Tuesday January 15, 2013

NEW YORK CITY -- A lawyer for the Vermont Attorney General argued in a Manhattan federal appeals court Monday that financial concerns were the driving force in the state Legislature's closure of Vermont Yankee Nuclear Power Plant.

The state is appealing a decision by J. Garvan Murtha, a federal judge in Vermont, that state lawmakers overstepped their authority by considering the plant's safety when deciding whether Vermont Yankee should continue operating. Regulating safety is a function of the Nuclear Regulatory Commission. Entergy Corporation, the New Orleans-based company that owns the power plant, rebuffs the state's argument that lawmakers were primarily worried about financial implications of a possible plant closure.

"Safety was the reason why the state of Vermont wanted to shut down the plant," said Entergy spokesman Jim Steets. "No other reason was plausible. There's no economic reason for shutting down the plant. It just doesn't make any sense. One of the key things that was discussed was this idea that the state of Vermont would be left holding the bag on decommissioning, for example. But it's clear, by law, Entergy is responsible for ensuring appropriate funding for decommissioning."

Kathleen Sullivan, the attorney who argued Entergy's case before three-judge panel on Monday, declined to take questions. Federal rules on decommissioning nuclear sites cover only some of the potential costs associated with a plant closure, said David Frederick, who argued on behalf of Vermont.


Advertisement

"There's a process for dealing with the radioactive materials but then if you have a very large physical plant, the federal government doesn't step in and fund making that into something that is a usable space for people," Frederick said. "There are huge economic costs whenever there's a large plant."

Onlookers familiar with the case said Frederick laid out the most compelling argument thus far for the state, including the clearest articulation yet as to why the state's handling of the power plant was legal.

"It was just much clearer and much more thoughtful about exactly when a state can and can't regulate," said Cheryl Hannah, a professor at Vermont Law School. "You wonder if he had been at the trial, if it would have made a difference."

State Attorney General Bill Sorrell said the decision to hire Frederick, who is based in Washington, D.C., was a way to "fight fire with fire." Sorrell was cautiously optimistic about how judges responded to Frederick's argument.

"There were more questions today that I was pleased to hear than made me cringe," he said.

While the fate of Vermont Yankee hangs in the balance, the case raises broader questions about the role of state government on issues that are also subject to federal regulation.

"This is a big and significant case, not just about nuclear power but just about power in general and state's rights in general," said Sandy Levine, an attorney with the Conservation Law Foundation. "What authority do states have over operations that happen within their borders? I think the arguments were clear today that the state needs to have a role there."

Vermont Law School's Hannah says that if Murtha's decision stands, there may be a chilling effect on what state lawmakers can discuss. Several other states including Massachusetts, New Hampshire, Connecticut, New York, Mississippi and others officially expressed support for Vermont in the case.

Although the Second U.S. Circuit Court of Appeals agreed to take up the case on an expedited schedule, those familiar with the proceedings say they don't expect a decision to come as quickly. Because of the complexity of the case, it could be six months or even a year before a decision is handed down. Although both sides claimed to be buoyed by how they performed on Monday, neither could say with certainty which argument the judges appeared to favor.

"Obviously it's a high-stakes case," Frederick said. "We'll just wait to see what they do."