By John Stang
The U.S. Nuclear Regulatory Commission might not sign off on the sale of the Vermont Yankee nuclear power plant until the third quarter of the year, according to the head of prospective buyer NorthStar Group Services.
NorthStar CEO Scott State made that observation on May 11 during an evidentiary hearing in the Vermont Public Utility Commission’s own evaluation of the proposed ownership transfer.
Vermont Yankee closed in December 2014. Owner Entergy wants to sell it for $1,000 to NorthStar, which would take over responsibility for decommissioning and spent fuel management. The New York City-based company would keep some portion of the plant’s decommissioning trust fund when that work is complete.
The parties have asked the state commission to issue its ruling by July 31 so they can complete the transfer by Dec. 31.
The federal regulator would have to approve transfer of Vermont Yankee’s operations and spent fuel licenses from Entergy to NorthStar. During the hearing, commission staff attorney Lars Bang-Jensen noted that recent news reports had indicated the NRC might make its decision by the end of June, but “your expectation now is it will be sometime in the third quarter of this year?”
State replied: “My gut feeling is third quarter. I mean, I don’t want to encourage them to wait until the third quarter, but having been in business and worked with the government for a long time, that would be a, I think, a fair assessment.”
The third quarter of 2018 ends on Sept. 30. State did not say if a late NRC approval would delay the Dec. 31 target to finish the sale.
The NRC began its review of the sale in 2017, and in April asked NorthStar and Entergy for additional information regarding their financing and capabilities assurances for decommissioning and spent fuel management. The companies missed the initial deadline, but expect to provide the information by Monday.
“There was some additional time needed, I think primarily on the NorthStar side, to come up with the information that was requested,” Mike Twomey, vice president of external affairs for Entergy’s wholesale business, said in testimony on last week. “And our plan is to submit our response on May 21. And then the NRC will do whatever it will do with the information that’s provided.”
The VPUC held evidentiary hearings over several weeks last week and early this week in Montpelier. In an evidentiary hearing, the commissioners and official intervenors to the VPUC review can question witnesses about submitted testimony and other evidentiary material. The hearings focused on whether Entergy and NorthStar have the financial arrangements in place to deal with several worst-case scenarios during decommissioning.
NorthStar says it can complete decommissioning as early as 2026 at a cost of about $811 million, but state agencies and nongovernmental organizations have expressed concern about its projections.
VPUC staff attorney Micah Howe noted Tuesday that decommissioning of the Yankee Rowe, Connecticut Yankee, and Humboldt Bay plants experienced cost overruns from the 1990s to the present. For example: decommissioning of Yankee Rowe in Massachusetts was expected to cost $368 million, but the price tag spiked to $508 million by the time work was done in 2007.
On May 11, Twomey said unknown factors can always pop up in a long, complicated project.
“(Vermont Yankee) will be the largest boiling water reactor to be decommissioned,” said Warren K. Brewer, an engineering consultant hired by the Vermont Department of Public Service.
The Public Service was one of three state agencies authorized to intervene in the VPUC review, along with the Attorney General’s Office and Agency of Natural Resources. Six other groups were also authorized to intervene: the New England Coalition, the Conservation Law Foundation, the Associated Industries of Vermont, the town of Vernon’s Planning and Economic Development Commission, the International Brotherhood of Electrical Workers Local No. 300, and the Abenaki Nation of Missisquoi.
On March 2, Entergy, NorthStar, and all but one of the intervening entities signed a proposed settlement in which the site’s current and prospective owners offered financial assurances and site-remediation terms intended to resolve regulators’ concerns about the deal. The agreement set aside about $200 million in funding from NorthStar to cover any cost overruns in decommissioning.
State and Twomey testified at length that the proposed agreement establishes a legal framework under which NorthStar must complete decommissioning even in the face of delays or unexpected cost increases.
Entergy is required to provide monthly reports on the project’s progress with NorthStar taking over that responsibly when it assumes ownership.
The sole holdout was the Massachusetts-based Conservation Law Foundation.
But testimony indicated no one knew which Vermont public agency would be in charge on ensuring schedules are kept and ensuring finances in the future will meet the proposed agreement’s terms.
