State Involvement Key for Decommissioning Old Nuclear Plants

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The beginning of 2014 marks the final year of operation for the Vermont Yankee Nuclear Power Plant, ending a contentious battle between the state and the plant’s owner. On December 23, Entergy (NYSE:ETR) and the state of Vermont announced a deal that will end all litigation surrounding the plant’s operation, shut down the plant at the end of 2014, and lead to a compressed schedule to study decommissioning.

The conflict started when Entergy sought a 20-year license renewal to keep the Yankee plant operating into the 2030’s. Vermont, however, requires approval from the state legislature for license renewal, the only state in the country that does so. Yet Entergy sued the state, arguing that authority over nuclear license renewals rests only with the Nuclear Regulatory Commission (or, NRC), and that federal authority trumps state authority.

Although a series of court decisions affirmed Entergy’s position, the company ultimately decided to close the plant anyway, largely due the inability to compete with cheap natural gas. In August 2013, it announced that it would cease operations at the end of 2014.

The single-unit 605-megawatt Vermont Yankee plant accounts for about three-fourths of the state’s electricity generation — the largest share in the country. Vermont also imports a significant quantity of hydroelectric power from Canada. Together nuclear and hydropower allows Vermont to rank lowest in greenhouse gas emissions in the nation.

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