Federal Judge Denies Request for Preliminary Injunction by Entergy Corp.

On Monday, July 18th, a federal judge denied a request for preliminary injunction by Entergy Corp., the owners of the Vermont Yankee nuclear plant, asking the court to prevent the state from taking any action that would force the plant to shut down in 2012.  Vermont Yankee is a 40-year old 605 MW nuclear reactor located in Vermont.

In his order, Judge J. Garvan determined that no injunction was necessary because the trial is expected to begin by mid-September.  Judge Garvan also found that Entergy “failed to show any irreparable harm it may incur between now and a decision on the merits” of the underlying lawsuit.  Interestingly, Judge Garvan did not reach a finding on whether the Entergy Corp. was likely to succeed on the merits – which is the second prong required for granting a preliminary injunction.  During hearings on the motion in late June, Entergy Corp. stated that it needed a decision prior to July 23rd because it would need to spend approximately $60 million for fuel required to operate the plant.  If it did not have certainty, Entergy Corp. claimed that it might be forced to shut down rather than risk the fuel expense.  It is unclear what Entergy Corp. will do in light of Judge Garvan’s decision on Monday.

Entergy Corp.’s underlying lawsuit, filed in U.S. District Court in April 2011, challenges the state’s oversight authority, claiming that the federal government preempts the state from taking action to shut the plant down in March, 2012 – the end date of Vermont Yankees original operating license.  The U.S. Nuclear Regulatory Commission (NRC) in March 2011, granted a 20 year extension to 2032 of plant’s operating license.  Vermont state law, however, requires that any electrical generator in the state get a state “certificate of public good” in order to operate.  The state has refused to grant an extension of the plant’s existing certificate, which is due to expire in March 2012.  The state voted 26-4 last year to prevent the Vermont Public Service Board from acting on Entergy’s request for extension of the certificate, consistent with the NRC’s extension of the plant’s operating license.

Entergy’s motion for preliminary injunction relied primarily on the federal preemption of state oversight argument.  Entergy also pointed to the negative impacts it believes the state’s actions have already had – including loss of highly trained plant employees, and will have in the future if the state is successful – including a less reliable power grid, an increase in greenhouse gas emissions and a loss of both state tax revenues and jobs.  In contrast, Entergy claimed that keeping the plant open will impose no costs to the public.

A pre-trial conference will be held on Tuesday, July 26, 2011, to determine scheduling and discovery issues.  Again, the trial is expected to begin in mid-September.

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