know for sure.)

You concentrate on the Powerpoint presentation, and ignore the backup data which Entergy gave to the NSA participants. In my post, I cited the pages for my sources of data exchange. Perhaps you can read pages 19 through 23 of the text (25 through 30 of the pdf) and tell me why you think the Powerpoint was the only significant information-exchange method?

Commissioner O'Brien, I want to thank you for your response, which was full of new information (or at least, new to me). I didn't understand the legislative requirement to complete the massive inspection in four months. I had no idea of the constraints under which the Department was operating. From an outsiders point of view, the whole thing has basically gone on forever, with dockets, VSNAP meetings, NSA panels, POP panels, etc. When you are working inside the project, though, life looks different. The Department was clearly put in a position of Never Time to Do It Right, Always Time to Do It Over. Six weeks and 150K to do it over! Thank you for explaining the situation.

Thank you both for your comments.