Delays won't scuttle Vermont Yankee sale, companies say

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Regulatory decisions on the proposed sale of Vermont Yankee may take even longer than previously disclosed, new documents show.

In a brief filed with the Vermont Public Utility Commission, Entergy and NorthStar Group Services - the current and prospective owners of the idled Vernon nuclear plant - acknowledge that the state's review could extend into August and possibly into September.

That would seem to jeopardize the oft-stated goal of the two companies to close on the sale by the end of this year, given the extensive pre-closure work that attorneys have said is required. But an Entergy executive on Tuesday said there's flexibility built into the arrangement.

"Entergy and NorthStar are still targeting a transaction closing by Dec. 31, 2018, pending receipt of the required approvals from the Vermont (Public Utility Commission) and the Nuclear Regulatory Commission," said Mike Twomey, external affairs vice president for Entergy Wholesale Commodities.

"If we are unable to close by the targeted date, the sale agreement allows the parties to continue to work toward closing the transaction up until June 30, 2019," Twomey said.

A spokesperson said NorthStar Chief Executive Officer Scott State concurred with Twomey's assessment.

Entergy, which stopped power production at Vermont Yankee at the end of 2014, wants to sell the plant to NorthStar, a New York-based demolition and remediation company. NorthStar says it can clean up most of the site by the end of 2030 and possibly as soon as 2026, which is decades faster than Entergy's plan.

Both the state utility commission and the NRC have to sign off on the deal, which would be the first of its kind in the United States. That novelty is one reason why the regulatory process is taking longer than initially predicted.

The proposed sale was announced in November 2016. When Entergy and NorthStar filed their initial petition before the utility commission the following month, the companies said they wanted NRC approval by the end of 2017 and a state decision by March 31, 2018.

Those goalposts have moved considerably.

An NRC spokesperson said recently that the commission's review, which has included multiple requests for additional information, will extend into the third quarter.

It now seems that the Public Utility Commission's considerations will take even longer than that. In recent briefs filed with the state, Entergy and NorthStar suggest that the utility commission should wait to see what the NRC does before ruling on the Vermont Yankee sale.

That possibility had been raised in questions asked earlier this year by members of the utility commission. Commissioners wondered why they should rule "without first knowing what the NRC requires or orders," and they also inquired about what would happen if federal regulators impose requirements that conflict with a memorandum of understanding signed in March by Entergy, NorthStar, state agencies and other entities.

Entergy and NorthStar say it would be wise for the state to wait, because the NRC is considering key financial questions relative to the accelerated decommissioning proposal. "If the NRC approves the license transfer, that approval would provide confirmation that the resources will allow for timely radiological decommissioning of the VY Station site as planned by NorthStar," the companies' filing says.

The Vermont Public Service Department, which has taken a lead role among state agencies involved in Vermont Yankee sale talks, says the utility commission is free to act whenever it sees fit. The state and federal reviews "involve vastly different standards and focus on different subject matter," Public Service Department officials wrote in a recent brief.

But the department also says it "would not object if the (utility) commission decided to wait for a NRC decision before issuing its own."

In anticipation of that happening, Entergy and NorthStar are making arrangements for a prolonged schedule. The companies are asking the utility commission to act within 30 days of the NRC's ruling, "to allow for a timely closing of the proposed transaction if approved."

One potential complication is that the March memorandum of understanding gives all involved parties the right to withdraw if the utility commission has not ruled by July 31.

Since that deadline may not be met, Entergy and NorthStar now say they'll "commit not to withdraw from the (memorandum) before Sept. 28, 2018."

Aside from new scheduling information, the latest briefs filed with the state utility commission lay out largely familiar arguments.

State officials, who had raised concerns about NorthStar's ability to complete the Vermont Yankee job, now support the company's plan based on financial and regulatory commitments in the memorandum of understanding signed earlier this year.

"The obligations embodied in the (memorandum) both increase the resources available to complete license termination and site restoration at the VY Station, and also ensure that the state of Vermont has a meaningful seat at the table throughout the life of the project," a Public Service Department brief says.

The department adds that accelerated decommissioning "will provide the state of Vermont and its residents greater and more certain benefits than the status quo, including markedly accelerating the timeline for decommissioning and restoring the VY Station site."

But the Conservation Law Foundation is standing by its opposition to the sale based on financial and liability concerns.

"The (utility) commission should not accept a bad deal just because it is quick, or because that is what is currently being offered," a law foundation brief says. "Rejecting this proposal does not foreclose a better proposal from coming forward. Just as declining an unsatisfactory job offer now does not mean one will remain unemployed forever, rejecting this proposal does not require that the site will not be cleaned up sooner than sixty years."

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