Entergy CEO: Utility Wants Vermont Yankee to Keep Running

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It was the first topic that Entergy CEO J Wayne Leonard tackled in the utility's quarterly earnings call with investors and reporters: What is the future of Vermont Yankee?

"We are committed to maintaining open and timely communications however great the challenge is for gaining public support and disproving a negative that the age of the plant is determinate of its condition, as is essentially the position the governor took last month," said Leonard.

Leonard then quoted Gov. Peter Shumlin as saying VY was "designed to shut down in 2012 and that 40 years is up in 2012." Leonard said this echoed campaign statements Shumlin made, including: "It's old it's tired and it should be retired."

Leonard said the governor is encouraging his counterpart in New York to take a similar approach and oppose the relicensing of Indian Point.

"While states and governors are certainly free to voice their opinions," Leonard added, the Nuclear Regulatory Commission, "which has jurisdiction in these matters must deal with the facts. And the fact is the 40-year life was based on the expected economic life, not the physical life, that nuclear plants were designed for."

Leonard also said despite the tritium leaks and component failures in recent years, Vermont Yankee has remained a reliable power producer and generated cash for Entergy.

"For all the pessimists out there, and I'm sure there may be a few, one thing you should know and that has not been communicated well, Vermont Yankee, at best, has completely covered its overhead," added Leonard.

One year ago, Vermont Yankee learned of two underground pipes that were leaking tritium into the groundwater. The leaks were from pipes that Entergy executives had previously told lawmakers and the Public Service Board never existed. Attorney General BIll Sorrell is still investigating whether Entergy officials lied under oath.

"I had a status meeting within the past two weeks and am hoping for a decision during the time frame of late March to late April," Sorrell told Seven Days. Sorrell has had to recently shift some of the legal team working on the Entergy case to a pending U.S. Supreme Court challenge of a state law, which allows physicians to have their prescribing information kept private from pharmaceutical companies and marketers.

The NRC estimates that more than three million gallons of tritiated water have been released into the groundwater. To date, about 340,000 gallons have been extracted from the ground and treated offsite. State health officials believe the leak began in 2009 and was only discovered and reported in 2010.

Recently, Entergy began to find trace amounts of tritium in wells well outside the known tritium plume, causing them to test for additional leaks. To date, two pipes have been tested and they do not appear to have leaks.

Entergy has been replacing underground and buried pipes and has additional plans to replace pipes during an October refueling outage. Whether it will refuel in October — something it does every 18 months — remains a question mark.

Entergy's earnings call comes on the heels of Gov. Shumlin’s announcement last week that he has set up a “reliability oversight panel” to delve more deeply into how Vermont Yankee can be shut down on time. In addition, Public Service Commissioner Liz Miller has reconvened the Vermont State Nuclear Advisory Panel. The seven-member panel had largely been defunct under her predecessor. The panel will hold its first meeting on Feb. 20 Feb. 22* in Vernon.

A Senate vote last year — orchestrated by then-Senate President Pro Tem Shumlin — effectively put a halt to the state Public Service Board’s review of VY’s request for a renewed certificate of public good. Meanwhile the federal Nuclear Regulatory Commission is closing in on making a final up or down decision on VY’s application to keep running another 20 years.

What are the odds they’ll say yes? To date the NRC has yet to deny a license extension.

And, what happens if the NRC doesn't act before next year when the current operating license expires? Here’s what the NRC itself notes in a 100-plus page FAQ about nuclear power licenses:

Question: "What happens if the review of a license renewal application is not completed before the current license expires?"

Answer: "If the applicant files a sufficiently complete application for renewal of its operating license at least five years before the existing license expires but the renewal of the license is delayed because of administrative or judicial appeal, then the existing license will still be considered valid until a final decision on the renewal application has been made.’”

In other words, VY could argue a year from now that it has a legit license to keep running. And, who’s to stop them? Would the state take Entergy to court or the NRC? As noted last year in Seven Days, the idea of Entergy filing a federal pre-emption lawsuit isn't completely out of the question.

Will Entergy play that card? Leonard wouldn't say in today's earnings call, but he did say the time is nigh to make a decision on how the utility will proceed.

"We are looking for support from the people of Vermont and we are looking for support from the utilities," said Leonard. "We want to be regarded as good partners with Vermont, but at the same time in some respects we're being pushed into a bit of a corner here and there is a point where there is a line in the sand and we'll have to determine if we'll push forward or not."

Leonard said recent comments by the state's largest private employer IBM that its power needs would increase, coupled with calls from various manufacturers and the region's grid operator that VY provides stable and reliable power all weigh in their favor.

Leonard expects that by mid-year Entergy will have a new power purchase agreement with in-state utilities.

*This post has been updated to correct the date of the VSNAP meeting.

Comments

[Steve]

He says one thing...

"We are looking for support from the people of Vermont"

and then issues a thinly veiled threat...

"we're being pushed into a bit of a corner here and there is a point where there is a line in the sand and we'll have to determine if we'll push forward or not."

Just do what we say, and nobody gets hurt.

Release the hounds (lawyers)...

I hope someone or some group (state or private) is getting ready to sue Entergy for lying to and damaging the State of Vermont and its citizens. Maybe they can be "persuaded" as part of a settlement of a class action lawsuit (or and endless series of individual lawsuits) to drop any efforts to stay open beyond 2012.

[webber]

"What are the odds they’ll say yes? To date the NRC has yet to deny a license extension."

Maybe that's because based on the science -- and not on the fear, passion, prejudice, and paranoia -- the extensions were justified.

[Tim]

This is the State of Federalism in 2011. Unelected regulators acting like George III.

[Srat123]

"...the fact is the 40-year life was based on the expected economic life, not the physical life, that nuclear plants were designed for."

Seriously? Because I always thought the longer one keeps an investment alive, the greater the return. Works for real estate, equities, etc. because debt becomes a thing of the past and profits become gravy.

Somebody serve this guy a nice tall glass of Entergy well water....

[Jcarter]

The legislature was informed of the premption issue before they voted. The vote was a publicity stunt by Shummy for his campaign, and one that will cost VT. VY was offering a rate that was equiv or less to that of HQ, but no deals were struck because of the legislative "block". The NRC will claim jurisdiction which they have, and Entergy will sell all their energy on the spot market and let VTer's pay twice as much. In the meantime, gone is the contribution to the clean energy fund and other hoops they currently jump through.

All because Shumlin wants to pull a power trip. Thanks Petey.

VY/Entergy has tried to negotiate with the state to no avail and tried to appease legislators. I hope they file the suit and keep running, and I hope the media will report it as well as the the fact that all this was told to the Legislature BEFORE the vote. Then please print a list of legislators that voted to ignore the NRC's jurisdiction.

[steve-o]

@ JCarter:

"Jurisdiction"?

First, to understand that concept you would have to have a degree from an accredited college, and we're talking about the Vermont legislature here . . . Nuff said.

Second, even assuming the average VT legislator understands the concept of federal pre-emption, they don't give a sh__ because it isn't convenient and doesn't fit with their model of corporate-bashing.

[John Greenberg]

JCarter tells us: "The legislature was informed of the premption issue before they voted." What he neglects to tell us is the substance of what they were told. Quite simply, legislators were advised that they were not allowed to consider nuclear safety issues, but that power planning and other economic considerations were, to coin a phrase, fair game for State consideration.

Current law is guided by the Pacific Gas and Electric case (PG & E v. State Energy Comm'n, 461 U.S. 190 (1983), in which the Supreme Court declared: "From the passage of the Atomic Energy Act in 1954, through several revisions, and to the present day, Congress has preserved the dual regulation of nuclear powered electricity generation: the Federal Government maintains complete control of the safety and "nuclear" aspects of energy generation, whereas the States exercise their traditional authority over economic questions such as the need for additional generating capacity, the type of generating facilities to be licensed, land use, and ratemaking."

The NRC, unlike JCarter, understands this. Here's NRC's answer to an apposite question: "1.2.10 Who makes the decision to actually continue operating the nuclear power facility during the license renewal period once the license renewal is granted?
It is possible that a license renewal application could satisfy the NRC’s safety and environmental reviews and still not operate. This is because the NRC does not have a role in the energy-planning decisions of state regulators and licensee officials. From the perspective of the applicant and the state regulatory authority, the purpose of renewing a license is to maintain the availability of the nuclear facility to meet energy requirements beyond the current term of the facility’s license. Thus, whether the facility will continue to operate is based on factors such as the need for power or other matters within the state’s jurisdiction or the financial interests of the owners."

Indeed, Entergy also understood this when they bought the plant in 2002 and signed a "Memorandum of Understanding," which includes the following: "12. Board Approval of Operating License Renewal: The signatories to this MOU agree that any order issued by the Board granting approval of the sale of VYNPS to ENVY and any Certificate of Public Good ("CPG") issued by the Board to ENVY and ENO will authorize operation of the VYNPS only until March 21, 2012 and thereafter will authorize ENVY and ENO only to decommission the VYNPS. Any such Board order approving the sale shall be so conditioned, and any Board order issuing a CPG to ENVY and ENO shall provide that operation of VYNPS beyond March 21, 2012 shall be allowed only if application for renewal of authority under the CPG to operate the VYNPS is made and granted. Each of VYNPC, CVPS, GMP, ENVY and ENO expressly and irrevocably agrees: (a) that the Board has jurisdiction under current law to grant or deny approval of operation of the VYNPS beyond March 21, 2012 and (b) to waive any claim each may have that federal law preempts the jurisdiction of the Board to take the actions and impose the conditions agreed upon in this paragraph to renew, amend or extend the ENVY CPG and ENO CPG to allow operation of the VYNPS after March 21, 2012, or to decline to so renew, amend or extend."

Despite attempts to read more into his comments than was actually stated, I believe Mr. Leonard knows that as well. Given that, in his words "at best" VY "has simply covered its fully allocated overhead," there appears to be exceedingly little (actually, nothing) to motivate Entergy to undertake an expensive lawsuit, which they already know they can't win. Time will tell.

[Jcarter]

John Greenberg, you are incorrect on so many levels and We have had this discussions. If you would like to continue to ignore relevant court decisions and precedent and misread things that's your business.

For accuracy :

PC&G does NOT control here, you cite a 1983 deciscion that has been raised to the PSB and dispelled in responding documents.

Secondly, your quote from the NRC provides a facility may not be run......blah blah blah refers to the fact the OWNERS may not wish to operate it. It has nothing to do with a state legislature deciding that fact.

So there is a question of safety and need. That's what the state can try and base a court case on. Need? Well we are still missing about half of our power needs, so that's a tough sell. Safety... well considering the NRC, the VT dept of Health, and Blue Ribbon Shumlin appointed commission all deemed VY to be safe... that's a pretty tough sell to.

So what safety issues can they raise? Senators were told what their authority was before they voted. They are not within their authority here and Entergy will continue operation of VY long after 2012.

The basis of pre-emption from the PSB
"[the Board is] not preempted from taking action in response to the leaks at
Vermont Yankee, to the extent that the leaks may have economic and other nonradiological-
health-and-safety consequences"

Notice John Greenberg "TO THE EXTENT THAT"

The PSB can not consider the radiological aspect of the plant or safety issues surrounding radiological exposure. Only if there is an economic or non-radiological saftey consequence. Interestingly they only note the lack of decomissioning money.

Now that seems to be an easy fix for Entergy if they want to continue to operate. Heck, since they can sell ALL the power and not add millions to the clean energy fund, bumping up the decomissioning fund should be a drop in the bucket.

[John Greenberg]

Yes, JCarter, we have had this discussion before. Apparently, you're a slow learner. Let's take your points in order:

1) You write: "PC&G does NOT control here, you cite a 1983 deciscion [sic] that has been raised to the PSB and dispelled in responding documents." Actually, every one of the briefs by ALL of the parties on the subject of federal preemption centers around the 1983 decision, for the obvious reason that it's the controlling decision. Entergy (and its junior partner IBEW) attempt to bend the decision over backwards, contorting the clear language of the Court. All of the other parties, including the Department of Pubic Service under David O'Brien, address the decision straightforwardly. Had Entergy's interpretation been accepted by the PSB, presumably Docket 7600 would have ended several months ago, since Entergy's position is that the Board has NO jurisdiction. But as the New England Coalition brief pointed out, Entergy has raised precisely the same arguments repeatedly before the Board in a succession of dockets, only to be shot down in each case. The Board has yet to issue a ruling on the matter in Docket 7600. (I should add, if the preemption issue been as obvious as you think it is, Docket 7600 would never have been opened.)

It is important to add, in any case, that Docket 7600, since it concerns leaks of radioactive materials, especially tritium, is inherently more subtle than the issue of relicensing from a preemption point of view. Are the leaks to be viewed from the perspective of groundwater contamination -- usually a state issue -- or are they part of the "nuclear aapects" of nuclear power referred to in PG&E, which would make them a federal matter?

By re-raising the issue at the end of your comments, and emphasizing the words "to the extent that," you underscore my last point: Docket 7600 is much more complicated, from a legal point of view, than the issue of relicensing. You put it quite well: "The PSB can not consider the radiological aspect of the plant or safety issues surrounding radiological exposure," yet in the case of VY's tritium leaks, the Board is left with deciding whether groundwater contamination is or isn't an issue of radiological exposure.

By contrast, the thousands of pages of testimony on which the legislature based its decision last year had NOTHING to do with safety. Instead, they concerned financial, economic, ratemaking, alternative energy and other areas, with virtually NO attention given to nuclear safety, precisely because it is a preempted matter. There was an examination of whether the plant could operate reliably for the next 20 years, but it played a relatively minor role in the testimony and decision. The legislature acted in exactly the areas PG&E says it can, precisely because it was cognizant of and had been advised about the law, as you pointed out yourself in your previous comment. The first briefing on the topic was by former Board chair Mike Dworkin on November 19, 2008, and cited, wait for it, the very words of the PG&E decision I quoted in my previous comment (see slides 10-11: "Does Federal Law Trump State Regulation?)

2) You overlook the obvious meaning of the NRC quote when you write: "Secondly, your quote from the NRC provides a facility may not be run......blah blah blah refers to the fact the OWNERS may not wish to operate it. It has nothing to do with a state legislature deciding that fact."

Let's try the quote again: "... the NRC does not have a role in the energy-planning decisions of state regulators..." And taking the owners out to simplify this for you: "From the perspective of ... the state regulatory authority, the purpose of renewing a license is to maintain the availability of the nuclear facility to meet energy requirements beyond the current term of the facility’s license. Thus, whether the facility will continue to operate is based on factors such as the need for power or other matters within the state’s jurisdiction ...." The NRC properly believes the matter is shared between its own authority in matters of safety and the "nuclear aspects" of nuclear power, the State, in its "traditional" role, and (of course) the owners who have their own issues and perspectives.

3) "So there is a question of safety and need. That's what the state can try and base a court case on." This is just plain wrong. First, the question of safety is precisely the one the state can NOT raise to defend itself. Second, need for power is NOT the only issue on which it CAN base its decision. If it were, the case would be simple. New England is swimming in power; VY isn't needed. In fact, there's roughly 8 times more EXCESS power than VY generates. There was plenty of testimony before the legislature to precisely this effect.

Significant issues concerning Entergy's ability and willingness to properly decommission the plant, the timing of decommissioning, and whether or not Entergy would comply with the terms of its MOU to return the site to a green field were raised both in the legislative testimony and in Public Service Board testimony, briefs, and hearings. The Enexus deal was still pending during legislative consideration and Entergy officials insisted that they would move forward with relicensing ONLY if the Enexus deal were accepted. The VY power contract offered to and rejected by Vermont utilities actually came from Enexus, NOT from Entergy. Without naming names, I suspect that several senate votes were lost because of the tremendous skepticism and downright repugnance the attempted Enexus spin-off rightly caused in the legislature. Other issues included the legislature's desire to move towards renewable sources of power and towards greater efficiency, the utilities' expressed desire to diversify their energy portfolios, not to mention, of course, the key issue of rate impacts. Many more topics were raised and discussed at considerable length during both legislative and Board testimony. All of these areas are perfectly legitimate to consider from a preemption point of view, and in fact, most of them aren't considered by the NRC, again because they fall under State, not federal, jurisdiction.

4) "Well we are still missing about half of our power needs, so that's a tough sell." This is just plain silly. As pointed out above, New England is awash in power. VY has been supplying about 1/3, not 1/2, of VT's needs under the existing contract, and ALL parties are agreed that this figure should be lower, EVEN IF the plant continues to operate. As pointed out above, the utilities are quite clear on their desire to diversify away from VY in ANY case. The proposed VY contract was for roughly 1/6, not 1/2 of VT's power needs. As to whether ANY of the power needed to supply VT is "still missing" after all the deals announced in the last 2 years, I really can't say. But whatever the figure is, if any, it's got to be quite low, and easily made up in diverse ways. The easiest, though far from the cleanest or best, would be a market power purchase. The best, cleanest, and cheapest would be from increasing the State's efficiency programs.

5) There is no "Blue Ribbon Shumlin appointed commission," though as governor, he's announced he plans to appoint one to consider decommissioning issues. There is an Oversight panel, only one member of which was appointed by Shumlin (as Majority leader of the Senate), and it did NOT declare VY to be "safe," precisely again, because that is NOT an issue for the State to consider. It declared that, if some 90 conditions were met (few of which have been), the plant could probably operate reliably for the next 20 years.

[Jcarter]

John,

1.) Lawyers against Entergy keep raising the issue, that doesn't mean it applies. They can argue that tritium leaks contaminate the ground water and that's a land use issue, but considering it naturally decays in roughly 7 days that pretty much null in voids their concerns. Moreover groundwater like the CT river is not VT's to be concerned with.

2.) Needs, here your mistake is the idea that if VT doesn't need the energy they have the option to shut it down. Since we are all part of the grid that doesn't apply, that energy is provided and sold over state lines. Needs is not something for the state to decide. Moreover, please indicate your figures on needs. My count is we lost 1/3rd from VY, there was also a decrease in the contract with HQ from our current contract. THere is a token amount of wind, methane, solar, but it may be able to compensate for the loss in HQ power at best. Ergo we are still missing a contract for roughly 1/3rd of VT's power needs. I know you favor buying off the spot. I don't believe that's a viable alternative. We can agree to disagree.

Finally, the Legislature led by Shumlin appointed a Blue Ribbon Committee to asses VY and it's ability to provide safe and reliable power. Their conclusion was that they could, albiet with a change of management priorities or something to that effect. I forget how they actually worded it.

But lets simplify :

You believe that there is an excess of power and are willing to bank on that fact as well as that it will continue through the next 20years.

I don't think that's the case, and am not comfortable going without contracted power for nearly a third of the states power needs.

You cite testimony by experts.... great, acknowledge their is expert testimony on both sides with both opinions.

You believe the state has authority to shut down VY.

I think it's a crock.

Very simply, a court will decide. I am willing to wager $100 to the charity of your choice that VY is operating in 2013. Let me know if you are.

[John Greenberg]

JCarter can make up "facts" faster than anyone can answer them. I assume, since there is now no response to any of the previously raised issues that he or she now concedes those points.

So, moving on:

1) "Lawyers against Entergy keep raising the issue, that doesn't mean it applies." I assume "the issue" here means preemption. Actually, it's Entergy, not the lawyers against Entergy, which keeps making claims of preemption in Board preceedings. But in Docket 7600, the Public Service Board itself asked for briefing on the issue. For the reasons I previously sketched, preemption is a knotty issue in the tritium case.
2) "They can argue that tritium leaks contaminate the ground water and that's a land use issue, but considering it naturally decays in roughly 7 days ..." Tritium has a half life of 12.26 years, which means that in that period of time, 1/2 of its radioactivity will have decayed. The usual rule of thumb is that a radioactive substance is considered no longer hazardous after 10 half-lives, or, in this case, 122.6 years. As usual, JCarter is simply inventing "facts" to suit his or her case.
3) Need for electricity. First, let's note that it was JCarter him or herself who brought this up, as one of the 2 possible items for a preemption defense. That said:
a) "your mistake is the idea that if VT doesn't need the energy they have the option to shut it down." If this is a legal argument, I've responded to it more than once. I take it, however, to now be shifting to a policy argument, clarified by:
b) "Since we are all part of the grid that doesn't apply, that energy is provided and sold over state lines." True enough. The surplus is, in fact, in the whole New England grid system. The ISO system requires about 32,000 MW including reserve capacity (it actually uses about 28,000 MW at peak). In the last 3 auctions, offers came to around 40,000 MW, meaning that there were offers of roughly 8,000 MW more than is needed. VY generates 640 MW.
Neither a) nor b) leads to the conclusion:
c) "Needs is not something for the state to decide." Indeed, nothing leads us there, since it is ABSOLUTELY something for the state to decide, both as a matter of policy and as a question of law. Obviously, in making that decision, states consider testimony from utilities, regulators, and other experts, as well they should.
4) As to trying to estimate Vermont's own power needs in the future with any kind of precision, many of the facts are not available to the public, and most of the contract information that is available is released piecemeal, making it very difficult to tally. Suffice it to say that the utilities, whose job it is to keep the lights on, have testified that they can and will replace VY power if necessary (although both GMP and CVPS support continued VY operations). More substantive discussion is for another time and place (I have written amply on this subject elsewhere).
5) "... the Legislature led by Shumlin appointed a Blue Ribbon Committee to asses[sic] VY and it's [sic] ability to provide safe and reliable power." Actually, Shumlin, as then-Senate Majority Leader, appointed one member of the Oversight Panel, then-Speaker Symington appointed another, and then-Governor Douglas appointed a third. These 3 members then appointed the other 2. The Panel found the plant could be operated reliably in the future, IF a variety of conditions were met. Many haven't been.

[webber]

@ Mr. Greenberg:

1. Are you a lawyer? Do you specialize in federal pre-emption and/or jurisdictional issues? I don't see you listed as a Vermont-licensed attorney.

2. Everything I've read says that if you pass through the security scanner a couple of times a year at an airport, you've been exposed to far more radiation thatn you could ever get from drinking the low-leve tritiated water at issue at the VY plant. Do you have any actual "facts" that say otherwise?

3. Yes, the utilities say they can replace the lost VY power but there's absolutely no dispute that: a) the replacement cost, which will be bought on the spot market, will definitely be higher; b) that replacement power WILL come from polluting coal-fired power plants (from the very same companies that the Vermont AG is now suing for sending their airborne pollution into VT); and c) the money that is spent on that replacement power will not be going to VT workers and taxpayers.

4. Not only did the blue ribbon panel put together by VY-hating Shumlin say that VY could be operated safely well into the future, but you fail to point out the very significant fact that that panel included Shumlin's hand-picked VY-basher, Arnie Gunderson, and he, too, was on board with the panel's conclusion. So even when Shumlin stakced the deck, the conclusion didn't come out the way he wanted it to, so now he's just ignoring his own panel for purely political reasons.

5. So now we have not only the NRC experts repeatedly saying that the plant is safe, but we have a committee of Vermont homegrown experts (including at least one well-known critic of VY) saying the very same thing.

All of which proves to me that the anti-nuke ideologues don't care about what any expert says if it doesn't support their already-formed conclusion that VY must be shut down.

[John Greenberg]

"Webber" raises a few new issues and repeats some old ones:

1) No, I'm not an attorney. But I have made an in-depth study of federal preemption issues as they pertain to nuclear power. I spoke to some of the best lawyers in Vermont (and outside) who work in this narrow area of law on an ongoing basis, and read every case to which they could direct me or that I could find. I rechecked my conclusions with further conversations, just to make certain I wasn't missing anything.

But my qualifications are hardly the issue here. The question is: what does case law say? I've quoted it; I've noted that every attorney (whether supporting or opposing the idea that the State is preempted) in Docket 7600 centers their brief around the same opinion, and I note that no one has presented anything whatever to contest this except some general rhetoric. If there is an argument against my summary of the issue, let's hear it. Otherwise, it's time to move on.
2) Webber writes: "... there's absolutely no dispute that:
"a) the replacement cost, which will be bought on the spot market, will definitely be higher ..." There most certainly IS a dispute about that. Indeed, current evidence suggests precisely the opposite: namely, that IF replacement power is bought at market prices, its cost will be (slightly) lower than the contract proposed by Entergy (actually Enexus) for VY power. As I have noted before, however, there are MANY ways to replace this power, with a considerable range of costs involved.
"b) that replacement power WILL come from polluting coal-fired power plants (from the very same companies that the Vermont AG is now suing for sending their airborne pollution into VT)..." Around 10% of the power on the New England grid comes from coal, and as noted, grid power is NOT the only alternative.
"c) the money that is spent on that replacement power will not be going to VT workers and taxpayers." This is certainly true IF the replacement power comes from the grid or from out-of-state power contracts (some of which have already been signed). That's precisely why, 2 years ago, my colleague Michael Daley and I wrote a report recommending that VY power be replaced by a combination of increased efficiency efforts and Vermont based renewables, especially wind and biomass. A 2007 DPS report shows that efficiency alone can account for up to 215 MW in VT by 2015, while saving the state just shy of $1 billion. (The spreadsheets and writings I developed with and without Michael use a MUCH lower figure in order to be extremely conservative). This "power" would cost somewhat less than 1/2 of the VY proposed contract, and could therefore offset more expensive wind and biomass developments in a balanced portfolio. Again, depending on the precise details of how such a portfolio is constructed, ratepayer impact should be minimal, and hundreds to thousands of new Vermont jobs would be created, vastly offsetting those lost at VY. Energy Efficiency Vermont alone already employs about 1/3 of the workforce of VY, at current much lower levels of efficiency promotion.
3) For the 3rd time, the Oversight Panel -- which JCarter and now Webber insist on calling the "blue ribbon" panel -- was NOT put together by Shumlin. Shumlin appointed one member, who was a nuclear utility executive for 20 years. As to Shumlin's motivations and actions, I'll let him speak for himself. As to the Oversight Panel's conclusion, readers should consult the report. I've twice commented that its conclusion is quite guarded: namely, that if around 90+ measures are taken, VY should be able to operate reliably. My grandmother could have lived forever, if only she had replaced her heart, lungs, kidneys, liver, etc. etc.
4) "So now we have not only the NRC experts repeatedly saying that the plant is safe..." Actually, the NRC has yet to rule. That's precisely the function of their relicensing proceedings, and which are still ongoing. I have no doubt the NRC WILL come to that conclusion however: they always do.

[Jcarter]

1.) You should spend a little more time looking at the case that will go against Entergy. You have a clear bias and currently you are not looking at things from an impartial viewpoint. Which essentially makes these arguments pointless.

2.)The spot market is lower then contracted rates TODAY, it's unlikely that in 20 years from now they will be.

3.) John was Shumlin in charge of the Legislature when the oversight Panel was created? Of course he was, thus it was a Shumlin created panel.

4.) The NRC has stated that the Tritium leaks at the plant are not at levels that constitute a hazard. That the plant is operating safely.

[Doug Hoffer]

JCarter

The price of Entergy's last offer would have been pegged to market prices and would have escalated over time. And you can bet their next offer will do the same.

As for bias, you are the one who referred to our new governor as "Shummy" and "Petey." That kind of disrespect looks a lot like bias to me.

[Jcarter]

Because I think Shummy is a snake has no effect on my opinion of VY or our energy needs. That type of disrespect should look like disrespect, if it looks like anything else, perhaps you should alter your perspective. I'm sure if you tried hard enough you could work in a Bush or Palin quip somewhere.

As for the price of energy, yes Entergy's OFFER had an inflation tie in. So? Do you really think the spot market will stay stable for 20 years? Will inflation sky rocket? HQ has a similar provision and the same price (which was a "good deal" according to the power companies. So is HQ a bad deal? Moreover it is AN OFFER! Do you think perhaps if GMP said we'll buy X KWH for 5.5 cents they would turn it down? Do you think they wouldn't negotiate with power companies if the Legislature decided to let PSB give them a CPG? Of course not. You know numbers Doug.... figure it out.

[webber]

@ Greenberg:

Apparently, absolutely and positively nobody but you believes that Vermont can "save" or renewable-ize" our way out of the need for reliable, inexpensive baseload power at any time in the near future.

Nobody's building a biomass plant in Vermont (because you and all your friends would fight it being in your town), and even if we put 100 wind turbines on every peak in Vermont tomorrow (which the NIMBYists will also fight), it still wouldn't provide but a fraction of the $.06 per killowat hour energy we currently get from VY, and it wouldn't be on all the time. And even if we put all those turbines up, and even if they produced power all the time, they do so only at an enormous subsidy.

Jesus. Put the goddam bong down and check out reality.

Shutting down VY will kill the Vermont economy, which is already fragile enought as it is.

[Jcarter]

"And even if we put all those turbines up, and even if they produced power all the time, they do so only at an enormous subsidy."

The real kicker of this... it's VY that provides all the money for the Clean Energy Development Fund that coughs up the millions to the likes of Bittersdorf et al.

Wind and Solar wouldn't exist without VY and they won't grow any further if VY were to be shut down.

[webber]

"Wind and Solar wouldn't exist without VY and they won't grow any further if VY were to be shut down."

Dammit, JCarter, why do you insist on bumming us out with depressing facts like this? I'm sure that Vermonters would be happy to step up to the plate and shell out the hundreds of millions of dollars to subsidize wind and solar after we kill off VY and its CEDF money!

That is, any Vermonters who are still employed after VY is dead, and after they've paid double their current elecricity bill.

At that point, I'm sure, when asked, all the unemployed VYers, and all the unemployed IBMers, will joyfully say, "Sure, in addition to the huge per-KW-hour rates I'm now seeing on my electricity bill, please ALSO hit me with a surtax to replenish the Clean Energy Development Fund that VY is no longer funding."

Hmm. But then they might say, "Hey, wait. Aren't I ALREADY paying a lot for that wind power in the rates on my electricity bill? And now you also want me to pay a separate surtax to fund the subsidy fee for the development of that very same wind power? Isn't that, um, a double whammy? So, instead of paying $.06 per KW hour for my electricity, I'm now effectively paying $.30 when you add in my surtax for the CEDF?"

Yup.

[Jcarter]

Webber,

They can just stop by the magic money tree that Shumlin has growing in the Gov's office.

[John Greenberg]

The VY propaganda manufacturing factory must be working overtime. Answering the latest bunch of lies, nonsense, red herrings, misconstructions, etc.:
1) JCarter writes: "The spot market is lower then contracted rates TODAY..." The market price that I have been referring to is NOT today's. It is the price which is anticipated (by utility experts) beginning in March, 2012, which is the relevant price when comparing to VY's new contract, which would begin at that time.
Market prices for electricity are extremely volatile. They rise and fall in daily, seasonal and weather related patterns, but they also move in all sorts of unexpected ways. There is much "expert" testimony based on predicting them, all of which, at least in the last few years, have been dramatically revised multiple times.
I am NOT an expert and have never represented myself as one. I have no idea what market prices will look like 20 years from now. I do, however, have a pretty certain notion that no one else does either, given the evidence I've seen in the last few years.
2) JCarter writes: "was Shumlin in charge of the Legislature when the oversight Panel was created?" First, the Speaker of the House might have a word or two about that. Second, the Majority Leader is "in charge of" the Senate in the sense that he or she certainly attempts to guide it, in many cases, successfully. But that's not always so easy: ask Harry Reid. And, in any case, he or she does NOT replace the Senate and vote out legislation single-handedly. The law creating the Oversight Panel was created by the whole legislature and signed by the governor, just like any other law. Shumlin was certainly one of the key legislative players, though equally certainly not the only one.
3) JCarter writes: "The NRC has stated that the Tritium leaks at the plant are not at levels that constitute a hazard. That the plant is operating safely." True, but irrelevant in a discussion of relicensing. What the NRC has NOT said yet is whether the plant can operate safely for the next 20 years. They will do so, if they do, when they actually re-license the plant. My car is operating safely now, but I doubt very much if it will be 20 years from now.
In any case, these are 2 separate judgments, and, so far, the NRC has made only one of them.
4) Doug Hoffer writes: "The price of Entergy's last offer would have been pegged to market prices...." Not so. The offer was at a fixed price of 6.1 cents for the year between 2012 and 2013. The offer then had the price escalator that Hoffer correctly mentions built into it, so that, in the next year, it would have been 6.1 cents + the escalator, and so on each following year. This means, in particular, that the price of the VY contract would NEVER fall below the initial price of 6.1 cents and that it is virtually guaranteed to rise every year.
The HQ contract, as I understand it from press reports, begins with a "smoothed" market price, and then periodically adjusts to market prices. This means that if the market price for power falls in a given year (as it did in 2008), the HQ contract price will fall with it. If it rises sharply in another year, the HQ contract will follow it up. Even with the smoothing mechanism, HQ prices are likely to fluctuate enormously.
In other words, regardless of power source and other differences (station vs. system power), these are completely different TYPES of contract. The VY contract operates somewhat like a fixed rate security with a built-in escalator. The HQ contract is more like a floating rate security.
5) JCarter presents this fantasy: "Do you think perhaps if GMP said we'll buy X KWH for 5.5 cents they would turn it down? Do you think they wouldn't negotiate with power companies if the Legislature decided to let PSB give them a CPG? Of course not." What does JCarter think has been happening for the last 3 years??
The utilities have been negotiating all of this time, as they have periodically told both the Public Service Board (under oath) and the press. They have been unable to reach an agreement, which was the PREMISE of Jay Thayer's letter making the price offer we've been discussing. The parties claim they are still negotiating and recent press reports have suggested they are close to agreement. Nevertheless, no other offer has ever emerged, at least so far.
6) Webber writes: "Apparently, absolutely and positively nobody but you believes that Vermont can "save" or renewable-ize" our way out of the need for reliable, inexpensive baseload power at any time in the near future." Actually, there are at least 3 such plans which have been presented, including a plan presented by the Department of Public Service as testimony both to the legislature and to the Public Service Board. Meanwhile, the utilities are rapidly making this issue moot by signing contract after contract for renewable power (unfortunately, some of it is out of state) and also by constructing their own power projects in Vermont.
7) Webber also tells us "Nobody's building a biomass plant in Vermont," which will come as shocking news to the Beaver Woods folks who are currently seeking permits for two of them.
8) All of the discussion of subsidies for renewables, by Webber and JCarter is a canard. Every form of energy production in the United States has been subsidized. Who do you think did the research and development from which nuclear power plants developed? Who has provided Price Anderson insurance since 1956 because the free market refused to? Who is currently providing loan guarantees because capital markets refuse to do so? Etc. etc. Nuclear power has received and is still receiving billions in subsidies, just as coal, oil, biofuels, natural gas, and every other source, real and imagined.
9) Webber: "...after VY is dead, and after they've paid double their current elecricity [sic] bill." As Ronald Reagan put it: "There you go again." It's time for Webber to present the figures on which this ongoing lie is based, or withdraw the statement. The utilities testified to possible rate increases of 3-7.5% at a time when they expected higher market prices than they do now. The actual effect of closing VY and buying from the market (one of many solutions, and NOT the best) would be a small price decrease.
Finally, JCarter tells me "You have a clear bias and currently you are not looking at things from an impartial viewpoint." There's an old legal dictum: When the law is against you, argue the facts. When the facts are against you, argue the law. When both are against you, attack the plaintiff. Good move!

[Jcarter]

OK John,

1.) You still didn't address future prices. So in 2012 you have a PREDICTION. What about 2022 or 2032. Do you think spot prices will be less the $0.06/KWH?

2.) Semantics. The fact is who created it has little bearing on the fact their assessment was that VY can operate safely. It could have been created by Symington, Smith, etc. The fact that an ANTI Yankee legislature created it however does provide credibility that if it were unsafe the panel would have stated as much

3.) Irrevelant? Ok, I guess predictions of prices in 2 years are, but past performance isn't?

4.) So offers that weren't accepted are also relevent?

5.) Fantasy? Well here I concede to you John, the offer VY stated along with projections of energy prices as well as any negotiations that have not been agreed upon and contracted for would/could be considered fantasy.

6.) Sure several companies are making plans, Webber also addressed it. GMP is making plans for a wind farm in Lowell. It still needs approval. Until it gets approval it is um.... fantasy.

8.) You are building quite the straw man there John. I nor Webber said anything about subsidies other then VY is where the subsidies for wind and solar are coming from. Without VY there is no CEDF, the state doesn't have 10Million to put into them every year.

Finally, John you end with a catchy quote. What does it mean when you build straw men to knock over and fail to address points?

Oh, interesting article in the BFP today... it is oddle relevant to the spot market and pricing.

"An August report from ISO-New England said, “The studies completed so far have shown that with or without Vermont Yankee, the system in Vermont has reliability issues that must be addressed; without Vermont Yankee in service, those issues are more severe and could affect neighboring areas. The potential reliability issues could include thermal overloads on high-voltage transmission lines and voltage instability, either of which could damage equipment, compromise grid stability, or cause uncontrolled outages.”"

Yup, plenty of power.

[webber]

"7) Webber also tells us "Nobody's building a biomass plant in Vermont," which will come as shocking news to the Beaver Woods folks who are currently seeking permits for two of them."

So, where are these projects in the regulatory/permitting process? Exactly when will they come online (if ever)? How much power will they produce?

To replace VY's baseload power (not to mention the taxes it and its employees pay, and their contribution to the VT economy, and the CEDF and other funds we currently extort from them), we need about 300-400 MWs of baseload power at about $.06 per, especially at the alarming rate you're using electricity to post your fantasies on this blog.

[Jcarter]

Webber,
tit tit, only John Greenberg gets to criticize other people's arguments as fantasy.

[John Greenberg]

Here we go again:
1) JCarter: "You still didn't address future prices." Actually, I did, though not in the way JCarter wishes. I wrote: "I have no idea what market prices will look like 20 years from now. I do, however, have a pretty certain notion that no one else does either, given the evidence I've seen in the last few years." If JCarter wants to give us a prediction and tell us how he made it, and what his track record for such predictions has been, that's fine. Otherwise, I'll stand by my comment: I have yet to see anyone make these predictions with any success.
a) "Do you think spot prices will be less the $0.06/KWH?" Even if we buy into JCarter's notion that market prices are predictable, that's the wrong question. The VY proposed price is 6.1 cents for 2012, and it will never go down to 6 cents. But much more importantly, it then rises every year as has been pointed out multiple times in these comments. Unlike Carter, I don't know how much the price escalator will rise, since that involves a prediction about the future price of uranium, cost of specialized utility labor, and general economic inflation. (These predictions are a tad less dicey than market price projections, but still highly problematic.) However, I do know that historically, this escalator has risen about 4% per year. If we use that figure and project the VY contract figure forward, JCarter's question should be, do I think spot market prices will be less than 12.9 cents a year in 20 years.
My answer, however, remains the same. I don't know, and neither does JCarter, nor anyone else. But at least now the question is correctly framed for this debate.
2) "The fact is who created it has little bearing..." except that YOU insisted, repeatedly, on calling it the Shumlin "blue ribbon" panel. "The fact that an ANTI Yankee legislature created it however does provide credibility that if it were unsafe the panel would have stated as much." The legislature which created the panel was NOT anti-VY, though obviously some members were, nor was the governor who signed the bill. Remember, the panel was created in 2008. Most of the estimates I saw and heard at that time were that if a vote on VY were held, the plant would win overwhelmingly. Sure, the legislature turned against VY as it got better informed, but it didn't start there.
Moreover, the Oversight Panel did not conclude that VY is reliable (and they didn't consider safety), as JCarter keeps asserting. They concluded it MIGHT be reliable IF.... There's a difference, which JCarter finds it convenient to ignore.
3) "Irrevelant? [sic] Ok, I guess predictions of prices in 2 years are, but past performance isn't?" I don't know what this is talking about.
4) "So offers that weren't accepted are also relevent[sic]?" There's only one offer, and it's the only price which has been presented to the public for VY power after 2012. It is relevant because a) It is a filing to the Public Service Board in the docket opened to consider whether or not VY should receive a Certificate of Public Good (and therefore was used in those deliberations), and 2) it indicates quite clearly the lowest price Entergy was willing to accept, at least in December 2008. Given that there is no better price indication to use, anyone wanting to discuss rate impacts of closing VY needs to use these contract prices as a starting point, just as JCarter and I both do.
5) The difference between these prices (remember, 6.1 cents is only the INITIAL price) and those imagined by JCarter is just that: JCarter imagines, presumably without having consulted GMP, a price that GMP might offer to pay, & then imagines that Entergy would accept it, again without consulting Entergy, and despite the fact that Entergy told the Public Service Board their best offer was considerably higher, and that they had failed to reach agreement with the utilities, after 2 years of negotiations. If JCarter wants to tell us that GMP and Entergy have given him the right to represent their negotiating positions in these columns, I will stand corrected.
Otherwise, unlike JCarter, I think it is reasonable to distinguish a matter of public record from a set of counterfactual hypotheses pulled out of thin air, especially when these latter contradict the known public record.
6) Power companies are doing more than "making plans." They're signing contracts for power, quite a number of which have been reported by the press. The HQ contract is not just an offer; it's a contract, signed and agreed to by both parties.
7) "I nor Webber said anything about subsidies other then VY is where the subsidies for wind and solar are coming from." Webber: "And even if we put all those turbines up, and even if they produced power all the time, they do so only at an enormous subsidy." It is also worth noting that, in addition to funds from VY, the Clean Energy Development fund includes millions of federal dollars.
8) The BFP article quoted by JCarter actually says NOTHING about the amount of power available. It concerns the transmission system, quotes ISO as saying that "with or without Vermont Yankee, the system in Vermont has reliability issues that must be addressed," and notes that the utilities have until 2016 to fix the problem. Indeed, it quotes VELCO chair Chris Dutton thus: "“I’m beginning to sense the world isn’t going to come to an end in March 2012,” Dutton told the committee. “Many of us are beginning to feel a little better about this situation than we were.“"
9) Webber wants to know "So, where are these projects in the regulatory/permitting process?" You mean the projects that "Nobody's building ... in Vermont?" Try reading the papers. It's their job, not mine, to keep you informed.
10) Perhaps Webber can tell us exactly how he arrived at these 3 conclusions: "we need about 300-400 MWs of baseload power at about $.06 per". The 3 separate conclusions are 1) the amount of power (300-400 MW) 2) the notion that it needs to be "baseload power" and 3) the price.

[Jcarter]

I apologize for that comment, I would edit it back out if I could.

But of note, while it is certainly abusive, defamatory.... that might be a little far. You would have to prove it wasn't true.

[Tyler Machado]

Yes, the aforementioned comment has been removed.

We welcome spirited debate, but please, keep it civil. No personal attacks.

[webber]

"9) Webber wants to know "So, where are these projects in the regulatory/permitting process?" You mean the projects that "Nobody's building ... in Vermont?" Try reading the papers. It's their job, not mine, to keep you informed."

Translation: Greenberg can't point to any baseload projects that are anywhere near the building stage. Because there are none.

"10) Perhaps Webber can tell us exactly how he arrived at these 3 conclusions: "we need about 300-400 MWs of baseload power at about $.06 per". The 3 separate conclusions are 1) the amount of power (300-400 MW) 2) the notion that it needs to be "baseload power" and 3) the price."

Duh, because that's how much baseload power we are now getting from VY, at that price. Are you arguing that we DON'T need baseload power? I assume you know what baseload power is? And are you arguing that it doesn't need to be at an affordable price?

Vermont should NOT shoot itself in the foot and turn off an available baseload power source so that it can buy short-term contract and spot market electricity produced by out of state, non-taxpaying, non-benefit providing coal and oil fired power plants. Especially, if VY is going to continue operating and all we do is host it without getting any of its power. STUPID, STUPID, STUPID.

You want to pay more for electricity? Volunteer to pay more YOURSELF. LEAVE MY DAMN ELECTRICITY SUPPLY AND MY BILL ALONE.

[John Greenberg]

As I anticipated, Webber has no idea what he's talking about. Let's start here: "Duh, because that's how much baseload power we are now getting from VY, at that price." Currently, VY buys 265 MW from VY, not 300-400 MW, at a price, this year, of 4.4 cents per kwh. Next year through the end of the operating license, assuming the plant continues to operate that long, the price will be 4.5 cents.

The current contract ends when the operating license expires in March, 2012. The next day, the current offer from VY is to supply 115 MW to VT utilities at 6.1 cents per kwh (with an annual price escalator).

In other words, whether or not VY runs after its current license expires, VT utilities will be purchasing 150 MW of the power they are currently buying from VY from other sources. So we're talking about replacing 115 MW, not 300-400 MW.

Second, Webber asks: "Are you arguing that we DON'T need baseload power?" If, by baseload power, Webber means power generated 24 hours a day 7 days a week by one source, the answer is yes: that is precisely what I'm arguing.

The whole point of having a power GRID is, in effect, to relieve each utility of the burden of having to provide power at all times, by sharing the burden. This opens up all kinds of possibilities.

Allow me to construct a scenario out of whole cloth -- before anyone accuses me, this is a FANTASY -- to make this clear. If generator A had a plant which operated most efficiently at night, say, and generator B had one which operated best during the day, then as long as the 24 hour demand were met, neither would have to operate their plants at anything but the most efficient times. Obviously, in the real world, it doesn't work quite so simply.

In the real world, the grid operator receives bids on an ongoing basis from all the operators in the system, and chooses from those bids the cheapest suppliers of electricity to meet the demand at any given time (in 5 minute segments), while at the same time, retaining sufficient running reserves to keep the system powered under all contingencies. In other words, while my fantasy-example oversimplifies the reality, it gets to the essence of it, which is that the grid operator maintains power on the grid at the lowest price on a 24-7 basis, REGARDLESS of where the actual electrons are coming from at any given moment.

I will certainly grant that ISO-New England, the grid operator, needs to have a certain number of baseload generators on board to fulfill this function in the world as it is now. (Technological advances in electricity storage, for example, may well change this picture in the not so distant future). But ISO's needs are already more than met by existing generators in New England. To the extent that ISO foresees any problem, it is with the region's transmission system, not any lack of generation.

By being part of the ISO grid system, VT utilities are in large part relieved of the obligation of providing 24-7 power from a very small number of local sources. The existence of the grid is pure Adam Smith division of labor at its finest: by allowing each operator to do what it does best, the system as a whole functions most efficiently.

All this means that, when VY retires, it is simply NOT the case that VT utilities must replace it with baseload generation.

As to the price, I have repeatedly noted that the VY offer currently on the table appears now to be slightly above the expected market price for power, and that, for the next several years (for which there have been ISO auctions) there is a significant overhang of power in New England (ca 8,000 MW). This, in turn, means that if all else were to have failed (and it already hasn't, thanks to the contracts already signed by VT utilities), the power currently bought from VY could be replaced by market purchases on a 24/7 basis at a lower price than VY is offering.

Accordingly, I've also just responded to this: "You want to pay more for electricity? Volunteer to pay more YOURSELF." Look in the mirror Webber, and spare me the "duhs."

Webber characterizes New England market based electricity as coming from "coal and oil fired power plants." Actually, less than 1/4 of New England power comes from these sources. The rest comes from nuclear and natural gas (roughly 70% combined), hydro, etc. Energy efficiency (demand side management) is also becoming an important source for New England, and will continue to grow, thanks to major federal infusions of capital and numerous state programs.

All that said, however, I agree with Webber that "Vermont should NOT ... buy short-term contract and spot market electricity produced by out of state, non-taxpaying, non-benefit providing ... power plants."

While I have just pointed out that this solution IS feasible and economic for ratepayers, it clearly is less beneficial to the overall state economy than a variety of other plans. The plan I've proposed, for example, is to sharply increase efficiency programs which provide the lowest cost "power" and to use some of the rate savings from that effort to offset slightly higher than market in-state renewables projects. But there are MANY other alternatives available.

In any case, while the rest of us are arguing about alternatives, the utilities are actually implementing theirs, thus changing the facts on the ground. The bulk of this power HAS been replaced, whether Webber and I like the solutions chosen or not.

[Jcarter]

JOHN,

"the current offer from VY is to supply 115 MW to VT utilities at 6.1 cents per kwh (with an annual price escalator).

In other words, whether or not VY runs after its current license expires, VT utilities will be purchasing 150 MW of the power they are currently buying from VY from other sources. So we're talking about replacing 115 MW"

Lets stop debating points that are unfactual. Offers are not contracts. Trying to guess causes a lot of back and forth that is essentially pointless. I think you provide a good opposing viewpoint from myself and Webber, but much of the back and forth is lost on unfactual projections.

"I will certainly grant that ISO-New England, the grid operator, needs to have a certain number of baseload generators on board to fulfill this function in the world as it is now. (Technological advances in electricity storage, for example, may well change this picture in the not so distant future). But ISO's needs are already more than met by existing generators in New England."

Why then John did ISO release a report that stated without Vermont Yankee reliability of the grid would be increased and I believe they said severe.

You are putting a lot faith in the "grid" and utilizing spot market energy. This in my opinion is a gamble, something large companies like IBM are going to shudder at.

"In any case, while the rest of us are arguing about alternatives, the utilities are actually implementing theirs, thus changing the facts on the ground. The bulk of this power HAS been replaced,"

John maybe you could provide us with some facts backing this up. I don't believe that all this power has been replaced. Please list the sources you have for this and the amount of energy contacted for. It may end a lot of the arguments.

[Jcarter]

John, after looking much of this up here is what I found :

Currently VT uses 700 MW of power. According to the DOE VT's energy consumption has a 1.5% increase annually.

Currently VT gets

225MW from HQ
270 VY
88 renewables (wind, methane biomass)
80 from instate hydro

This leads to around 45 MW of power being bought on the spot market currently.

In 2012 we will need slightly more power and we will have

225 HQ
88 renewables
80 instate Hydro

For a deficit of 317 MW. Thats what the State needs to find before 2012. Plain and simple. It's irrelvant to what is "planned" or "offered"

There is a projected supply of 95MW from the "planned" projects. If we assume that the lowell wind farm etc etc are built that leaves us with a deficit of 222MW if VY is not relicensed that will need to be bought at spot market prices.

Simply put to be stable in our energy prices Vermont needs VY.

This information is current as of May2010 from a report done by Vermont Energy Partnership.

[webber]

Greenberg concedes that "the grid" needs baseload power. But he wants to push the responsibility for generating any of that baseload power onto other states, so that Vermont can simply buy the baseload power off the grid while other states bear the burden (whatever it may be) of hosting the generators and at the same time get the benefit of sourcing the power.

That is unfair, selfish, unconscionable, and also uneconomical.

For lots of reasons, Vermont should host at least a good poerion of its own baseload power needs, as it currently does with VY -- and reap the economic and reliability benefit of doing so. Forcing other states to host our power supplies is unfair to them, and at the same time puts us at the entire mercy of "the grid" -- both in terms of reliability and price.

We use 700+ MW and we're going to generate 80 MW of that using wind turbines that won't turn half the time, and solar arrays that don't see the sun half the time?

That's both stupid and an economic crime.

We bemoan the loss of manufacturing jobs in the state of Vermont, but now we plan to kick 500 workers onto the unemployment rolls, and put ourselves at the mercy of "the grid."

[John Greenberg]

JCarter and Webber appear to be running out of steam. But they still raise a number of points requiring correction and clarification:

1) JCarter keeps insisting that Entergy's offer is "unfactual." ("Lets stop debating points that are unfactual.") Sorry, but that just won't wash.

In its letter to the Board, Jay Thayer of Entergy wrote: "Entergy Nuclear Vermont Yankee, LLC ("EVY") hereby advises the Public Service Board (the "Board") that it will make, in early January 2010, a unilateral offer to sell power to Green Mountain Power Corporation ("GMP") and Central Vermont Public Service Corporation ("CVPS") ... (Those) negotiations have produced an extensive sharing of data and views but have not produced a new PPA [Power Purchase Agreeement] governing the period following license renewal." This letter was filed on December 18, 2009 -- it's actually misdated 2008 -- not on a whim, but because the Board had set that date as a deadline for presenting the new PPA. The letter serves as the basis for testimony and briefing in Docket 7440.

It's certainly true that "Offers are not contracts." I never suggested otherwise. But the FACTS are what they are: the offer was made; no contract was signed.

So it does not follow that I'm "trying to guess." I've presented the offer for just what it is: Entergy's unilateral description of the best deal it was willing to make at the time, a deal which the utilities were unwilling to accept.

In other words, unlike JCarter, I'm not guessing at anything. More importantly, unlike JCarter, I'm respecting, rather than flying in the face of, the known evidence: namely, that negotiations over a period of years failed to bear fruit.

2) JCarter needs to read more carefully, so I can stop repeating the same points over and over. "Why then John did ISO release a report that stated without Vermont Yankee reliability of the grid would be increased [sic, though that's not what JCarter means] and I believe they said severe." The ISO statement, which I quoted above, says "with OR WITHOUT Vermont Yankee." The statement pertains to transmission problems in Vermont, NOT to power supply. Indeed, it first appeared in a press release about ISO's last capacity auction, in which there were roughly 8,000 MW of excess capacity. Here's the full sentence and the source (note the subtitle): "The studies completed so far have shown that with or without Vermont Yankee, the system in Vermont has reliability issues that must be addressed; without Vermont Yankee in service, those issues are more severe and could affect neighboring areas." ("Final Capacity Auction Results: Surplus Resources Available for 2013–2014," August 30,2010.)

3) JCarter suggests: "You are putting a lot faith in the "grid" and utilizing spot market energy." No, actually, I'm not. I'm just stating the facts as they are: ISO auction data ahows that more than enough grid power will be available and the best evidence suggests that it will come at a price slightly lower than VY offered in the letter quoted above.

On the other hand, I have repeatedly recommended, here and elsewhere, replacing VY power with a combination of sharply increased energy efficiency and in-state renewables. I have also noted that there are quite a number of other alternatives, including grid power purchases, purchases from out-of-state renewable generators, etc. The utilities appear to be using all of these.

4) JCarter asks me to back up my statement that the utilities have been replacing the power. There have been quite a number of announcements, mostly small, and I regret to say that I have not kept a running tally. I will note this large one, however, which appears to have been overlooked by JCarter and Webber: on Feb. 17, 2010, the utilities announced contracts for up to 100 MW of power. There were articles in the Rutland Herald and Burlington Free Press, and perhaps elsewhere as well. If JCarter wishes, he or she can spend the time to try to tally up all the contract announcements, existing contracts, efficiency grants (which will replace the need for power) so forth. I know of no easy way to do this, and do not intend to try; it would be a time consuming task.

Three further points are also worth noting in this context.

First, officials from Vermont's utilities, VELCO, and ISO-New England have all stated repeatedly and testified, to the legislature that there would be no power crisis if VY shuts down at the end of its current license.

Second, while the Douglas administration strongly supported continued operation of VY, its own Department of Public Service concurred, and, in fact, argued to the Public Service Board that in the absence of a good power contract, VY should NOT receive a Certificate of Public Good. That remains the Department's legal stance today. Since the Department's job is to represent the public interest in all proceedings, and since power shortages or overpriced power would hardly be in the public interest, this is a pretty relevant fact at this stage of this debate.

Third, VY proponents, including JCarter and Webber, hammer away at the fact that VY will close next year, unless its license is renewed and a CPG is granted, implying that the sky will fall if all the power is not replaced in the best way possible before that happens. But, if necessary, solutions can be adopted for a transition year or two and need not be long-term solutions. If, thanks to slow permitting in this state, planned renewables projects take another several years to come on line, the lights will not go out as a consequence. Instead, one or another short-term solution will be adopted. Some of these might involve carbon emissions for a few years, which is unfortunate. Officials could have done a better job of planning for this, but they did what they did and we are where we are. It's important to adopt the best long-term strategies possible (my cards are on the table), even if they entail some short-term downsides. But it's also important to recognize that there simply is NO crisis here, if VY shuts down at or before the expiration of its current license. The lights will stay on, and the impact on rates is likely to be exceedingly small (and perhaps, positive).

4) Despite what JCarter reports that the DOE and/or VEP have to say, Vermont's demand has not been increasing in the past few years. See, e,g, http://www.iso-ne.com/markets/hstdata/znl_info/monthly/index.html and compare 2003 to 2010.

In fact, since the beginning of the recession in 2008, demand has dropped in VT. Before that, it is my understanding, based on information from EEV, DPS, and other sources, that demand was being held more or less steady by Energy Efficiency Vermont's efforts in the preceding few years. Indeed, in a DPS document presented for study groups a few years ago, there's a chart showing that VT's electrical demand peaked in the 1970s.

5) Webber calls it "unfair, selfish, unconscionable, and also uneconomical" to buy baseload power from out of state producers, later calling it "stupid and an economic crime." That's a lot of heavy breathing.

I assume he or she doesn't drive a car burning gas or diesel, drink coffee, tea, or cocoa, eat bananas, oranges, grapefruit, lemons, etc., or indeed buy any other products from outside Vermont's borders, since all such purchases would qualify for the same vilification, and I'd hate to think that poor Webber would qualify for these hyperbolic descriptions.

But maybe that's why most Vermonters would not agree with this completely fatuous evaluation of how Vermont's economy should work.

With these points out of the way, let me say that I am not, and don't purport to be, a power planner, but from what I've observed by talking to CVPS and GMP planners and participating more broadly in this debate for several years, there are a variety of considerations that need to be played off against one another: price to ratepayers, effects on the broader economy, impact on the environment, portfolio diversification considerations, and quite a few more.

The only point at which all these considerations converge is energy efficiency: it is, by far, the cheapest "power" source, with the least impact on the environment; it creates substantial numbers of jobs (about 3 times more per MW than VY) and creates none of the kinds of risks which require diversification. Yet while Vermont is considered a leader in the field, studies still show that 20% of our power is wasted. That's precisely why I keep mentioning it at every opportunity, as I have repeatedly above.

In any case, as I have noted previously, the actual decisions as to how to replace Vermont Yankee are being made every day by the utilities. Until and unless we change the regulatory structure of the state, that will continue to be the case going forward. In short, for better or worse, these decisions are actually in the hands of the utilities, not ours.

[webber]

"I assume he or she doesn't drive a car burning gas or diesel, drink coffee, tea, or cocoa, eat bananas, oranges, grapefruit, lemons, etc., or indeed buy any other products from outside Vermont's borders . . ."

You simpleton. Interstate and international commerce is good. Energy dependence is not.

And talk about hypocrite, I'll bet your one of these activists against the international trade treaties, like NAFTA, while at the same time apparently arguing that VT should just happily trade its milk for someone else's electricity.

Feel free to put up all the frickin' wind turbines the PSB will let you put up (that is, if you can get past your "environmental" NIMBYist friends' opposition to them), but keep your politically correct hands off my cheap, baseload, reliable, non-carbon emitting, VT jobs producing, VT tax revenue producing, clean energy development fund supplying, power plant in Vernon, got it?

[John Greenberg]

"Interstate and international commerce is good. Energy dependence is not." Unless, of course, it's Webber's car, in which case, it's fine.

Yeah, I got it.

And by the way, your "power plant in Vernon" is NOT non-carbon emitting. Carbon was emitted in constructing it. Carbon was emitted in mining the uranium, milling it, fabricating it into fuel and transporting it. Carbon will be emitted when the plant is decommissioned, and when the waste -- both "high-level" and "low-level" is transported to a disposal site and disposed of. But why let any facts get in the way of a good rant.

P.S. For the record, I have not oppose international trade treaties and I do have a windmill which the PSB let me put up.

[John Greenberg]

That should have been "I have not opposed." Sorry.

[Jcarter]

John,

I am trying to enter into a debate with you. If you care to please lets try to go point for point. Your long rants make it difficult to sort through. Pick a single point and lets go from there.

Let's start with energy needs : The data from DOE

(http://apps1.eere.energy.gov/states/energy_summary.cfm/state=VT)

shoes the trend in energy from 1986 to 2005. While I concede that since 2005 our energy demands may have decreased between that period that has been an slight increase. Even if energy consumption does decrease we are still at a net negative with VY and are nearly 300MW in the hole with out it as outlined above.

Do you dispute this point and/or the numbers. Please provide a source if you do.

[webber]

Ah, yes. The usual last-resort rationale that VY is not carbon free because the plant had to be built, etc., nonsense. Under that sophistry, nothing is carbon free, including your wind turbine and all the biomass plants, wind turbines, solar arrays, and hydro dams you want to talk about. Harvesting trees and shredding them and trucking them to McNeil produces more carbon per megawatt than VY does. Insulating homes also emits carbon. But after being built almost 40 years ago, virtually every megawatt from VY has been carbon-free, as opposed to BOTH the fueling of and the operation of the coal and oil and gas fired plants that you will force us to rely on.

Stop the desperate argumentation.