Entergy Nuclear Vermont Yankee, LLC v. Gov. Shumlin

Aug 14: In the U.S. Court of Appeals, Second Circuit, Case No. 12-707. Appealed from U.S. District Court for the District of Vermont. A summary indicates that the owners of the nuclear power plant brought action against officials of the State of Vermont, seeking a declaratory judgment and permanent injunction that three Vermont statutes are preempted by the Atomic Energy Act, and that Vermont's efforts to require a below-market power purchase agreement is preempted by the Federal Power Act and violates the dormant Commerce Clause. Following a bench trial, the United States District Court for the District of Vermont ruled in plaintiffs' favor on the Atomic Energy Act preemption claim and the dormant Commerce Clause claim, and found that the Federal Power Act preemption claim was not ripe. The Appeals Court affirmed We the district court as to the Atomic Energy Act and Federal Power Act preemption claims, and reversed the district court as to the dormant Commerce Clause claim. One Judge issued a separate and "reluctantly" concurring opinion.

 

    Without getting into the complete details, at the heart of the litigation are two relatively new Vermont laws which would have limited or prohibited the continued operation of the Vermont Yankee nuclear power plant. Act 74, which was enacted on June 21, 2005, had two principal effects. First, Entergy would only need to seek a "certificate of public good" (CPG) from the Board before constructing storage facilities for new spent nuclear fuel, rather than the Vermont Legislature as had been required by section 6501(a). However, the CPG would remain in effect only until March 21, 2012. The second effect of Act 7 74 was that after March 21, 2012, the storage of any new spent nuclear fuel in Vermont would require an affirmative vote by the Vermont Legislature. If no such affirmative vote occurred, storage of nuclear waste generated from operations after March 21, 2012, would not be permitted. Thus, Vermont Yankee would have to shut down. Act 160 was passed on May 18, 2006, and provides that "a nuclear energy generating plant may be operated in Vermont only with the explicit approval of the General Assembly."

 

    In its conclusion the Appeals Court said, ". . .we affirm the district court's grant of a declaratory judgment that Act 74 and Act 160 are facially preempted by the Atomic Energy Act. We reverse the district court's determination that Vermont's efforts to condition a new Certificate of Public Good for Vermont Yankee on the execution of a favorable power purchase agreement violate the dormant Commerce Clause. We affirm the district court's determination that Entergy's challenge under the Federal Power Act is unripe. We affirm the district court's grant of a permanent injunction enjoining the defendants from enforcing sections 6522(c)(2) or 6522(c)(4) in title 10 of the Vermont Statutes, as enacted by Act 74, or sections 248(e)(2), 248(m), or 254 in title 30 of the Vermont Statutes, as enacted by Act 160. Finally, we vacate the district court's permanent injunction enjoining the defendants from conditioning the issuance of a Certificate of Public Good on the execution of a below-wholesale-market power purchase agreement between Entergy and Vermont utilities or otherwise requiring Vermont Yankee to sell power to Vermont utilities at preferential rates."

 

    Judge Susan Carney issued a separate concurring opinion stating in part, "I concur, reluctantly, in the majority's detailed and carefully reasoned opinion striking down Vermont Acts 74 and 160. My reluctance stems not from any flaw in the majority's analysis, but rather from my concern that Congress, in enacting the Atomic Energy Act (AEA), did not intend the result we reach. Rather, we are led to our conclusion principally by an expansive gloss on the preemptive scope of the AEA first set forth in Pacific Gas & Electric Co. v. State Energy Resources Conservation & Development Commission, 461 U.S. 190 (1983) (Pacific Gas). There, the Supreme Court instructed that '[a] state moratorium on nuclear construction grounded in safety concerns falls squarely within the prohibited field' and would therefore be preempted. Id. at 213 (emphasis added)."

 

    Access the complete opinion and concurrence (click here). [#Energy/Nuclear, #CA2]