The parties to the planned sale of the Vermont Yankee Nuclear Power Station have not proven there is sufficient funding available to carry out the full decommissioning of the shuttered facility, the state of Vermont said this week.
In a filing Tuesday with the NRC’s Atomic Safety and Licensing Board, the state requested intervention and a hearing in the agency’s consideration of the transfer and amendment of the Vermont Yankee license from owner Entergy to prospective buyer NorthStar Group Services.
Vermont Yankee closed in December 2014 after more than four decades in operation. Entergy announced last November it would sell the plant for a nominal $1,000 to NorthStar, a New York-based cleanup specialist that will take over responsibility for site decommissioning and restoration.
The deal, which the companies hope to seal by the end of 2018, requires approval both from the NRC and the Vermont Public Service Board.
NorthStar, in an updated post-shutdown decommissioning activities report (PSDAR) filed with the federal regulator in April, said it could complete cleanup of Vermont Yankee by 2026 at a cost of $811.5 million plus $30.6 million in pre-closing expenses. That would be nearly 50 years earlier, and hundreds of millions of dollars cheaper, than Entergy’s prior plan.
The new owner would keep roughly half of whatever is left of Vermont Yankee’s decommissioning trust fund after the work is complete. The trust fund held $571.5 million in March, with $23.4 million held separately in a site restoration trust. Additional funding could come from Department of Energy payments for failing to meet its legal obligation to remove spent fuel from U.S. nuclear power plants.
“In general, the State supports moving into immediate decommissioning and restoring the Vermont Yankee site as soon as possible. The State does not, however, believe that such a transaction should be structured to create a significant risk that a new entity begins decommissioning and then runs out of money,” lawyers for Vermont wrote in the June 13 filing. “This could leave the State hosting a partially dismantled industrial site contaminated with radiological and non-radiological hazardous waste.”
Under the Atomic Energy Act and National Environmental Policy Act, the NRC cannot sign off on the license transfer and amendment before accounting for this potential danger, the state contended.
Entergy and NorthStar have not provided the NRC with “sufficient evidence … of financial assurance” that they can carry out the regulatory requirements for transferring and amending the plant’s license, the filing says. It lists eight scenarios in which the decommissioning trust fund could run short, including: delays in work that boost overhead and project management expenses; discovery of radiological or other contamination that had not previously been identified; and various issues involving spent fuel storage, including lower-than-expected liability payments from DOE.
Vermont has for years opposed allowing Entergy to use funds from the decommissioning trust fund for management of spent fuel at the nuclear plant. The NRC has sided with Entergy, but the state made clear this week it does not consider the matter closed.
“The proposed license transfer and amendment and Revised PSDAR rely on the NRC-granted exemption to Entergy that allows $225 million or more to be diverted from the Decommissioning Fund for the non-decommissioning expense of spent fuel management to apply equally to NorthStar’s proposal,” according to the filing. “By allowing the diversion of hundreds of millions of dollars from the Decommissioning Fund for nondecommissioning uses, the NRC greatly increases the chances of a shortfall in the Decommissioning Fund that could leave the site radiologically contaminated. This threatens the financial ability of NorthStar to radiologically decontaminate and restore the Vermont Yankee site.”
Nuclear plant decommissioning cost estimates are, in fact, just forecasts that often underestimate the final price, the state said. Its filing pointed to the experience of the Connecticut Yankee, where decommissioning completed in 2004 cost more than double the projected expense. That was partly due to the need for additional remediation of strontium-90 contamination, which is also found in groundwater at Vermont Yankee, the lawyers wrote.
Entergy is reviewing the state’s intervention request and would file a response with the NRC by the July 10 deadline, Joseph Lynch, the company’s senior government affairs manager for decommissioning, said by email Friday. There was no immediate comment from NorthStar.
The companies have sought to demonstrate they have contingencies in place for unexpected challenges in decommissioning at Vermont Yankee, including a $125 million “support agreement” from NorthStar in the event that additional funding is needed. The state appeared unpersuaded: “The potential cost overruns listed above, either alone or in combination, could lead to more than $125 million in unplanned-for expenses.”
New Public Service Board Chairman Anthony Roisman, who was appointed on Monday, will not participate in the ruling on the sale, Board Clerk Judith Whitney said in a memo Wednesday to the parties in the case. That will leave the decision to board members Margaret Cheney and Sarah Hofmann.
Last Transfer of Vermont Yankee Spent Fuel Begins
Meanwhile, Entergy on Monday announced the start of the final transfer of spent fuel at the Vermont Yankee plant from wet storage into dry casks. Relocating the remaining spent fuel at Vermont Yankee is required as part of the deal with NorthStar, according to a company press release.
Entergy’s existing independent spent fuel storage installation (ISFSI) at Vermont Yankee holds 13 casks that were filled with spent fuel in 2008, 2011, and 2012. It can hold another 23 casks, with the rest to be placed on a second ISFSI now being built and is due for completion this summer.
The installations in total will hold 58 casks, with the fuel transfer covering 2,996 assemblies due for completion by the end of next year. That would be two years earlier than previously anticipated, Entergy said.
The total cost of the project, encompassing loading of the remaining 45 casks and construction of the ISFSI, is forecast at $143 million, Entergy said in March.
The fuel transfer is being conducted by Holtec International, maker of the dry storage casks being used at Vermont Yankee.
Finishing the spent fuel transfer will enable Entergy to enact additional cost savings measures for security, personnel, and maintenance, the press release states. “The complete transfer of fuel to dry storage will enable Entergy to implement certain other changes at the site, subject to NRC approval,” Entergy said Friday by email. “The implementation of those changes will permit the reduction of expenditures from the nuclear decommissioning trust fund by approximately $1.2 million per month based on reduced personnel costs.”
