By Nate Raymond
NEW YORK Aug 14 A federal appeals court on
Wednesday largely sided with Entergy Corp in its fight
to prevent Vermont from shutting down the only nuclear power
plant in the state.
The ruling by the 2nd U.S. Circuit Court of Appeals upheld
the bulk of a decision last year finding two laws the state
enacted related to the 620-megawatt Vermont Yankee plant were
trumped by the federal Atomic Energy Act.
The New York-based appeals court did, however, vacate an
injunction preventing Vermont from requiring Entergy to execute
an agreement requiring it to offer power at favorable rates in
order to get a new certificate for the plant to continue
The case has been closely monitored as a test of the ability
of states to regulate nuclear power utilities, particularly
after heightened safety concerns following the Fukushima
disaster in Japan in 2011.
Governor Peter Shumlin reaffirmed his opposition to the
nuclear plant, saying it is "not in the best interest of
Vermont," and indicated that the final chapter has not been
"While I disagree with the result the 2nd Circuit reached in
preempting Vermont's Legislature, the process does not end
today," Shumlin, a Democrat, said in a statement.
Spokeswomen for Shumlin and the state's attorney general had
no immediate responses when asked if Vermont would pursue
further appeals, including to the U.S. Supreme Court.
Entergy had contended that the 1954 federal Atomic Energy
Act vested the U.S. Nuclear Regulatory Commission with sole
authority over radiological safety, leaving states to only
regulate the need for power.
In its ruling on Wednesday, the appeals court said that the
Vermont legislation at issue in the case was motivated by
"impermissible concerns" about radiological safety.
The plant, which Entergy bought in 2002, has been the focus
of years of political controversy over its operations.
The most recent fight followed Entergy's disclosure in
January 2010 of a leak of radioactive tritium at the plant.
At the time, the Vermont Senate had been considering a law
to authorize the plant's continued operation for another 20
years. That legislation failed to pass, despite the NRC's own
approval of a new 20-year license for Vermont Yankee.
The failure of the legislation followed passage of two laws
in 2003 and 2006 that became the center of the appeal.
The 2003 law, called Act 74, required an affirmative vote
after March 2012 by the state's legislature for the storage of
nuclear waste. If the vote was no, the plant would have to
The 2006 law, Act 160, required the state legislature's
approval for the plant's continued operation.
Entergy went to court in April 2011. In January 2012, U.S.
District Judge J. Garvan Murtha in Vermont ruled in favor of
Entergy and blocked Vermont from forcing the company to shut the
In its ruling Wednesday, the 2nd Circuit cited debate in the
Vermont legislature about radiological safety in its finding
that the 2003 and 2006 laws were motivated by "impermissible
concerns" about radiological safety.
"We conclude that the district court carefully, fairly, and
properly analyzed the legislative intent undergirding Act 160
and found that it demonstrated an impermissible primary purpose
on the part of the Vermont Legislature," U.S. Circuit Judge
Christopher Droney wrote.
Terry Young, a spokesman for Entergy, said the company had
long felt the 2003 and 2006 laws were preempted by federal law
"are very pleased with today's decision."
On the portion of Murtha's ruling the 2nd Circuit reversed,
the appeals court said the trial judge erred in issuing an
injunction based on the mere intent of Vermont to seek a
favorable power purchase agreement.
But Droney emphasized the court was not suggesting that any
such agreement would not violate the U.S. Constitution's
Commerce Clause by requiring more favorable rates for in-state
rather than out-of-state utilities.
Shumlin in his statement noted that the Vermont Public
Service Board continues to review Entergy's request for a state
certificate of public good.
"Our state's energy future should be charted by Vermonters,
and I am committed to increasing Vermont's reliance on
renewable, sustainable and responsibly managed sources of
energy," he said.
Shares of Entergy were up 11 cents at $65.82 on the New York
Stock Exchange near midday.
The case is Entergy Nuclear Vermont Yankee, LLC et al v.
Shumlin et al, 2nd U.S. Circuit Court of Appeals, 12-707.