Vermont Yankee is shutting down. The nuclear power plant in Vernon will close by the end of next year. Officials from Entergy, which owns Vermont Yankee, made the surprise announcement Tuesday morning.
Entergy and the state of Vermont have been battling for years over the plant. But in Tuesday's announcement, Entergy officials said the plant's closure has nothing to do with those legal battles and everything to do with finances.
"It's going to have a negative economic impact," Bob Woodworth said.
Woodworth worries about his sporting goods store, Burrows Specialized Sports, and neighboring Brattleboro businesses given the news from one of the region's largest employers.
"The Windham County economy is not at the top of the state right now and there's definitely a concern," Woodworth said.
"This was an agonizing decision," said Bill Mohl of Entergy.
Tuesday, executives from Entergy announced at Vermont Yankee's headquarters in Brattleboro plans to close the nuclear power plant a few miles down the road in Vernon. Entergy will shut down the plant by the end of next year.
"Let me be very clear on one thing-- this decision was based on economics of the plant," Mohl said.
Entergy officials gave three main reasons for the closure: strong competition from low natural gas prices, the high cost to operate the plant and what the company calls "energy market flaws" artificially deflating energy prices.
"Vermont Yankee has an immensely talented, dedicated and loyal workforce and a solid base of support among many in the community. We recognize that closing the plant was not the outcome they had hoped for," Mohl said.
Vermont Yankee first opened in 1972. More than 40 years later it employs about 650 people and is 60 percent of Vernon's tax base.
"There's also $5 million that goes to the school for the education fund. So, that's a $5 million cut," said Patty O'Donnell, the chair of the Vernon select board.
A bitter battle with the state began in 2010 over its continued operation. Lawmakers initially expressed concerns about the plant's safety, age, and misstatements by plant officials.
O'Donnell, who is also a former Republican representative, says Gov. Peter Shumlin's push to close the plant will now hit families in their wallets.
"My message to Governor Peter Shumlin is that we all need to work. We are not all millionaires and can't go to the banks to pay our taxes, pay our medical bills or buy our groceries. I think the state needs to become more business friendly," O'Donnell said.
But opponents of Vermont Yankee say this is the day they've been waiting for-- the day Vermont Yankee finally does the right thing.
"I am happy for the news that Vermont Yankee will be closing," said Leo Schiff of the Safe and Green Campaign. "But 14 to 16 months isn't soon enough."
So, now the focus shifts to decommissioning. Yankee officials say they plan to place the plant into what's called SAFSTOR. That seals the plant off rather than dismantling it. Plant officials say that could take decades and the exact plans for decommissioning are still being worked out.
SAFSTOR is not what anti-nuclear groups were hoping for. They would rather see full decommissioning and dismantling. That would also provide many more jobs than just the SAFSTOR move. What is clear-- the fight over Vt. Yankee will take many more years.
ECONOMIC IMPACT ON THE REGION
The loss of jobs at the Vernon plant will have an impact on the entire region.
Economist Art Woolf, an associate professor of economics at the University of Vermont, spoke with our Keith McGilvery.
"A lot of people up here don't realize how important it is for the southeastern Vermont economy. There's about 600 jobs there and the average salary is about $100,000. So, probably in terms of large firms in Vermont, it's probably got the highest average salary of any business in the whole state," Woolf said. "Southern Vermont's economy is already not doing well; this is just going to be some more bad news for it. This is much worse proportionately for the Brattleboro area than the recent layoffs at IBM were for the Chittenden County area."
Gov. Maggie Hassan, D-New Hampshire, announced that she and her staff are working with Vermont officials to help displaced workers find jobs and maintain safety at the plant.
REACTION TO THE CLOSING OF VERMONT YANKEE
Gov. Peter Shumlin, Vermont Attorney General Bill Sorrell and legislative leaders have been trying to close Vermont Yankee for years. They welcomed the news Tuesday.
From the governor down to many other political observers, the writing on the wall for the closure of the plant has been in the works for some time.
"This is good news for Vermont and Entergy has made the right decision to shutter this old and aging plant," said Gov. Peter Shumlin, D-Vermont.
Gov. Shumlin-- flanked by cabinet member and lawmakers-- said the early morning phone call he received from Entergy officials was not entirely a surprise given the current economic conditions in the industry. He says foremost on his mind are the 650 Entergy employees-- 260 of them Vermonters.
"My first concern as governor is to ensure that we view this as a base closing in other parts of the country, but as an opportunity to grow jobs and economic opportunities for those who are being impacted," Shumlin said.
Rep. Tony Klein, D-East Montpelier, chairs the House Committee on Natural Resources and Energy. Klein has doggedly pursued closing Yankee from the start of his political career. But like the governor, he also emphasized what he calls an important point.
"This plant is not closing because of anything the state of Vermont has done. This is clearly the economics and the sign of the times of big baseload generators, the price of natural gas," Klein said.
Klein says his primary concern now is the inadequate amount of money in the plant's decommissioning fund-- some $560 million-- and whether Entergy lives up to long-term agreements to fully restore the site.
"We don't want to see that thing sitting there as is for 70 or 80 years. We want that site brought back to productive positive uses as quickly as possible," Klein said.
Environmental groups that have fought the plant at every turn welcomed the news.
"This is great news for Vermont," said Sandy Levine of the Vermont Conservation Law Foundation. "Vermont Yankee has not been a good deal for Vermont for some time now. It's not been economic. The plant has not been making any money. This is a tired old nuclear plant and its time has come."
Yankee supporters say the plant's legacy is positive and its closure premature.
"It did a good job for the ratepayers and businesses and the economy and the environment for the state of Vermont," said Guy Page of the Vermont Energy Partnership.
Page says that even if the plant no longer sells power to local utilities, it affects the New England power market as a whole.
"When the plant finally goes offline, they will have to be buying presumably more natural gas, coal-based power. So for our air quality and the diversity of the region's power portfolio, it's going to make it tougher," Page said.
ISO New England, which manages the power grid, says a recent study found the power grid will be fine without Yankee, but they do say it will be mean a greater reliance on natural gas-fired power.
A BITTER LEGAL BATTLE
It has been a controversial four decades for the Vermont Yankee nuclear plant.
Following battles waged in the courtroom and in the court of public opinion, Vermont may have won its war of attrition with Entergy Louisiana.
Conflict stemming from debate over the pros and cons of nuclear power in Vermont began as soon as the plant opened four decades ago. Over the last couple of years, the debate has played out in court.
"They do not care about Vermonters; they care about their bottom line. They care about running an old, aging plant beyond its designed life," then-Sen. Peter Shumlin said in April 2011.
The state and the company engaged in a series of lawsuits beginning in April 2011 after legislators-- led by then-Senator Peter Shumlin-- voted to close the facility a year earlier.
So far, the courts sided with Entergy ruling largely in its favor four different times, with the most recent decision coming two weeks ago.
Federal law trumps state and leaves all safety regulation to the Nuclear Regulatory Commission.
Vermont legislators argued they wrote laws forcing the expiration of the facility's certificate of public good because of business and environmental concerns.
"Even though they tried to couch their language, even though they tried not to talk about safety concerns, the court found that was really their primary motivation. Because of that, what they did was unconstitutional," legal expert Cheryl Hanna explained Aug. 14.
The facility once supplied 30 percent of the state's power, but now all of the electricity flows to out-of-state customers.
By 2014, power will be cut entirely, but federal oversight will continue as the plant is decommissioned over the next 60 years.
Entergy's pending case before the Public Service Board seeking an extension of its Vermont license to operate has not been pulled. Either side can petition to remove the matter from the board's docket.