Vermont Nuclear Plant Seeks Decommission But Lacks Funds

mdsolar (1045926) writes with this bit of news about the Vermont Yankee Nuclear Plant shutdown. From the article: "On Friday, the Vermont Public Service Board voted to authorize Entergy Nuclear Operations, Inc., the operators of the Vermont Yankee electricity generating station ..., to close down their nuclear power plant by the end of this year. Because Entergy planned to shut the Vermont nuclear plant down prior to its licensed end-term, the board was required to approve the shutdown....

Entergy has reserved just over $600 million to date for decommissioning the Vermont nuclear plant, according to the Department of Public Service. This amount will not be adequate to meet the costs of full deconstruction, estimated at more than $1 billion according to the company's 2012 Decommissioning Cost Analysis report."

Comments

and yet even more

[polar red]

and yet even more subsidies for the nuclear industry will follow.

Re:and yet even more

[imikem]

Of course. It's so silly that no other industries ever get subsidized by tax dollars.

Re:and yet even more

[jythie]

Well, that is how they stay competitive with all the other subsidized industries.

Re:and yet even more

[ShanghaiBill]

Of course. It's so silly that no other industries ever get subsidized by tax dollars.

It is silly to justify something stupid by pointing out that we also do other stupid things. That is just circular logic that results in a lot of stupidity.

Re:and yet even more

[operagost]

OK, Captain Logical Fallacy-- perhaps we subsidize nuclear power generation for the same reasons we subsidize other forms of power generation. That is the implication.

Re:and yet even more

[ShanghaiBill]

... the same reasons we subsidize other forms of power generation.

The reason is to channel money to politically connected special interests. It is stupid for that to be tolerated in a democracy, but the beneficiaries are concentrated, while the victims are diffuse, so it happens. Voters can often be conned into believing that these subsidies are in their own interests (hey, cheaper power!) without realizing that the taxes they pay to finance the subsidies far exceed the savings on their utility bills.

But I thought nuclear power was cheap

[Anonymous Coward]

This issue demonstrates that arguments about the low lifetime cost and impacts of nuclear power tend to externalize significant costs. Decommissioning can be added to waste handling/storage and subsidized insurance.

Re:But I thought nuclear power was cheap

[bobbied]

This issue demonstrates that arguments about the low lifetime cost and impacts of nuclear power tend to externalize significant costs. Decommissioning can be added to waste handling/storage and subsidized insurance.

Partly true, but the real problem is that though out the lifetime of this plant, the expected costs for decommissioning have gone though the roof by a mass of changing rules, laws and policies which have conspired to not only raise the costs but shorten the useful lifespan of the plant. As such, this is not really the operator's fault, but the cold economic facts of changing political climate are really to blame. IMHO...

Re:But I thought nuclear power was cheap

[Mr D from 63]

Not to mention being shut down earlier than planned due to a vitriolic political environment coupled with the price pressure of shale gas and excessive subsidization of renewables.

For those that speak of nuclear subsidies...on a $ per KWh generated basis, nuclear subsidies are nowhere close to other energy technologies.

Re:But I thought nuclear power was cheap

[mellon]

Um. The plant was originally licensed to operate for 40 years. It is falling apart. Literally: a few years back one of the cooling towers collapsed. Buried pipes are leaking, and nobody knows where the pipes are or where the leaks are. Sources for backup power have dried up because the providers don't want to be held liable in the event of an accident. The idea of extending its operating permit for another 20 years was incredibly irresponsible. The State of Vermont refused to certify its continued operation, but the courts overrode the state.

It is bloody unfortunate that the low cost of shale oil is what finally did the plant in, but closing it is the right move. The only decent alternative would be an extremely costly remodel, which would not likely be cheaper than closing it and building a new one with better technology. The alternative Entergy wanted was to keep running it, and damn the safety concerns, because they wouldn't have to pay if it failed catastrophically anyway.

Re:But I thought nuclear power was cheap

[gweihir]

Oh, you mean they cannot just throw the highly poisonous nuclear waste into the sea anymore?

Re:But I thought nuclear power was cheap

[Solandri]

The Vermont Yankee plant has been in operation since 1972, and generates about 4700 GWh each year. So over its lifetime it has probably generated about 190,000 GWh of electricity. $1 billion in decommissioning costs works out to about 0.5 cents per kWh (vs an industrial/commercial/residential cost of about 10/14/16 cents per kWh in Vermont). It does not substantially change the lifetime cost of the electricity generated.

All the states I know of require nuclear plant operators to collect these decommissioning costs in a fund. That is, part of their revenue from electricity sales must be placed into a trust fund specifically for decommissioning the plant in the future. That the Yankee plant has insufficient funds despite 41 years of operation suggests accounting fraud, regulatory incompetence, or inflated decommissioning costs more than it does non-viability of nuclear power. The San Onofre nuclear plant operated a similar amount of time, had about 3.6x the generating capacity when it was shut down, and was also shut down prematurely. It has a $2.7 billion decommissioning fund which is expected to exceed the costs, so they are planning to refund the excess to customers.

If you take the profits

[Pop69]

Then you pay the costs associated with them.

If they've failed to properly provide for shutdown and decomissioning costs then it's their problem, they should be forced to pay them rather than pleading poverty and being allowed to walk away from their responsibilities

Re:If you take the profits

[peon_a-z,A-Z,0-9$_ !]

Except in this case the plant was approved for twenty additional years of operation in 2011 and is now being shut down.

Therefore, contrary to your assertion, they were properly planning for the costs but that planning did not encompass irrational public opinion shutting down the plant ahead of schedule.

The people therefore who demanded it be shut down will also be the people who pay the extra costs associated with shutting it down.

Re:If you take the profits

[n1ywb]

Entergy is shutting it down because it's unprofitable. It's purely by choice. The state's efforts to shut it down were thrown out in court.

Re:If you take the profits

[ShanghaiBill]

If they've failed to properly provide for shutdown and decomissioning costs then it's their problem, they should be forced to pay

Who are "they"? The decommissioning charge tacked onto utility bills is set by the public utility commission, which is a government entity. So if the people responsible are held accountable, then "they" are the taxpayers of Vermont who voted in the past to push costs off into the future ... which has now arrived.

Re:If you take the profits

[Bengie]

If it's not one of the newer designs, like thorium, I would also like it shutdown. All nuclear power plants should be using modern negative-feedback self-limiting designs that consume most of their fuel, resulting in relatively short lived radioactive waste.

Re:If you take the profits

[peon_a-z,A-Z,0-9$_ !]

We need to start having "radiation leaks" in terms of units that people can understand, like "bananas."

Would you really care if you were instead told that it was leaking tritium equivalent of "3 bananas per day" into the ground water?

Radiation is a part of life on Earth.

Re:If you take the profits

[bobbied]

But the legal effort to resist the state's efforts cost the utility money as did the public relation campaign.

The real reason here is that electricity rates have dropped do to Natural Gas production and operating/decommissioning costs have risen since the plant was commissioned due to changing regulations. All this as conspired to give us the problem we now have and like it or not, pretty much everybody will be paying for this in some way.

Re:If you take the profits

[gtall]

That and when the coal industries get in bed with local government, then you get the coal ash slurry dumps like what happened in North Carolina. And those coal slurry accidents are not all that rare. And as usual, the locals take it in the neck when it happens.

Re:If you take the profits

[khallow]

What if all companies released 3 bananas worth of radiation into the ground water per day, because there is no penalty?

Nothing would happen. That's the outcome of releasing insignificant amounts of radiation into the environment.

Re:If you take the profits

[AmiMoJo]

Bananas are not good units to use because the potassium they contain is not very dangerous to humans. The body maintains a fairly constant level no matter how many you eat, passing the excess out.

Compare that to what is being released from, say, Fukushima. It bio-accumulates and ends up sitting inside your organs for decades, slowly irradiating them. Although the radiation level is low it is also constant, which is why your risk of getting cancer goes up.

People who use the banana equivalent dose don't seem to understand this rather basic and crucial fact. It's also why you don't hear experts on the subject using it.

that's ok

[jsepeta]

the government (us citizens) always foot the bill for building and decommissioning nuclear plants. why should the actual businesses have to pay their own expenses?

Re:that's ok

[Impy the Impiuos Imp]

You regulate the electricity costs, so your fingerprints are all over it already, "The People".

Re:that's ok

[plopez]

What's needed is a full accounting and transparency. Then and only then will people be able to make good decisions. And the private sector is guilty of cooking books and "selling" things as well, unless fear of regulators or lawsuits causes them to come clean. And that means personal responsibility from the managers who make the decisions.

wait, what?

[Anonymous Coward]

I don't think a single aspect of the summary was accurate. They didn't need approval from Vermont to shutdown, they needed approval to run the plant until the end of the year. And of course they don't have enough money to decommission the plant today - they only made the decision to close the plant about a year ago. The plant needs to continue saving up money in their fund until they have enough to decommission the plant - no surprises there. So what is the point of this story?

Re:wait, what?

[Giant Electronic Bra]

The plant was originally licensed for 20 years and had an expected design lifetime of 40 years, that is 2012. The fund was set up in 1972 and should have been managed such that it would be adequate in 2012 to shut the plant down. Thus the point is quite valid since said funds clearly are short by 40% or so. Entergy tried to extend the lifetime of the plant by another 20 years (and succeeded, they can legal go ahead and run it until 2032 and I believe even do so at a higher power output). They didn't need 'approval to run to the end of the year' except in the sense that there were certain regulatory questions that they needed answers for. If they HAD continued to operate then its possible the State would have continued various legal actions to get them shut down, but they weren't required to do so as of a year ago.

Most appropriate tag line ever

[wayne_t]

The Slashdot quote at the bottom of the page when I scrolled down was:

"Consequences, Schmonsequences, as long as I'm rich." -- "Ali Baba Bunny" [1957, Chuck Jones]

That may be the most relevant one I've ever seen.

Your only source for safe, cheap, nuclear energy:

[Rambo Tribble]

It's still the Sun, providing reliable, local service for over 4 billion years.

Negative subsidy [Re:subsidy]

[Geoffrey.landis]

Neither to the extent, nor in the manner of nuclear. Other industries get tax breaks, free use of government research, etc.

It's worth pointing out that nuclear power actually gets a negative subsidy. They have been charged a fee for nuclear waste disposal... but the nuclear waste disposal program was cancelled, and there is no replacement plan.

The fee was suspended by court order last November... but the money collected has not been refunded.

http://www.nytimes.com/2013/11...

Different power sources have differences

[Geoffrey.landis]

It turns out that natural gas and renewable energy are making a lot of nuclear plants uneconomic.

Not really. Nuclear and renewable cover different portions of the demand curve. Nuclear is good for baseline power-- 24 hours a day. Renewable (other than hydro) tends to be a variable power source. Solar, in particular, is a good source for daytime peaking power, particularly in summer. Valuable-- but a different portion of the demand curve

Natural gas is indeed changing the structure of the electrical power market. One significant reason it's changing it is because gas turbines can vary output rapidly. They're good for load variations, where nuclear is best for baseline.

Different power sources have different characteristics, and serve different segments of the market.

Re:Nuclear gets the biggest subsidy

[mellon]

What would actually happen in this situation is that homeowners would get shafted, just like they always are when government-sponsored corporate welfare goes wrong (e.g., the crash of 2008). So no worries about the government running out of money. As a neighbor to Vermont Yankee, I am keenly aware that if it were to have a serious radiation-releasing accident, I would simply have to walk away from my rather substantial real estate investment. This is why it always pisses me off when people rant about how cheap nuclear is. Of course it's cheap: when you can get local property owners to indemnify you against accidents, you are getting a subsidy, and subsidies are great for the bottom line.

Bogus

[mdsolar]

The waste still needs to be disposed of. It looks like it is going to cost more, not less, so the industry has been undercharged.

Exactly

[Giant Electronic Bra]

Nothing the State of Vermont did caused the plant to be shut down. It was entirely Entergy's own stupidity on multiple levels. First they decided to run as a 'Merchant' plant, refusing to sign a contract to provide VT with power (ironic as it was us who bore the burden of the threat of some disaster, etc). They could have locked in a profitable rate but they were stupid and greedy and screwed themselves. Secondly they were INCOMPETENT, or at least in many instances managed to LOOK incompetent. Parts of the cooling tower fell down, they lied to the regulators about tritium leak issues, etc. Thirdly they failed to do basic good cost accounting, for instance not planning for the replacement of a condenser who's rebuilding was MUCH MUCH more expensive than they 'guessed' it would be.

As for the decommissioning cost thing, this is not some new thing or a bolt out of the blue. The original operators sold the plant to Entergy to get out of these liabilities and Entergy never properly funded the fund. It was a routine matter of discussion in VT TEN YEARS AGO that this day would come. What they did back then was come up with a plan to 'invest' the fund in something-or-other and then decommission in 60 years using the projected proceeds (and then of course get hammered in 2008, like they cared). After that they tried to spin the plant off so they too could escape from the burden of dealing with the twin messes of decommissioning and waste disposal.

Overall Entergy has been rather dishonest and conniving, not to mention a bit less than totally competent at some level. Mark my words, the state will end up getting boned. Everyone will be paying for decades, yet magically "Nuclear power is cheap!" continues to be the mantra. All I can do is roll my eyes.

Re:Bogus

[interkin3tic]

Carbon still needs to be disposed of too, we're just allowing coal plants to pretend it doesn't. Simply because it floats away and negatively impacts everyone across the globe a slight bit, most of whom are in other countries.

In other words, yes, you're right, fossil fuels externalize the costs of waste disposal while nuclear does not. To me, that's an argument in favor of subsidizing nuclear rather than coal: it's a lot easier to deal with nuclear waste that's in one place rather than deal with the effects of carbon in the atmosphere.

Why is this important? Entergy has tne money...

[bobbied]

The owner of Vermont Yankee is Entergy Corp. and they are HUGE.

Looking at their most recent annual report filed in February of 2014. This company made about a billion dollars in profit last year. They might not like having to pony up another 500-600 Million dollars over the next 5 years, but it's not like they couldn't. It would barely be a blip on the radar in the grand scheme of things for them. It's obvious they will easily pay for this and the government won't have to take over.

Tell me again why this is news?

Yep, you pegged it.

[Medievalist]

Well, that is how they stay competitive with all the other subsidized industries.

In theory, the government subsidies are intended to further social goals that the free market cannot adequately address without regulation.

In practice, the government subsidies are treats that the political powers (such as congressmen) hand out to economic powers (such as favored contributors).

Since our economic powers have evolved into multinational corporations that actively oppose our social goals and purposely subvert our cultural values, this means that the government subsidies are quite often doing the exact opposite of what they are nominally intended to do.

Re:Use the 600 million for new reactor

[Giant Electronic Bra]

Gosh yes, and we should just leave this nuclear plant to rust in the middle of a flood plain, you know full of all kinds of fuel. You realize this is a GE MK1, the same as the reactors at Fukushima, with all the same design flaws, the nice spent fuel pool on the top floor, etc. Sorry, cleanup isn't an OPTION, its a necessity.

Re:A lot of nuclear plants are uneconomic

[rahvin112]

Utility scale solar and wind is almost as cheap as coal on a per kw basis and prices continue to fall. With all the cheap gas for the night time energy use (and how ridiculously cheap NG generators are) it's no wonder utilities are running away from nuclear.

Re:Nuclear gets the biggest subsidy

[davester666]

So, you purchased the property prior to the nuclear plant being planned, back in the 60's [it opened in '72]?

Or you were unaware of the plant's presence when you purchased the property?

Or you are still living in your parent's basement?

Re:Nuclear gets the biggest subsidy

[mellon]

Excuuse me? You think some Johnny-come-lately power plant, by virtue of having been here for a mere 42 years, has some kind of special right to continue operating outside its safe lifetime at the risk of all the homeowners in the area, just because some of them arrived after the plant was built? As it happens, I grew up about five miles downstream of the VY site, and was 7 when it started operations. But even if that weren't the case, your logic is offensive. A brief incumbency in the neighborhood does not give a corporation special privileges with respect to imposing its externalities on its neighbors. The natural heritage that exists in the general area of the VY power plant has tremendous value, and should not be placed at risk in the service of short-term expediency.