Vermont press coverage of Entergy’s diesel generator lawsuit

The Vermont press has done readers a disservice by failing to provide adequate background to assess the issues in this case. In particular, the following points have been ignored:

1) Readers should be aware of the timelines involved here. Rather than present them myself, I quote from “PREFILED REBUTTAL TESTIMONY OF GEORGE THOMAS,” dated March 15, 2013 and submitted as part of Docket 7862 (Entergy’s request for a CPG for continuing operations) concerning the timeline leading up to the filing of the diesel generator case:

“A11. On or about December 21, 2011, ISO-NE first notified Entergy VY that the Vernon Hydro Station would no longer be available under the blackstart program after September 1, 2013. Because having a station blackout power source is required to meet NRC regulation 10 CFR § 50.63, Entergy VY immediately identified various options to address the need for an alternate source of AC backup power. These options included intervening in the relevant ISO-NE/FERC tariff proceeding, (2) developing a contract with the owner/operator of the Vernon Hydro Station to provide station blackout power, (3) installing an off-site diesel generator or (4) installing an on-site diesel generator. Entergy VY initially pursued the options that would not require any additional work on-site, and thus would not have required any approval by the Board. Entergy VY diligently pursued these options, but by April 24, 2012, it became clear that the only viable option was an on-site generator. Entergy VY then evaluated possible on-site locations, performed vendor selection and developed a preliminary design of an on-site diesel [p. 10] generator. Once that was completed, we developed a cost estimate and began the internal process of obtaining management approval for the funding for the project. It should be noted that the final selection of the location to place the generator was complicated by, among other things, the limited footprint of the VY Station and the pre-existing location of certain plant equipment.

“Once these pre-conditions were met, Entergy VY obtained internal approval for the project in mid-July of 2012. Entergy VY promptly submitted its required 45-day notice to the Town of Vernon and the Windham Regional Commission on July 24, 2012, with copies to both the Department and the Board notifying them of the proposed project. While the 45-day notice was pending, Entergy VY contacted the Department on or about August 16, 2012, to discuss the proposal. At the Department’s request, a meeting was scheduled for August 24, 2012, so that both the Commissioner and Deputy Commissioner could attend.

“As soon as the 45-day notice period passed (without any recommendations as contemplated in Section 248(f) by the Town of Vernon or the Windham Regional 17 Commission), Entergy VY filed its petition with the Board on September 7, 2012.

“Q12. At the time Entergy VY approached the Department with respect to the station blackout diesel generator proposal, how much time was there for the Department to consider and react to the proposal? [p. 11]

“A12. Entergy VY approached the Department on August 16, 2012. At that time, based on discussions with TransCanada, Entergy VY understood that TransCanada did not intend to remove the Vernon Hydro Station from the blackstart program until its contract with ISO-NE terminated on September 1, 2013. However, TransCanada was unwilling formally to commit to that date in writing, and it was understood that TransCanada might remove the Vernon Hydro Station from the blackstart program as early as January 1, 2013. At the August 2012 meeting, Entergy VY explained this situation to the Department, and further explained that it might be necessary for an expedited review of the station blackout generator proposal, and a start of construction as early as October 1, 2012, to account for TransCanada’s unwillingness to commit in writing to the September 2013 date. In fact, subsequent to that meeting, the Department itself was able to secure a written commitment from TransCanada not to remove the Vernon Hydro Station from the blackstart program until September 1, 2013.

“On this point, it is important to note that Entergy VY’s petition is under 30 V.S.A. 15 § 248(j), a provision specifically designed to cover projects of limited size and scope, which do not raise significant issues, and which are typically approved without public or evidentiary hearings. In my experience, such petitions are usually resolved within a few months, and it was with this expectation that we approached the Department in August of 2012. [pp. 9-12]”

Readers will note that Entergy took more than 8 months to put this case before the Public Service Board after being notified that the Vernon tie might no longer comply with an NRC rule issued in the 1980s, but the company is now complaining that the PSB is not acting quickly enough.

Finally, it is worth noting that legal intervenors have rights in Board cases, some of which account for some of the “delay,” and that at least one Board member, David Coen, wrote: “In my view, under these circumstances, the Board should not consider Entergy VY’s request to construct additional facilities until either the Company has come back into compliance with Board Orders or the Board has resolved Docket 7862 and determined that issuance of a new CPG promotes the general good of the state.” (Dissent on “ORDER OPENING INVESTIGATION AND NOTICE OF PREHEARING CONFERENCE,” December 27, 2012.

2) The testimony just quoted also makes clear a point relevant to the core legal issue that commentators have been discussing: namely, the Board is not deciding whether or not to reject an option MANDATED by federal safety regulations, but rather whether to accept the option ENTERGY decided was its best choice for meeting the federal regulations.

This is a crucial point, so let me state it differently: the NRC has NOT ordered VY to install the emergency diesel generator in question, and indeed, beyond its longstanding generic regulation, there is no evidence to suggest that the NRC has specifically ordered VY to do ANYTHING about this issue. Instead, confronted with the need for backup power (previously supplied by the Vernon tie and NOT a diesel generator), Entergy has decided that its best option is installing an onsite emergency diesel generator, while explicitly noting that OTHER OPTIONS were available and would have fully complied with the generic NRC regulation.

In particular, this means that in the unlikely event that the Board were to deny Entergy a CPG for its emergency diesel generator in this instance, it would NOT ipso facto be denying Entergy the option to comply with federal regulation, since other options would, by Entergy’s own admission, still be available.

It also means that Entergy’s request is clearly premature given that, as the State’s lawyer pointed out, its request for a permit has neither been granted nor denied. It is a longstanding policy of American courts NOT to decide cases until they are fully “ripe,” in order to avoid making decisions about hypothetical situations which may never arise in actuality. In this instance, Cheryl Hanna points to three possibilities no one of which is compatible with the other 2. If the court were to decide this case on this record, it would be deciding on at least 2 completely hypothetical possibilities.

3) Vermont’s CPG regulations have nothing whatsoever to do with Entergy, nuclear power, or Vermont Yankee in particular, and have been in existence for decades. They apply to ANY generator which sells power offsite. Thus, unlike the case decided by Judge Murtha where the State of Vermont was attempting to regulate Vermont Yankee in particular, here the issue is whether or not there is a conflict between the State’s generic regulation of electricity generation and the NRC’s specific safety regulations pertaining to nuclear power. Given, as noted above, that Entergy would have options of complying with NRC safety regulations without directly confronting longstanding Vermont regulations, the preemption issue seems far less clearly raised than in the previous case.

If a court were to decide that Vermont could not hold Entergy accountable to its own regulation – clearly not related in ANY way to nuclear safety issues – then it would be effectively saying that federal preemption extends to ALL aspects of operating nuclear power plants, and NOT ONLY to the preempted “field” of nuclear health and safety. Suffice it to say that I have never seen anyone show anything in the Atomic Energy Act which would support such a finding, and that all of the case law (with the possible exception of Judge Murtha’s decision!) points in the opposite direction. It would also be saying that the Atomic Energy Act preemptively requires states to allow EVERY option which a nuclear operator might choose, which is logically quite a different decision from saying that the AEA requires states to allow SOME options if the issue is in any way safety related.

4) Finally, one more word about timing. This is not the first time that Entergy has made claims about the amount of time it requires to comply with this or that. As noted in the timeline above, Entergy made claims, which we now know were spurious, about when the Vernon tie would no longer be available in this very docket. Previously, in asking Judge Murtha for an injunction in the preemption case decided last year, Entergy made a series of claims about the timelines required to order fuel for its refueling outage, which slipped over the course of briefs, oral arguments, etc. by a matter of months. There, early July magically morphed over the course of time into September. Since the timing of the PSB decision is crucial to this case, Entergy’s dismal track record in making these timeline statements another pretty important detail.