Entergy, Vt. square off over nuke plant's future

AP News
Posted: Sep 12, 2011 7:27 PM
Entergy, Vt. square off over nuke plant's future

A newly released internal email from Entergy Corp. shows the company desperately trying to shore up flagging public support in Vermont in the weeks before and after a state Senate vote last year to close the Vermont Yankee nuclear plant.

The memo, from Curtis Hebert, a former Entergy vice president and former chairman of the Federal Energy Regulatory Commission, was made public Monday in a federal court trial in which New Orleans-based Entergy is suing the state of Vermont for moving to shut the plant down when its initial 40-year license expires next March.

Hebert's May 6, 2010, email to Entergy CEO J. Wayne Leonard came after revelations that January that radioactive tritium had been leaking into soil and water around Vermont Yankee, and that plant officials had misled state regulators and lawmakers by saying the plant didn't have the kind of underground piping that carried tritium.

Hebert cited several reasons Vermont political leaders _ Democrat, Republican and Progressive _ were upset with Entergy in the winter of 2010. The state Senate defeated a bill that February to allow Entergy to seek regulatory approval to continue running the plant. The reasons for the state's angst included:

_ The January 2010 announcement that radioactive tritium was leaking from the Vernon reactor, and the revelation a week later that plant personnel had misled state lawmakers and regulators;

_ A plan by Entergy, since scuttled, to sell Vermont Yankee and four other nuclear plants to a newly created company that many state officials thought was not being set up with enough money to run a fleet of nuclear plants;

_ Resistance by the company to the demand from many lawmakers that Entergy put more money into the fund to pay for dismantling the plant when it stops operating;

_ The failure by Entergy and Vermont's power companies to agree on a deal under which the companies would buy power from Vermont Yankee if it ran past the end of its initial license's expiration date in March of 2012.

Hebert wrote of the company's misleading statements about underground piping. "The evidence was clear that the testimony (before the Vermont Public Service Board) had been incomplete, and this had a corrosive effect on our supporters throughout the state, particularly our strongest and most visible supporter: (then) Vermont Governor James Douglas, who stated he had lost confidence in Entergy and VY."

On the corporate spinoff plan he wrote: "The implosion of Wall Street and a number of high-profile corporate bankruptcies in 2008-2009 added to this general sense of mistrust and malaise."

The Hebert memo could help the state establish it had reasons for closing Vermont Yankee aside from concerns about nuclear safety. In its suit against Vermont, the company maintains nuclear safety is the state's main worry, and that federal law pre-empts the state from taking action on that topic, leaving it solely to the federal Nuclear Regulatory Commission.

The trial, being heard by Judge J. Garvan Murtha without a jury, is expected to last through Wednesday, followed by a chance for lawyers to file follow-up briefs. It's unknown when the judge might rule.

Earlier Monday, Entergy Vice President Marc Potkin testified that he felt heavy pressure from state officials to sell power at a price favorable to Vermont utilities if his company wanted the state to allow the plant to continue operating.

The plant's flagging political fortunes influenced the talks on the power-purchase agreement, Potkin said. He was eventually told the electric companies wouldn't sign a deal to buy power from the plant unless Entergy sold it. Entergy put it on the market last year, but got no takers.

In her opening statement, Entergy lawyer Kathleen Sullivan said Vermont was trying to close the plant because of concerns about the safety of the reactor. But, she said, the state is pre-empted from doing that because under federal law, nuclear safety is in the sole jurisdiction of the NRC. She said the state would offer other reasons _ concern about the plant's reliability and economic impacts, for instance _ but that those were "pretexts for nuclear safety."

Entergy is also arguing that since it will be selling power from Vermont Yankee into the wholesale power market and not to Vermont utilities, the state should have little or no role in regulating it.

Assistant Attorney General Scot Kline, arguing for the state, said New Orleans-based Entergy signed an agreement saying it would agree to state oversight when it bought the plant from a group of New England utilities in 2002.

"This case is really about honoring commitments," he said.