Shumlin administration makes its case against Yankee
By Susan Smallheer
Staff Writer | October 25,2012
MONTPELIER — The Shumlin administration, aided by 14 expert witnesses including a former top executive at Vermont Yankee, continued to make its case that Entergy Nuclear doesn’t deserve a state certificate of public good to keep operating for another 20 years.
In filings with the Public Service Board earlier this week, experts testifying on behalf of the state Department of Public Service and the state Agency of Natural Resources were joined by Green Mountain Power and a handful of environmental groups saying Entergy hadn’t made its case under state regulations.
“We believe that Entergy just does not meet its burden,” said Sarah Hofmann, deputy commissioner of the Department of Public Service.
“In the 10 years since Entergy began operating the VY station, Entergy has lost the confidence of the Department (of Public Service) as a fair and trusted business partner, and this weighs against approval of their petition,” said Asa Hopkins, the state’s director of energy policy and planning.
Hopkins pointed to Entergy executive statements regarding the presence of underground radioactive pipes, as well as the company’s “resistance to honoring its commitments to Vermont utilities and ratepayers” over the costs of the collapse of its cooling towers in 2007 and 2008.
The voluminous testimony criticizes Entergy’s estimates of the costs of decommissioning Vermont Yankee, its importance to the New England electric power grid, as well as its environmental impacts, particularly on the fish population in the Connecticut River, where Yankee discharges millions of gallons of 100-degree water daily.
The state’s case comes in anticipation of a public hearing in Vernon next month held by the Public Service Board to gauge public concerns about the re-licensing effort, and a statewide hearing on Vermont Interactive Television later in the month. Technical hearings on the case are currently slated for two weeks in February in Montpelier, with a decision on the state certificate of public good coming sometime in the fall of 2013.
Several nuclear consultants, who analyzed Entergy’s earlier filings with the board, said the company had consistently underestimated the costs of decommissioning Vermont Yankee, and didn’t take into consideration key promises the owners of the state’s only nuclear power plant had made to the state over the years.
Other experts said if Vermont Yankee did shut down, there would be “minimal” effect on Vermont ratepayers, since Green Mountain Power, the state’s largest utility, was not buying power from Entergy and instead was relying on other power sources.
Others said that the great unknown about Vermont Yankee’s continued economic future hinged on the replacement of its troubled condenser, which is 40 years old. Estimates for replacing the condenser’s tubes range from $40 million to $100 million, as well as three weeks additional time offline.
Other witnesses raised questions about Entergy’s business dealings in Vermont, with Green Mountain Power noting that it was currently suing Entergy over extra power costs it incurred because of the 2007 collapse of a section of Yankee’s cooling towers.
Hopkins said that the so-called revenue sharing agreement, which Entergy entered into in 2002 when it bought the plant, had “zero” worth.
Entergy experts had testified that the agreement, which shares profits with Vermont utilities if power prices exceed a certain level, estimated the value at between $10 million to $23 million a year.
Hopkins said that wholesale power prices were low, and would not likely reach the levels needed to trigger the revenue sharing agreement.
Hopkins wrote that the expected price of electricity is not expected to rise above $60 per megawatt hour before 2022, when the revenue sharing agreement expires.
“Given that the strike price begins at $61 in 2012, energy revenue is not expected to provide any value to be shared through the revenue sharing agreement,” Hopkins said.
On the issue of decommissioning, Warren Brewer, an executive with a Virginia nuclear consulting firm, wrote that Entergy had included “overly optimistic” estimates that the Department of Energy would start accepting high level radioactive fuel for storage in 2020.
Additionally, wrote Gregory Maret, a former Entergy Nuclear executive in Vermont, Entergy’s cost estimates for decommissioning did not include money for disposing of concrete rubble from the plant, among other issues.
James Sinclair, a spokesman for Entergy Nuclear, said the company would address questions raised by the state’s consultants in future filings with the board.