Thursday, January 19, 2012

A brief summary of the Vermont Yankee decision

A disclaimer: I am not a lawyer (although I play one on TV the internet); I do hold a Ph.D. in Nuclear Engineering however and have at least some basic ability to read indecipherable tomes. End disclaimer

Reading through the court decision rejecting the Vermont legislature's attempt to shut down Vermont Yankee through a pocket veto, several key points come up:

  • The NRC retains sole regulatory authority for nuclear plants on matters of safety: One of the findings of the case was that the Vermont legislature's law requiring legislative approval for a Certificate of Public Good (CPG) on nuclear reactors in the state (i.e., Vermont Yankee) was substantially motivated over concerns of radiological safety. Under the doctrine of federal preemption, it was held that this was an unconstitutional infringement upon the federal government's regulatory powers under the 1954 Atomic Energy Act.
  • The legislature cannot simply declare per-se rulemaking to be "not about safety" to get around pre-emption: This one may seem obvious, but it undergirded the state's rationale for the legislative CPG requirement. In essence, legislators openly admitted their concerns being driven chiefly by radiological safety concerns, although upon receiving semi-competent legal advice, decided to simply use different wording. That being said, the court found significant evidence that despite the stated goals of the legislation, the intent of the legislature was to govern the re-licensing and operation of the Vermont Yankee plant on the basis of safety concerns - the sole domain of the NRC, which granted Entergy a license renewal.
  • Vermont cannot predicate approval of a CPG on favorable electricity sales agreements: Requiring Entergy to sell the state electricity at below-wholesale market prices was found to be an unconstitutional infringement of Entergy's rights under the Commerce Clause. To quote the decision, "The New England Power decision makes clear that a state’s requirement that a wholesale plant satisfy local demands and provide its residents an “economic benefit” not available to customers in other states runs afoul of the Commerce Clause, because it impermissibly burdens interstate commerce."
So what is the end result? Arguably (based upon my limited, non-lawyerly understanding of the decision), the Vermont Legislature may not pre-empt the Vermont Public Service Board on the matter of deciding whether or not to issue a Certificate of Public Good. Further, the VPSG is narrowly constrained in that it may not make considerations of radiological safety in its decision on whether to issue a new CPG to Entergy for Vermont Yankee (i.e., to operate for another 20 years); in general, the allowed space for its decision include economics, impact on the electrical grid, environmental considerations, specifically with comparison to the relevant alternatives.

In this regard, while the continued operation of Vermont Yankee past March is far from certain, it is difficult to make the case that shutting down an operating, licensed nuclear facility (whose capital costs have already been paid) would prove less economically or environmentally viable than the next most plausible alternatives (such as new natural gas plants), particularly given the extremely low operating cost of a fully paid-for nuclear plant.

Note: George Angwin at Yes Vermont Yankee has his own layman's interpretation, which appears to (comfortingly!) agree with my own.

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