• Casting a shadow
    February 23,2012

    The decision by the Shumlin administration to increase water discharge fees paid by the Vermont Yankee nuclear power plant by 417 percent appears punitive and vindictive. There is a case to be made that lifting the cap on fees would be fair, but in the context of the long-standing battle against Yankee by Gov. Peter Shumlin, there is reason to fear that fairness is being sacrificed.

    Vermont Yankee pays a fee for discharging heated water into the Connecticut River. It uses about 543 million gallons a year as a coolant and pays a per-gallon fee. Yankee’s payments are limited, however, because of a cap of $105,000. Yankee is the only company in the state whose discharges are large enough to hit the cap, and the Shumlin administration is proposing to lift the cap, which would raise the company’s fees to $543,000.

    Fees are supposed to cover the cost of regulation and are not meant as a source of revenue for the General Fund. Yet the Agency of Natural Resources has suffered serious budget cuts in recent years, and higher fees from Vermont Yankee could help pay for a better computer system for the Department of Environmental Conservation, which would free up staff to handle the extensive regulatory duties required to oversee Vermont Yankee. At least, that is the thinking at the department.

    But the proposed elimination of the cap and the higher fees come in the context of a protracted legal battle between Entergy Corp., the owner of Vermont Yankee, and the state of Vermont. U.S. District Judge J. Garvan Murtha has rejected Vermont laws granting the Legislature authority to block the relicensing of Vermont Yankee, whose certificate of public good is due to expire next month. Thus, according to Murtha’s ruling, a vote in the Vermont Senate against relicensing the plant had no legal standing. Entergy has received approval for continued operation from the federal Nuclear Regulatory Commission, and so continued operation after March is expected.

    Attorney General William Sorrell announced last week he would appeal Murtha’s ruling to the U.S. Court of Appeals. The issue is whether federal law granting the NRC authority over nuclear safety issues pre-empts the Vermont laws granting the Legislature the power to decide Yankee’s future.

    The Shumlin administration has now waded into this intensifying battle by proposing to extract an extra $438,000 annually from the company. One way to view the issue is that, because Yankee is the only company large enough to benefit by hitting the cap, eliminating the cap means doing away with a loophole that gave the company a special benefit enjoyed by no one else. It’s a reasonable line of thinking. It would be another step toward curtailing costly corporate welfare.

    But Patrick Parenteau, professor at Vermont Law School and a specialist in environmental affairs, sounded a cautionary note. He said the higher fees were probably constitutional and would probably not trigger a lawsuit from Vermont Yankee. But he said it was not a good idea to pass laws targeting Vermont Yankee in “bad faith” during the state’s legal battle with the company.

    Shumlin has not been shy about criticizing the company, and sometimes his rhetoric has gotten away from him. He is no longer a senator from Windham County, but governor of the state, and it is important that he behave in a statesmanlike and objective fashion, and not be seen as acting out of personal vindictiveness. When he vowed not to eat fish from the Connecticut River after a fish contaminated with radioactivity was taken from the river, he was speaking before the evidence was in, and he undermined his own credibility.

    The higher fees on Yankee may be fair. The timing is questionable. There is much still to be resolved about Yankee’s future, both at the level of the federal courts and before the Public Service Board. A punitive fee increase casts a questionable shadow.

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