ML15097A079

Comment (2) by State of Vermont on NRC-2015-0029, Applications and Amendments to Facility Operating Licenses and Combined Licenses Involving No Significant Hazards Considerations

ML15097A079
Person / Time
Site:	Vermont Yankee File:NorthStar Vermont Yankee icon.png
Issue date:	03/19/2015
From:	Landis-Marinello K State of VT, Office of the Attorney General
To:	Rules, Announcements, and Directives Branch
References
80FR8355 00002, NRC-2015-0029
Download: ML15097A079 (128)

Text

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March 19, 2015Status: PendingPost 11ricking No. ljz-8htd-9waw Comments Due: March 19, 2015Submission Type: WebDocket: NRC-2015-0029 R %-- , F'-/Applications and Amendments to Facility Operating Licenses and Combi edI Lcenses Involving No Significant Hazards Considerations Comment On: NRC-2015-0029-0002 Biweekly Notice; Applications and Amendments to Facility Operating Licenses and Combined LicensesInvolving No Significant Hazards Considerations Document:

NRC-2015-0029-DRAFT-0002 Comment on FR Doc # 2015-03162 Submitter Information Name: Kyle Landis-Marinello Submitter's Representative:

Kyle Landis-Marinello Organization:

Vermont Attorney General's OfficeGovernment Agency Type: StateGovernment Agency: State of VermontGeneral CommentSee attached file(s)Attachments Attachment IVTMarch 19_2015_Comments Attachment2_VTExhibitl toMarch_19_2015_Comments Attachment3 VT Exhibit2 to March 19 2015 CommentsSUNSI Review CompleteTemplate

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03/30/2015 UNITED STATES OF AMERICANUCLEAR REGULATORY COMMISSION In the Matter of:Entergy Nuclear Operations, Inc., VermontYankee Nuclear Power Station September 4,2014 License Amendment RequestDocket No. NRC-2015-0029 Docket No. 50-271Comments of the State of VermontSubmitted:

March 19, 2015OFFICE OF THE ATTORNEY GENERALWilliam H. SorrellAttorney GeneralScot L. KlineEnvironmental Protection Division ChiefKyle H. Landis-Marinello Assistant Attorney General109 State StreetMontpelier, Vermont 05609DEPARTMENT OF PUBLIC SERVICEChristopher RecchiaCommissioner Aaron KisickiSpecial CounselAnthony Z. RoismanOf Counsel112 State StreetMontpelier, Vermont 05602 TABLE OF CONTENTSPageIN T R O D U C T IO N ..........................................................................................

1I. License Condition 3(J)(a)(iii) is necessary to assure adequatefunding of decommissioning as needed to protect public health andsafety, particularly in light of indications by Entergy that it intendsto use the NDT Fund to reimburse itself for expenses that do notmeet the NRC's definition of decommissioning

......................................

1II. Entergy has filed an exemption request that is directly related to theLAR, and the State should have an opportunity for a hearing on thedirectly related exemption request .................................................

9III. The LAR should be denied because it has not undergone therequired environmental review and, despite Entergy's claim to thecontrary, the LAR is not categorically excluded from thatrev iew ..........................................................................................

11CO N CLU SIO N .........................................................................................

121 INTRODUCTION The State of Vermont, its citizens, and its ratepayers have a direct interest inensuring proper use of the Nuclear Decommissioning Trust (NDT) Fund for theVermont Yankee Nuclear Power Station (Vermont Yankee) in Vernon, Vermont.The State opposes Entergy's September 4, 2014 License Amendment Request (LAR)(ADAMS Accession No. ML14254A405) because it would: (1) eliminate the 30-daynotice requirement for withdrawals from the NDT Fund; (2) prevent the State ofVermont and interested citizens from commenting on and, when appropriate, opposing unauthorized withdrawals from the NDT Fund; and (3) impair the abilityof the Nuclear Regulatory Commission (NRC) to prohibit potentially improperwithdrawals.

Further, the LAR is directly related to an exemption request thatEntergy filed after the LAR, and, because the two requests are clearly linked, theState should have an opportunity for a hearing on both the LAR and the directlyrelated exemption request.

Finally, the State opposes the LAR because it has notundergone the required environmental review and, despite Entergy's claim to thecontrary, the LAR is not categorically excluded from that review.I. License Condition 3(J)(a)(iii) is necessary to assure adequatefunding of decommissioning as needed to protect public health andsafety, particularly in light of indications by Entergy that it intendsto use the NDT Fund to reimburse itself for expenses that do notmeet the NRC's definition of decommissioning.

As the State explained in its March 6, 2015 comments to the NRC onEntergy's Post-Shutdown Decommissioning Activities Report (PSDAR)-comments that are attached here and expressly incorporated into these Comments-Entergy 1

has failed to provide reasonable assurance that adequate funding will be available for decommissioning.

See Exhibit 1 at 5-39. The State's March 6, 2015 commentsexplain in detail the State's specific concerns with Entergy's decommissioning plans, as expressed in its PSDAR, Decommissioning Cost Estimate, and otherfilings, and why the NRC must act now to ensure that Entergy uses the NDT Fundonly for expenses that meet the NRC's definition of decommissioning.

Yet Entergy has asked for precisely the opposite-that the NRC takeaffirmative actions through this LAR that would eliminate one of the main tools theNRC currently has to ensure Entergy's compliance with applicable NRC regulations governing the proper use of NDT Funds. License Condition 3(J)(a)(iii) is two-fold.

First, it imposes mandatory notification to the NRC before any withdrawals fromthe NDT Fund can be made:The decommissioning trust agreement must provide that nodisbursements or payments from the trust, other than for ordinaryadministrative

expenses, shall be made by the trustee until the trusteehas first given the NRC 30 days prior written notice of payment.Renewed Operating License No. DPR-28, Condition 3(J)(a)(iii)

(March 21, 2011)(emphasis added). Second, it requires the Master Trust Agreement to grant NRCauthority to step in and prevent the licensee from making improper or potentially improper withdrawals:

The decommissioning trust agreement shall further contain a provision that no disbursements or payments from the trust shall be made if thetrustee receives prior written notice of objection from the Director ofthe Office of Nuclear Reactor Regulation.

2 Id. This latter requirement has already been executed in Section 4.05 of the MasterTrust Agreement (attached to this filing as Exhibit 2). Thus, the NRC has thisauthority under the MasterTrust Agreement.

Nevertheless, the NRC's ability tomake use of that authority would be significantly hindered by the elimination of the30-day notice requirement, since the elimination of that requirement would meanthat the NRC would not even know when Entergy was making withdrawals, letalone the purpose of the withdrawals.

The elimination of the 30-day noticerequirement would also hinder the ability of the Vermont Public Service Board toensure compliance with Section 4.06 of the Master Trust Agreement, which requiresapproval from the Board before Entergy can make withdrawals from the NDT Fundthat are outside of the withdrawals expressly contemplated by the Master TrustAgreement.

Entergy's LAR proposes to delete License Condition 3(J)(a)(iii),

even thoughthe 30-day notice requirement was a necessary condition of Entergy's purchase ofVermont Yankee. Although Entergy states that current NRC regulations willprovide "substantially similar decommissioning requirements as those found in VYOL License Condition 3.J" (LAR Attachment 1, p.3), they do not.While License Condition 3(J)(a)(iii) requires notification for each withdrawal and an opportunity for the NRC to prohibit potentially improper withdrawals, Section 50.75(h)(1)(iv) eliminates that notification for decommissioning expensesnow that Entergy has entered the decommissioning phase: "After decommissioning has begun and withdrawals from the decommissioning fund are made under3

§ 50.82(a)(8),

no further notification need be made to the NRC." 10 C.F.R.§ 50.75(h)(1)(iv)

(emphasis added). Thus, if the LAR is granted, the 30-day noticerequirement in License Condition 3(J)(a)(iii) will not be replaced with anyregulatory requirement of notice for withdrawals for decommissioning

expenses, letalone an equivalent one. Further, as explained in more detail below, Entergy's reference in the LAR to § 50.75(h)(1)(iv) fails to note that, subsequent to this LAR,Entergy has sought an additional partial exemption from that very same regulation.

As noted below, this link between the current LAR and the pending exiemption request underscores the need for the NRC to treat both requests together and toprovide a right to a hearing on both requests.

Entergy's request to eliminate License Condition 3(J)(a)(iii) would beproblematic on its own, but it is particularly problematic in light of recentindications by Entergy that it intends to use the NDT Fund to reimburse itself forexpenses that do not meet the NRC's definition of decommissioning.

For instance, as the State noted in its March 6, 2015 comments, Entergy's Decommissioning CostEstimate includes a number of items that the State believes fail to meet the NRC'sdefinition of decommissioning, such as:a. The $5 million payment (lines la.2.22 & lb.2.22) that Entergy is makingto the State as part of a Settlement Agreement (Attachment 2 of the VermontYankee PSDAR);b. Emergency preparedness costs (e.g., line la.2.23);

c. Shipments of non-radiological asbestos waste (e.g., line la.2.27);

4

d. Insurance (e.g., line la.4.1);e. Property taxes (e.g., line la.4.2);

andf. Replacement of structures during SAFSTOR (e.g., line 2b.1.4).The State's March 6, 2015 comments explain in detail why NRC regulations do notallow use of an NDT Fund for the above expenses, since expenses such as insurance do not reduce radiological contamination at the site. Exhibit 1 at 25-27; see also,e.g., Standard Review Plan for Decommissioning Cost Estimates for Nuclear PowerReactors, NUREG-1713, Final Report, at 4, § (B)(3) (2004) (to meet the NRC'sdefinition of "decommissioning" and thus be a proper withdrawal from the NDTFund, the activity must "reduce residual radioactivity").

More recently, and as the State also noted in its March 6, 2015 comments, Entergy has asserted a right to use NDT Funds not only for emergency preparedness expenses (which in itself are not an allowed use), but also for legalfees associated with those expenses:

Expenses for emergency preparedness do not reduce radiological contamination at the site and are thus not proper uses of the NDTFund. Entergy would therefore need an exemption (which has neitherbeen requested nor granted) before it could withdraw NDT Funds foremergency preparedness expenses.

Nevertheless, in addition to listingemergency planning as a license termination expense in Appendix C ofits Decommissioning Cost Estimate, an Entergy spokesperson recentlystated that Entergy intends to use NDT Funds not only for emergency preparedness

measures, but also for "any legal costs" resulting fromthe State's challenges to Entergy's planned reductions in emergency preparedness.

VTDigger.org, State Appeals Decision on VermontYankee Monitoring, http://vtdigger.org/2015/02/26/state-appeals-decision-on-vermont-yankee-emergency-monitoring/

(emphasis added).According to the Entergy spokesperson, these legal costs are "'part ofour decommission costs,' he said. 'This is money that's going to be5 coming from [the] trust fund."' Entergy's reasoning was that"[b]ecause the plant is no longer generating

revenue,

[the Entergyspokesperson]

said any legal costs the company incurs will come out ofthe decommissioning trust fund." Id. The NRC cannot allow that tohappen.Exhibit 1 (State's March 6, 2015 Comments on PSDAR) at 37 n.9.In light of the stated indication by Entergy to try to use the NDT Fund forexpenses that are not allowed under applicable NRC regulations, it would bearbitrary and an abuse of discretion for the NRC to eliminate the 30-day noticerequirement for NDT Fund withdrawals.

The importance of the 30-day noticerequirement is, if anything, heightened by Entergy's recent statements about use ofthe NDT Fund. Improper use of the NDT Fund places Vermonters and neighboring citizens at risk that the site will not be fully radiologically decontaminated.

Entergy's exemption

request, if granted, would directly impair the NRC's ability toensure compliance with its regulations, and thus place the public at risk thatEntergy will deplete the NDT Fund before it has met its obligation to safelydecommission the site.11 Entergy has publicly stated that, although it expects the NDT Fund to haveenough money to decommission the plant, it will not commit to making up any shortfall andanticipates that there would be litigation between the State of Vermont and the companyover any shortfall.

See VTDigger.org, Entergy Makes First Withdrawal fromDecommissioning Fund, http://vtdigger.org/2015/02/

ll/entergy-makes-first-withdrawal-decommissioning-fund/

("If the fund comes up short, [the Entergy representative]

said therewould be litigation between the state and the company as to how to pay for it."). Whenpressed further on the meaning of this testimony that was made to State legislators, theEntergy representative "said again..,

that he did not want Entergy committed to apromise that it would cover the cost if the project isn't done before the 2070s and funds arestill short." Associated Press,. Vermont Yankee official expects enough money to clean site(Feb. 27, 2015), available at http://www.washingtontimes.com/news/2015/feb/27/vermont-yankee-official-expects-enough-money-to-cl/.

6 As the State explained in detail in its March 6, 2015 comments, Entergy's proposed funding approach for decommissioning, spent fuel management, and siterestoration is problematic for at least two reasons.

First, applicable NRCregulations do not allow Entergy to use NDT Funds for anything other thanradiological decommissioning.

Those regulations serve an important

purpose, andthe NRC should not exempt Entergy from those regulations.

Second, the VermontYankee NDT Fund is subject to a Master Trust Agreement that Entergy signedwhen it purchased Vermont Yankee, and the State believes the Master TrustAgreement does not allow Entergy to make certain withdrawals it seeks to make.As the State also noted in its March 6, 2015 comments, the NRC has astatutory duty to ensure that Vermont Yankee's owners and operators have-andwill continue to have-the ability to pay for decommissioning.

The NRC is chargedwith overseeing each nuclear power plant's NDT Fund to ensure that each fund issufficient to fully decontaminate the site to below the NRC's allowed radiological limits. As the U.S. Court of Appeals for the Seventh Circuit recently held, "[t]hedecommissioning of nuclear facilities is closely regulated by the Nuclear Regulatory Commission, and its regulatory authority embraces every potential malfeasance ormisfeasance of assets dedicated to the decommissioning process."

Pennington v.Zionsolutions LLC, 742 F.3d 715, 719 (7th Cir. 2014) (Posner, J.). As "thedesignated policeman of decommissioners,"

the NRC is tasked with "assess[ing]

themanagement of the complex, technologically sophisticated process of nuclear7 decommissioning."

Id. Elimination of the 30-day notice requirement in LicenseCondition 3(J)(a)(iii) would significantly impair the NRC's ability to fulfill this role.Further, the 30-day notice requirement of License Condition 3(J)(a)(iii) should be viewed in the context in which it arose. Entergy's LAR requests that "[t]obe consistent with this amendment

request,

[Entergy]

also requests that the NRCappropriately modify its May 17, 2002 Order and safety evaluation which approvedthe transfer" of Vermont Yankee's license.

LAR at 2. This request glosses over thefact that License Condition 3(J)(a)(iii) was imposed by the NRC as a necessary condition to the NRC's approval of the sale of Vermont Yankee.When Entergy bought the Vermont Yankee plant in 2002, the sale includedthe NDT Fund with approximately

$310 million (which has now grown to around$665 million) in ratepayer money-the majority of which came from Vermontratepayers.

Entergy has never contributed to the fund. At the time of the sale,those same Vermont ratepayers bargained for a 55% interest in any leftover moneyfrom the NDT Fund. This matter was heavily litigated.

The NRC, by orderingLicense Condition 3(J)(a)(iii),

assured the public at the time of the sale that Entergywould have to provide a 30-day notice for any withdrawals from the NDT Fund, andthus provide the NRC with an opportunity to exercise its oversight of the NDT Fundand provide the State and interested citizens with an opportunity to comment onand, when appropriate, opposing unauthorized withdrawals from the NDT Fund.This license requirement helps ensure compliance with applicable NRC regulations, 8

which by definition serve the NRC's overriding goal of protecting public health andsafety by mandating adequate funding for radiological decommissioning.

Unlike Entergy's cited precedent of the Comanche Peak Steam ElectricStation (LAR Attachment 1, p.8), Entergy waited 12 years after passage of the ruleit cites, and-at the very moment when License Condition 3(J)(a)(iii) comes intoeffect, now that Entergy must for the first time submit the required 30-day noticesfor withdrawals-Entergy seeks to eliminate that requirement.

The NRC shouldnot allow Entergy to do so.2II. Entergy has filed an exemption request that is directly related to theLAR, and the State should have an opportunity for a hearing on thedirectly related exemption request.On January 6, 2015, Entergy filed an exemption request (ADAMS Accession No. ML15013A171) to allow it to access the NDT Fund for spent fuel management expenses and to eliminate any 30-day notice requirement to the NRC for NDT Fundwithdrawals relating to spent fuel management.

The exemption request presumesthe LAR will be granted, and then asks for an exemption from the very regulations Entergy is relying on in the LAR. In particular, Entergy states in the LAR that the2 Entergy offers no justification for its 12-year delay. The proceeding in whichEntergy sought permission to own Vermont Yankee-and committed to the 30-day noticerequirement it now seeks to rescind-ended more than. 12 years ago. Likewise, the rulethat Entergy cites as the basis for its LAR was promulgated more than 12 years ago. Yet, itwas not until the current LAR filing that Entergy sought to amend the Order that wasissued as a result of the sale proceeding, even though the event Entergy relies uponoccurred over 12 years ago. Cf. 10 C.F.R. § 2.323(a)(2)

(requiring motions to be filed in atimely manner after "the occurrence or circumstance from which the motion arises");

In. reEntergy Nuclear Vermont Yankee L.L.C. & Entergy Nuclear Operations, Inc. (VermontYankee Nuclear Power Station),

2005 NRC LEXIS 11, at 3-4 (Feb. 16, 2005) (agreeing withEntergy's argument that the failure of another party to file a motion soon after the eventthat formed the basis for the motion made the motion untimely).

9 30-day notice provision in License Condition 3(J)(a)(iii) is "addressed in theregulations" and cites 10 C.F.R. § 50.75(h)(1)(iv) as the relevant regulatory requirement.

LAR at Attachment 1, pp.3-4. Leaving aside the fact that (asexplained above) the 30-day notice requirement in 10 C.F.R. § 50.75(h)(1)(iv) isalready much more limited than License Condition 3(J)(a)(iii),

the LAR cannot relyon the same regulation that it has also sought an additional exemption from in alater filing. In particular, the first page of Entergy's January 6, 2015 exemption request notes that it seeks, in addition to permission to use the NDT Fund for spentfuel management

expenses, "an exemption from 10 CFR 50. 75(h)(1)(iv) for the samereason, and also to allow trust fund disbursements for irradiated fuel management activities to be made without prior notice" (emphasis added).Although the NRC has held that, in general, an exemption request does notcreate hearing rights, the NRC has created a clear exception to this rule to allow fora hearing on exemption requests that are "directly related" to a LAR. In the Matterof Private Fuel Storage, LLC ("PFS"),

CLI-01-12, 53 NRC 459, 476; see also, e.g., Inthe Matter of Honeywell International, Inc., CLI-13-1, 77 NRC 1, 7 ("But when alicensee requests an exemption in a related license amendment application, weconsider the hearing rights of the amendment application to encompass theexemption request as well.").

Because the LAR is directly related to Entergy's January 6, 2015, the State should have an opportunity for a hearing on the directlyrelated exemption request.10 III. The LAR should be denied because it has not undergone therequired environmental review and, despite Entergy's claim to thecontrary, the LAR is not categorically excluded from that review.The National Environmental Policy Act and applicable NRC regulations require at least some level of environmental review before the NRC acts on matterspotentially affecting the environment.

Entergy's LAR asserts that it is categorically excluded from all environmental review on the basis that the LAR "is confined toadministrative changes for providing consistency with existing regulations" and this"meets the eligibility criterion for categorical exclusion set forth in 10 CFR[§] 51.22(c)(10)."

LAR, Attachment 1, p.8.The LAR is not categorically excludedfrom environmental review under 10 C.F.R. § 51.22(c)(10).

First, Entergy has failed to identify which specific subsection of § 51.22(c)(10) it is relying on for categorical exclusion.

Section 51.22(c)(10) reads in its entirety asfollows:(10) Issuance of an amendment to a permit or license issuedunder this chapter which-(i) Changes surety, insurance and/or indemnity requirements; (ii) Changes recordkeeping, reporting, or administrative procedures or requirements; (iii) Changes the licensee's or permit holder's name, phonenumber, business or e-mail address;(iv) Changes the name, position, or title of an officer of thelicensee or permit holder, including but not limited to, the radiation safety officer or quality assurance manager; or(v) Changes the format of the license or permit or otherwise makes editorial, corrective or other minor revisions, including theupdating of NRC approved references.

None of those subsections applies to Entergy's LAR.11 Second, to the extent Entergy contends that it falls within subsection (ii)since Entergy describes the LAR as "confined to administrative changes,"

thatdescription is incorrect.

The LAR is not a change to an administrative procedure, but rather has a direct substantive effect of eliminating the current 30-day noticerequirement for withdrawals from the NDT Fund, which in turn hinders the NRC'sability to ensure that the NDT Fund remains adequate to cover the radiological decommissioning that is necessary to protect public health, safety, and theenvironment.

As noted above and in greater detail in the State's expressly incorporated March 6, 2015 comments, the State has a number of reasons to beconcerned that, without proper oversight, Entergy may deplete the NDT Fundbefore the site is radiologically decontaminated.

If the NRC allows that to happen,it would greatly impact public health, safety, and the environment.

CONCLUSION For the reasons noted in these Comments and in the State's expressly incorporated March 6, 2015 comments, the NRC should reject Entergy's LicenseAmendment Request.12 Exhibit 1VT Ex. 1 001 UNITED STATES OF AMERICANUCLEAR REGULATORY COMMISSION In the Matter of:Entergy Nuclear.

Operations, Inc., VermontYankee Nuclear Power Station Post-Shutdown Decommissioning Activities ReportDocket No. NRC-2015-0004 Docket No. 50-271Comments of the State of VermontSubmitted:

March 6, 2015OFFICE OF THE ATTORNEY GENERALWilliam H. SorrellAttorney GeneralScot L. KlineEnvironmental Protection Division ChiefKyle H. Landis-Marinello Assistant Attorney General109 State StreetMontpelier, Vermont 05609AGENCY OF NATURAL RESOURCES Department of Environmental Conservation David MearsCommissioner Chuck SchwerWaste Management and Prevention Division DirectorJordan GondaAssociate General CounselOne National Life DriveMontpelier, VT 05620DEPARTMENT OF PUBLIC SERVICEChristopher RecchiaCommissioner Aaron KisickiSpecial CounselAnthony Z. RoismanOf Counsel112 State StreetMontpelier, Vermont 05602DEPARTMENT OF HEALTHHarry Chen, M.D.Commissioner William Irwin, Sc.D., CHPRadiological and Toxicological SciencesProgram Chief108 Cherry StreetBurlington, VT 05401 TABLE OF CONTENTSPageIN TR O D U CTIO N .......................................................................................

1I. The NRC Should Require Entergy to Address the State'sConcerns-Expressed Today and in Comments the StatePreviously Provided to Entergy-and Hold a Full Adjudicatory Hearing on Whether Entergy Can Proceed with ItsD ecom m issioning Plans .....................................................................

2II. The NRC Should Require the PSDAR, Decommissioning CostEstimate, and Related Filings to Provide Reasonable Assurance that Adequate Funds Will Be Available for Decommissioning

.............

5A. To Ensure Adequate Funding for Decommissioning, theNRC Should Require Entergy to Revise Its Cost Estimates

...........

5i. The NRC should require Entergy to do additional radiological and non-radiological site characterization

...... 9ii. The NRC cannot allow Entergy to assume that it will haveno spent fuel management expenses after 2052 ......................

19iii. The NRC cannot allow Entergy to assume that siterestoration will cost only $57 million ....................................

23B. To Ensure Adequate Funding for Decommissioning, theNRC Should Limit Entergy's Use of the Vermont YankeeNDT Fund at This Time to Activities that ReduceRadiological Contam ination ......................................................

24i. NRC regulations limit NDT disbursements to activities that reduce radiological contamination

..................................

25ii. The Master Trust Agreement limits NDT disbursements atthis time to activities that reduce radiological contam ination ....................................................................

.27III. In Accordance with the National Environmental Policy Act, theNRC Must Analyze the Environmental Impacts of Entergy's Proposed PSDAR and Related Filings ...............................................

40i IV. The NRC Should Require Entergy to Revise Its AnalysesRegarding the Emergency Planning Zone ........................................

54A. Entergy Cannot Assume a Reduced Emergency PlanningZ o n e .....................................................................................

.... 55B. Even If Entergy Could Assume a Reduced Emergency Planning Zone, That Assumption Would Require Additional Environmental Analyses to Comply with the NationalEnvironmental Policy Act and NRC Regulations

.....................

55V. The NRC Should Require Entergy to Address Numerous OtherDeficiencies in the PSDAR and Related Filings .................................

59C O N C L U SIO N .............................................................................................

64A D D E N D U M ...........................................................................................

66ii INTRODUCTION The State of Vermont and its citizens have a direct and ongoing interest in allaspects of the decommissioning, spent fuel management, and site restoration of thenuclear power plant that lies within the State's borders.

The Vermont YankeeNuclear Power Station (Vermont Yankee) is in Vernon, Vermont, on the banks ofthe Connecticut River. After 42 years of generating power, Vermont Yankee hasnow ceased operations.

On December 19, 2014, Entergy Nuclear Operations, Inc.(Entergy) submitted its Post Shutdown Decommissioning Activities Report(PSDAR),

including a site-specific Decommissioning Cost Estimate (DCE) (ADAMSAccession No. ML14357A110).

On that same day, Entergy submitted several otherfilings, including an Updated Irradiated Fuel Management Plan (ADAMS Accession No. ML14358A251) and an Updated Decommissioning Funding Status Report(ADAMS Accession No. ML14358A250).

On January 6, 2015, Entergy filed anexemptions request to allow it to access the Nuclear Decommissioning Trust (NDT)Fund for spent fuel management expenses (ADAMS Accession No. ML15013A171).

The State of Vermont objects to these filings.

While Entergy has previously worked with the State toward mutually agreeable solutions on a number of matters,including an omnibus Settlement Agreement in December 2013 that resolved manylegal and policy disputes between the parties, Entergy's latest round of filings weremade with full knowledge that the State objected to many aspects of these filings.1 The State respectfully requests that the Nuclear Regulatory Commission (NRC) act immediately to force Entergy to address the many concerns the Stateraises in its Comments below and in the attachments to these Comments.

I. The NRC Should Require Entergy to Address the State's Concerns-Expressed Today and in Comments the State Previously Provided toEntergy-and Hold a Full Adjudicatory Hearing on Whether EntergyCan Proceed with Its Decommissioning PlansIn December 2013, after Entergy had announced its plans to shut down bythe end of 2014, the State of Vermont and Entergy signed an omnibus Settlement Agreement that resolved many legal and policy disputes between the parties.Entergy has attached that Settlement Agreement to its recently submitted PSDAR.In paragraph 6 of the Settlement Agreement, Entergy agreed to provide the Statewith a comprehensive site assessment study. Paragraph 6 then states that Entergy"shall review the results of the study" with the Department of Public Service, theAgency of Natural Resources, and the Department of Health, and Entergy "shallconsider any comments provided by those parties for inclusion in the PSDAR." Toensure that this occurred, the Settlement Agreement imposed a minimum period of"sixty (60) days after completing the site assessment study" before Entergy couldsubmit its PSDAR. The clear intent of this paragraph was that a meaningful dialogue would occur between Entergy and the State during the 60-day waitingperiod when Entergy was required to review and consider the State's comments.

Unfortunately, Entergy effectively ignored the substantive comments provided bythree separate State agencies during this 60-day time period.2 On December 13, 2014, within the required 60-day waiting period, VermontDepartment of Public Service Commissioner Christopher Recchia sent Entergydetailed comments from three separate State agencies, including 190 itemizedcomments explicitly requesting a response or additional information from Entergyto better understand Entergy's post-closure plans and thus allow the agencies todetermine whether Entergy's post-closure activities will comply with applicable law.Despite its contractual obligation to "consider" the State's comments beforesubmitting its PSDAR (Settlement Agreement

¶ 6), Entergy appears to have notdone so. The PSDAR that Entergy submitted to the NRC on December 19, 2014contains an internal date on every page of "December 2, 2014"-which is 11 daysbefore the State provided Entergy with the comments Entergy was required toconsider.

The entirety of the State's December 13, 2014 submittal is attached-and expressly incorporated into-these Comments.

See Exhibit 1. Entergy's siteassessment study and the draft filings it provided to the State in October 2014 arealso attached.

See Exhibit 2. Although Entergy-on February 28, 2015, more thantwo months after it already submitted the PSDAR-provided a limited response tosome of the comments the State submitted, its response was inadequate and.did notprovide the State agencies with the information they requested.

See Exhibit 3. Inits February 28, 2015 letter, Entergy responded to only a portion of the State'scomments, and although Entergy stated that it was responding to all of the State'scomments on the PSDAR, it did not do that. It did not address the State's3 comments on draft documents like the TLG Maximum SAFSTOR Cost Estimate, even though that document was incorporated (without any apparent changes) intoAppendix C of the Decommissioning Cost Estimate that was included withEntergy's PSDAR.1 The NRC should require Entergy to provide a detailed responseto all of the State's December 13, 2014 comments before the NRC allows Entergy toproceed with its decommissioning plans.The NRC should also require Entergy to respond to the State's Commentsprovided today before the NRC allows Entergy to proceed with its decommissioning plans. If there is to be any meaning given to the State's rights under NRCregulations to comment on Entergy's proposed PSDAR, the NRC should requireEntergy to respond to the State's concerns.

In these circumstances, the NRC can-and should-"findf that a hearing isrequired in the public interest" and provide a full adjudicatory hearing.

10 C.F.R.§ 2.104. Many of Entergy's specific requests for exemptions, License Amendment

Requests, and its December 19, 2014 filings, including the PSDAR andDecommissioning Cost Estimate, are interrelated, amend the terms of their license,and should be addressed comprehensively in an adjudicatory hearing.

As explained below, Entergy's PSDAR, Decommissioning Cost Estimate, and related filings raisea number of previously unaddressed issues that greatly affect the public interest.

This is particularly important in light of the piecemeal approach that Entergy has1 Further, even for the State comments that Entergy responded to, many of itsresponses were simply cross-references that were in fact unresponsive to the issues raisedby the State.4 taken to its post-closure-related filings with the NRC over the last year. The publicinterest requires a full adjudicatory hearing to address the concerns expressed inthese Comments.

II. The NRC Should Require the PSDAR, Decommissioning Cost Estimate, and Related Filings to Provide Reasonable Assurance that AdequateFunds Will Be Available for Decommissioning NRC regulations do not allow Entergy to take any decommissioning actionsthat would "[r]esult in there no longer being reasonable assurance that adequatefunds will be available for decommissioning."

10 C.F.R. § 50.82(6)(iii).

Entergy's PSDAR, Decommissioning Cost Estimate, and other December 19, 2014 filings,including updates to its Irradiated Fuel Management Plan and Decommissioning Funding Status Report, make clear that Entergy intends to access the NDT Fundfor non-decommissioning uses, including spent fuel management expenses.

Entergy's January 6, 2015 exemption request explicitly seeks permission to use theNDT Fund for spent fuel management expenses.

The NRC should reject thatrequest and take all other necessary actions to ensure that each of Entergy's withdrawals from the NDT Fund complies with applicable NRC regulations andwith the Master Trust Agreement that Entergy signed when it bought VermontYankee. See Exhibit 4.A. To Ensure Adequate Funding for Decommissioning, the NRCShould Require Entergy to Revise Its Cost Estimates Entergy's Decommissioning Cost Estimate includes a number of assumptions that undermine Entergy's claim of reasonable assurances that it will meet its legalobligation to decommission Vermont Yankee. The NRC should require Entergy to5 revise its cost estimates to address the risk that some of these assumptions mayprove incorrect.

In evaluating any claim that the NDT Fund contains "excess"funds-as Entergy asserts in its December 19, 2014 filings and its January 6, 2015exemptions request-the NRC must take into account recognized contingencies thatwould increase the total cost for decommissioning, spent fuel management, and siterestoration.

It is no great insight that Entergy's financial analysis and its claim of"excess" funds are based upon many assumptions that may not come to be. Indeed,the only significant change between the draft PSDAR that Entergy provided theState in October 2014 and the later version that Entergy submitted to the NRCappears to be the addition of a regulatory commitment "to provide a total inparental assurance of up to 10% of the remaining trust fund balance or $40 million,whichever is less." PSDAR List of Regulatory Commitments.

This addition to thePSDAR is telling because it is triggered

"[i]n the event that additional financial assurance beyond the amounts contained in the remaining trust fund... isrequired."

Id. In other words, Entergy concedes-as it must-that the trust fundmight turn out to be inadequate, thus triggering "the event that additional financial assurance" is needed. Id. But at that point, the NRC regulations have failed toassure adequate funding for decommissioning.

At that point, where "additional financial assurance

... is required,"

Entergyshould not place a limit on how much assurance it will provide, much less a limitthat decreases the lower the fund balance goes, as occurs with Entergy's 6

"commitment" of $40 million or "10% of the remaining trust fund balance ...whichever is less." Id. Depending on the circumstances (e.g., market decline),

theamount should be increased the lower the fund balance goes. Yet Entergy's parental assurance "commitment" literally goes to $0 once the NDT Fund goes to$0.In other words, at the very moment when a parental guarantee may well beneeded, it no longer exists.The lack of a true parental guarantee is not a small matter, particularly given that Vermont Yankee is one of the first merchant generators to undergo thedecommissioning process.

As the NRC heard from numerous members of the publicduring the public hearing on February 19, 2015, Vermonters are greatly concerned about whether the corporation of Entergy will exist decades from now when Entergymust begin radiological decontamination and dismantlement.

If at any pointEntergy fails to pay for all of the radiological decommissioning and spent fuelmanagement that is needed at the site, the State's concern is that uncovered costsmay ultimately fall upon the citizens of Vermont.

The NRC has a legal duty toensure that this does not occur. At the February 19, 2015 hearing, NRC officials assured Vermonters that Entergy would not be allowed to walk away from its legalobligations.

The NRC made similar reassurances in a later statement to the press:"We're not going to just let them walk away. Even if it involvedworking with the Department of Justice to go after the parentcompany,"

said NRC spokesperson Neil Sheehan.

"Even if thecompany dissolves, they still have assets. Entergy owns a7 transmission company ... and they own other nuclear power plantsother than this."VTDigger.org, Residents Seek Assurance from Feds on Vermont YankeeDecommissioing (Feb. 22, 2015), http://vtdigger.org/2015/02/22/residents-seek-assurance-feds-vermont-yankee-decommissioning/.

While the State of Vermont appreciates these reassurances, such statements are not a substitute for the NRC's legal obligation to uphold regulatory requirements that ensure that Entergy will have adequate funds to decommission Vermont Yankee. This is especially important in light of the fact that Entergy hasalready publicly expressed its view that, although it expects the fund to haveenough money to decommission the plant, Entergy expects litigation between theState of Vermont and the company over any shortfall.

See VTDigger.org, EntergyMakes First Withdrawal from Decommissioning Fund,http://vtdigger.org/2015/02/11/e ntergy-makes-first-withdrawal-decommissioning-fund/ ("If the fund comes up short, [the Entergy representative]

said there would belitigation between the state and the company as to how to pay for it.").If such a lawsuit is ever brought by the State of Vermont, by the NRCworking with the Department of Justice, or by all three governmental agenciesworking cooperatively, everyone will look back at the decisions the NRC makes (orfails to make) over the next few months and wonder what went wrong. And if suchlawsuits fail, or succeed in a pyrrhic way because even the parent company isinsolvent at that point, the State of Vermont could be left with a radiologically 8

contaminated site and spent nuclear fuel within its borders.

The State asks theNRC to do everything within its power now to ensure that this does not occur.In particular, as noted in more detail below, there are several concrete stepsthat the NRC can-and should-take now to ensure adequate funding fordecommissioning.

i. The NRC should require Entergy to do additional radiological andnon-radiological site characterization.

Although Entergy chose to submit itsPSDAR more than two years before this filing is due, Entergy has until December2016 to submit its PSDAR. The NRC should require Entergy to use this time toengage in a more thorough radiological and non-radiological site characterization.

This is especially important in light of the recent discovery of radionuclides likestrontium-90 in locations where those contaminants have not previously beendiscovered.

The characterization of the site (radiological and non-radiological) has not yetoccurred.

Rather, Entergy has elected to wait decades until nearly the end of theallowed SAFSTOR period before engaging in this characterization.

The decision todelay characterization makes it incredibly difficult for the NRC and the State ofVermont, including the Department of Health, the Agency of Natural Resources, and the Department of Public Service, to evaluate the PSDAR. The decision todelay characterization also calls into question all of the cost estimates that Entergyhas provided in its PSDAR and related filings.

Without a full site characterization, 9

there is no way to determine what it will ultimately cost to perform radiological decommissioning, spent fuel management, and site restoration.

Overall, the PSDAR is written with inadequate detail for the Department ofHealth to be confident that the public health and the environment are protected during any of the five plant status types-transition from operations, SAFSTORdormancy, preparations for dismantling and decontamination, dismantling anddecontamination, and site restoration.

For instance, the PSDAR does notadequately estimate the number and type of personnel onsite to accomplish work,especially:

wet spent fuel operations; fire protection; monitoring of structure, system, and component integrity; and radiological environmental monitoring.

2 ThePSDAR also fails to identify what external resources (local, state, or federal)Entergy is relying on to protect the health and safety of the public during thevarious phases of post-shutdown activities.

Without adequate information on theseand other matters, the Department of Health cannot be certain that public healthand safety will be served to the degree needed.The PSDAR also does not describe the depth and breadth of the plannedradiological environmental monitoring program.

Doing so is important because ofthe large volume of radioactive materials generated by plant operations and to bemaintained within the structures,

systems, and components during each phase of2 It is unclear why the plant staffing is not adequately identified, given that suchinformation is routinely included in supplemental data developed by TLG in performing decommissioning costs estimates.

The PSDAR should provide the staffing plan for eachphase of post-shutdown activities and describe how the plant activities and programs areexpected to change over the phases of post-shutdown activities.

10 decommissioning.

At multi-unit sites like Millstone 1 and Indian Point 1, there is arobust radiological environmental monitoring program that covers the unit that isin SAFSTOR.

The PSDAR provides no indication that robust radiological environmental monitoring is planned or will be executed at Vermont Yankee.The PSDAR also inadequately describes radiological emergency preparedness during decommissioning.

The basis of emergency planning ignores hostile actionbased scenarios that could destroy key structures storing radioactive materials orresult in a zirconium fuel cladding fire while fuel remains in the spent fuel pool.The Department of Health has concerns for public health during the time toprepare for SAFSTOR and when spent fuel is transferred from the spent fuel pool todry casks. Plans are inadequately described in the PSDAR to assure theDepartment of Health that accidents and releases that may affect the environment and public health can be managed by Entergy with a dramatically reduced workforce. The Department of Health is concerned as well about radioactive materialreleases during the period of decontamination and dismantling just before licensetermination.

Concerns arise due to the complex and unique nature of theradiological industrial and transportation activities to occur duringdecontamination and dismantling.

Throughout the SAFSTOR years, large quantities of radioactive materials insolid and liquid form will be left in storage onsite where leaks have occurred in thepast, and may occur again. In addition to radioactive material

storage, inventory management and monitoring, and response to leaks into the environment, there is a11 serious concern about fire protection for the structures,

systems, and components containing radioactive materials in storage.

Capabilities to monitor for and respondto these kinds of radiological emergencies are not adequately addressed in thePSDAR.The inadequacy of the PSDAR's site characterization violates directlyapplicable NRC regulatory guidance.

For instance, the NRC has directed that "[t]hecost of remediating known environmental contamination should be included (soil,groundwater, surface water, etc.)" in the PSDAR. NRC Regulatory Guide 1.185 at8. Entergy's PSDAR does not meet this requirement because such costs cannot beestimated without more detailed site characterization.

One clear omission from the PSDAR (and the Site Assessment Study thatEntergy did before completing the PSDAR) is the recent discovery of strontium-90 in locations where that contaminant had not previously been discovered.

SeeVermont Department of Health Communications Office, Strontium-90 Detected inGround Water Monitoring Wells at Vermont Yankee (Feb. 9, 2015),http://healthvermont.gov/news/2015/020915_vystrontium90.aspx.

The Department of Health also found cesium-137, strontium-90, and other long half-life radioactive materials in soil samples taken in 2010. Seehttp://healthvermont.gov/enviro/rad/yankee/laboratoryitesting.aspx.

The Department of Health's publication of results regarding strontium-90 ingroundwater wells occurred after Entergy submitted its PSDAR. At this point, wealready know of at least one way in which the Decommissioning Cost Estimate is12 incorrect-namely, the analysis underlying the estimated amount of soil removalthat will be needed surrounding the advanced off-gas (AOG) building.

On thatissue, Entergy has stated the following:

It should be noted that no additional remediation of the soil in thevicinity of the AOG building was included, based upon the earlierremediation (soil removal) performed by Entergy VY and the findingsfrom the GZA groundwater investigation that only tritiuin hadmigrated into the groundwater.

Tritium is a low-energy beta emitterwith a half-life of approximately 12.3 years, decaying to non-radioactive helium. As such, any residual sub-grade tritium is notexpected to require any further remediation at the time ofdecommissioning in order to meet site release criteria.

Decommissioning Cost Estimate,

§ 3, page 12 (emphasis added; footnote omitted).

The Decommissioning Cost Estimate is clearly out-of-date and incorrect in itsclaim that "only tritium ha[s] migrated into the groundwater" in this area. Id. Thisnew data on strontium-90 creates doubt regarding Entergy's claim in the PSDARthat previous excavation of the AOG leakage site eliminates the need to excavatedeeper than three feet below grade. See id.; see also id. at § 3, page 13 (noting thatfoundations and building walls will only be removed "to a nominal depth of threefeet below grade").

Many long-lived radionuclides are likely to be found in soils andgroundwater far from the small excavation made to repair the leaks that likelyallowed reactor condensate to enter into the site soils for many years. In addition, these same long-lived radionuclides are likely to be found in the structures,

systems, and components left during SAFSTOR and then later decontaminated anddismantled.

13 At an absolute

minimum, the recent discovery of strontium-90 requiresfurther analysis by Entergy and revision of the PSDAR to take this into account.This is an important issue because the presence of strontium-90 or otherlong-lived radionuclides could greatly increase the costs of decommissioning andsite restoration.

NRC regulatory guidance on the requirements of a PSDARspecifically directs that "[t]he cost of remediating known environmental contamination should be included (soil, groundwater, surface water, etc.)." NRCRegulatory Guide 1.185 at 8. Entergy's PSDAR does not meet this requirement.

Long half-life radioactive materials are to be expected to be found in soils atVermont Yankee. These include 5,730-year half-life carbon-14, 100-year half-life nickel-63, 29-year half-life strontium-90, 30-year half-life cesium-137, 13.5-year half-life europium-152, and 12.3-year half-life hydrogen-3.

See Abelquist, Eric W.,Decommissioning Health Physics, A Handbook for MARSSIM Users (2d Ed. 2014).These radioactive materials and hard-to-detect radionuclides were found in thedecommissioning of both Maine Yankee and Connecticut Yankee in addition totransuranics, radioisotopes of plutonium, curium, neptunium, and americium.

SeeLetter from Thomas L. Williamson, Maine Yankee Director of Nuclear Safety andRegulatory Affairs to NRC (Jan. 16, 2002) (ADAMS ML020440651).

Further, as theState pointed out to Entergy in the State's December 2014 comments, carbon-14 hasbeen a major issue in the decommissioning of other sites such as Yankee Rowe andis expected to be a concern in the decommissioning of future sites such as SanOnofre. Despite the State's explicit

request, Entergy has not yet provided any14 evaluations,

analyses, or other bases for assuming that carbon-14 will not be ofconcern in decommissioning Vermont Yankee.Conversations with Health Department staff in Maine and withEnvironmental Conservation Department staff in Connecticut indicate thatdecommissioning is likely to reveal unanticipated radioactive sources to beremediated.

These included pockets of highly contaminated groundwater dammedup by existing structures at Maine Yankee and a 25-foot-deep 225-foot-long excavation of soil around the reactor water storage tank at Connecticut Yankee.These kinds of potential situations are not adequately accounted for in the PSDAR.The PSDAR provides no assurance that the challenges of remediating theseradioactive materials are factored into the planning and funding for thedecommissioning of Vermont Yankee.Even if strontium-90 had not recently been discovered, the PSDAR would bedeficient given other evidence that soil contamination exists-and that remediation is thus likely to be needed-more than three feet below grade. The October 2014Site Assessment Study documents the 1991 leak in the chemistry lab drain line, theAOG reactor condensate leaks confirmed in 2009, the piping leaks between theradioactive waste building and the AOG building discovered in 2010, and otherspills and leaks of radioactive materials.

The area between the Connecticut River,the intake structure, the discharge structure, and the reactor,

turbine, andradioactive waste buildings may contain large volumes of contaminated soilrequiring excavation to meet the derived concentration guideline levels for15 appropriate remediation in accordance with the Multi-Agency Radiation Survey andSite Investigation Manual. Significant leakage of reactor condensate andradioactive materials spills have occurred:

in the AOG piping tunnel; in pipingbetween the AOG building and the radioactive waste building; in and around theradioactive waste building; in the condensate storage tank courtyard; and betweenthe Connecticut River and the reactor, radioactive waste, and AOG buildings.

Entergy should sample soils at depths greater than three feet and be prepared toremove contaminated soil for off-site disposal when necessary.

If Entergy fails toremediate beyond three feet below grade, contamination could reach thegroundwater and river water down-gradient of these areas. The PSDAR providesno information to determine whether the human and financial resources requiredfor all necessary soil removal and other remediation will be available at the timethe remediation must occur.Because an adequate characterization of the site (radiological and non-radiological) has not yet been done, Entergy cannot provide an accurate estimate ofthe scope of work and resulting costs for decommissioning.

Indeed, Entergy's Decommissioning Cost Estimate explicitly recognizes (at page vii) that it "may notreflect the actual plan to decommission Vermont Yankee."More generally

speaking, the PSDAR does not provide sufficient information about the plans and resources to be dedicated to post-shutdown decommissioning activities at Vermont Yankee. The lack of sufficient information in the PSDARleaves the Department of Health unable to ensure that Entergy will leave the site16 in a safe condition that will not lead to adverse health effects.

Entergy mustprovide the NRC and the State of Vermont with substantial additional information before the NRC allows Entergy to proceed with its decommissioning plans. Thiswould provide, among other things, the needed assurance that there will be:(1) robust environmental surveillance of this site where large volumes of radioactive material as well as asbestos, lead, and other hazardous materials may be stored forfifty years or more before disposal3; (2) adequate staff and other resources tomonitor the integrity of structures,

systems, and components that contain theseradiological and other hazardous materials; and (3) adequate plans and funding toassure the removal of soils and other sources of radioactive and other hazardous contamination that resulted from 42 years of operation in Vermont, including manyyears of long-unidentified leaks and identified radiological and non-radiological incidents.

As noted above, Entergy has until December 2016 to submit its PSDAR, andthe NRC should require Entergy to use this time to engage in a more thorough sitecharacterization so that it can make a more accurate Decommissioning CostEstimate in connection with its PSDAR. At a minimum, if a more detailed sitecharacterization is not going to occur until after the SAFSTOR period, then the3 The Department of Health has comprehensive regulations governing asbestos andlead. See Department of Health, Vermont Regulations for Asbestos Control (1995),http://healthvermont.gov/regs/asbestoscontrol-reg.pdf; Department of Health, VermnontRegulations for Lead Control, http://healthvermont.gov/regs/VRLCFINAL0912.pdf.

ThePSDAR does not explain what actions Entergy plans to take to ensure compliance withthese regulations during post-closure operations.

17 NRC should require Entergy to plan for contingencies that may not be discovered until that time.As it stands, although Entergy's Decommissioning Cost Estimate claims totake into account "contingencies,"

it in fact does not do so. Rather, Entergy putsforth an estimate "based on ideal conditions" and then factors in "a percentage contingency" based on "unforeseeable events that are almost certain to occur indecommissioning, based on industry experience."

Decommissioning Cost Estimateat xii (emphasis added). Entergy goes on to note that "[clontingency funds ... areexpected to be fully expended."

Id. (emphasis added); see also id. at § 3, page 4("Contingency funds are expected to be fully expended throughout the program.").

If such funds are "expected to be fully expended,"

then-by definition-they are notreally contingencies, but rather expenses that are expected to occur.Actual contingencies-such as the discovery of strontium-90 and otherradionuclides in places not previously thought to be contaminated-have historically led to enormous escalations in decommissioning costs. For instance, atConnecticut Yankee, the discovery of strontium-90-the very same radiological contaminant that was recently discovered in the groundwater at Vermont Yankee-led to an enormous decommissioning cost escalation during the radiological decontamination and dismantlement phase that Entergy intends to postpone untilthe end of its SAFSTOR period. Yet Entergy categorizes all of these types ofpotential expenses as "financial risks" and explicitly notes that it "does not add any18 additional costs to the estimate for financial risk." Decommissioning Cost Estimate§ 3, page 6 (emphasis added).The NRC cannot allow Entergy to ignore contingencies that may not bediscovered until the site is characterized after the SAFSTOR period. This isparticularly true in light of Entergy's January 6, 2015 exemption request and otherfilings that explicitly request that the NRC rely upon this already-outdated Decommissioning Cost Estimate as proof that there are allegedly "excess" funds inthe NDT Fund.ii. The NRC cannot allow Entergy to assume that it will have no spentfuel management expenses after 2052. Entergy's cost estimates include nofunding for spent fuel management beyond 2052, and thus provide no explanation for how decommissioning costs might escalate if spent fuel remains onsite at thetime that decontamination and dismantlement begins. Further, Entergy's claim of"excess" funds in the NDT Fund is predicated on the assumption that all spent fuelwill be removed by 2052. This assumption conflicts with federal law, historical andcurrent political realities, and recent statements from the NRC, the U.S. Court ofAppeals for the District of Columbia

Circuit, and the Vermont Public Service Board.The NRC cannot allow Entergy to make assumptions that require, amongother things, changes to current law. Yet, according to the U.S. Government Accountability Office (GAO), a change to current law is precisely what is needed toallow the U.S. Department of Energy (DOE) to begin accepting spent fuel in 2026and complete the removal of spent fuel by 2052, as Entergy assumes will occur.19 Entergy's entire Updated Irradiated Fuel Management Plan, and all of its costestimates for spent fuel management

expenses, depend upon DOE's plan to attemptto site an interim storage facility by 2025. (There is clearly no prospect of YuccaMountain opening within the next 10 years.) But the GAO has stated that aninterim storage facility requires congressional action because "new legislative authority is needed for developing interim storage that is not tied to YuccaMountain."

GAO 15-141, Spent Nuclear Fuel Management at 20 (October 2014),available at http://www.gao.gov/assets/670/666454.pdf.

Further, "experts andstakeholders generally

[have] noted that because the Congress has not agreed on anew path forward for managing spent nuclear fuel since funding was suspended in2010, nor have DOE officials proposed legislation requesting new authority, obtaining specific legislative authority in time to meet DOE's proposed time framesmight be challenging."

Id. In other words, not only does Entergy's spent fuelmanagement plan require congressional action before it can be implemented, but itrequires congressional action that has not yet even been proposed and that would be"challenging" to get passed even if it were proposed.

Id.And even if DOE were to receive legislative approval to site an interimstorage facility, the GAO report lists several other challenges to the actual siting ofsuch a facility.

Id. at 19-37. These include technical challenges to transporting high-burnup fuel (which Vermont Yankee has), as well as the political and societalchallenges that have historically proved insurmountable in past attempts to sitenuclear waste storage facilities at Yucca Mountain and elsewhere.

As the U.S.20 Court of Appeals for the District of Columbia recently held, the societal and political barriers to siting an offsite nuclear waste storage facility require the NRC toanalyze the very real possibility that spent fuel will be stored onsite at plants likeVermont Yankee indefinitely.

See generally New York v. NRC, 681 F.3d 471 (D.C.Cir. 2012). The NRC itself recognized this possibility in its recently issuedContinued Storage Rule, which includes an analysis of onsite spent nuclear fuelstorage under an "indefinite timeframe to address the possibility that a repository never becomes available."

NUREG-2157 at iii. Given the NRC's acknowledgement that spent fuel might be stored onsite at plants like Vermont Yankee indefinitely, the NRC cannot allow Entergy to assume that all fuel will be removed by 2052.Indeed, even Entergy's own Decommissioning Cost Estimate notes a numberof the reasons that spent fuel removal is unlikely to occur by 2052. For instance, Entergy notes that "the country is at an impasse on high-level waste disposal."

Decommissioning Cost Estimate at xiv; id. at § 1, page 5. Further, the prospect ofan interim storage facility-which is a necessary prerequisite to Entergy's spentfuel storage plan-is identified merely as one of the Blue Ribbon Commission onAmerican's Nuclear Future's "recommendations" that "may impactdecommissioning planning."

Id. at xv & § 1, page 6 (emphasis added). And theDecommissioning Cost Estimate candidly admits that Entergy's spent fuel storageplan depends upon "the appropriate authorizations from Congress."

Id. Further,other sections of the Decommissioning Cost Estimate recognize-as Entergy must-that the fuel may not be removed by 2052. For instance, in discussing 21 decommissioning of the diy-cask storage pad and facilities, Entergy notes that thiswill occur "at the time of plant decommissioning or after DOE has removed all spentfuel from the site." Decommissioning Cost Estimate

§ 2, page 6 (emphasis added).Also, as Entergy is well aware, in 2006 the Vermont Public Service Board, inits Docket 7082 Order and Certificate of Public Good, required Entergy to address/the possibility of spent nuclear fuel remaining onsite as long as through 2082. Seehttp://www.state.vt.us/psb/orders/2006/files/7082cpg.pdf.

Entergy's PSDAR fails toexplain why it has chosen to ignore the Order of the Vermont Public Service Boardrequiring an analysis based on spent fuel being onsite for at least 30 years longerthan Entergy assumes in its PSDAR.In short, Entergy's 2052 date for the completion of the removal of spentnuclear fuel is not only unrealistic and dependent on a change to current federallaw, but it is also directly contrary to statements of the Vermont Public ServiceBoard, the NRC, and the U.S. Court of Appeals for the D.C. Circuit.

When theVermont Yankee reactor was licensed in 1972, the Atomic Energy Commission stated that the reactor's spent fuel would be promptly transported to an out-of-state reprocessing facility soon after that fuel was removed from the reactor.

VermontYankee Nuclear Power Station Final EIS at 93-94 (July 1972) (ML061880207).

More than forty years later, none of the spent nuclear fuel has been removed, nor isthere any likely prospect that removal will occur in the near future. Just as theU.S. Court of Appeals for the D.C. Circuit recently forced the NRC to confront thisreality in the context of its Continued Storage Rule, the NRC must confront that22 reality here as well. Indeed, even Entergy candidly admits that, based upon anumber of "performance assumptions,"

it "anticipates" that spent fuel removal"could" be complete by 2052. Decommissioning Cost Estimate at xi. The NRCcannot allow Entergy to make assumptions about what "could" happen, particularly when Entergy is attempting to use those assumptions in related filings to claim analleged "excess" of funds. Any claimed "excess" quickly disappears as soon as theNRC recognizes, as it must, that spent fuel could remain onsite after 2052.4iii. The NRC cannot allow Entergy to assume that site restoration will cost only $57 million.

Because Entergy has chosen to put Vermont Yankeeinto SAFSTOR, the PSDAR provides only general summaries of the non-radiological aspects related to how final site restoration will be achieved.

Further, Entergy's cost estimate of $57 million for site restoration ignores evidence that theDepartment of Public Service has presented to the Vermont Public Service Board inDocket #7862 that a more reasonable estimate for site restoration would equate,adjusted for current 2014 dollars, to around $100 million and could be as high as$133 million once contingencies are taken into account.

And as both the NRC andEntergy have recognized on numerous occasions, the ultimate site restoration standards that apply to Vermont Yankee are a matter of State authority.

Thus, if4 Entergy's claimed "excess" of around $176 million at the end of decommissioning in2076 mostly disappears if Entergy includes the estimated annual expenses of $4 million(and consequent lost interest) for spent fuel management from 2053 to 2076 (rather thanassuming, as Entergy does, that those expenses are "$0"). And even if a small portion ofthat alleged "excess" money still remains in the NDT Fund by 2076, it would not be nearlyenough to pay for ongoing spent fuel management expenses in the future.23 Entergy is going to provide the NRC with estimates about the cost of siterestoration, it should assume that these costs could be as high as $133 million.B. To Ensure Adequate Funding for Decommissioning, the NRCShould Limit Entergy's Use of the Vermont Yankee NDT Fund atThis Time to Activities that Reduce Radiological Contamination As the State recently explained in two letters to NRC Nuclear ReactorRegulation Director William Dean (dated January 26, 2015 and January 27, 2015),the NRC has a statutory duty to ensure that Vermont Yankee's owners andoperators have-and will continue to have-the ability to pay for decommissioning.

The NRC is charged with overseeing each nuclear power plant's NDT Fund toensure that each fund is sufficient to fully decontaminate the site to below theNRC's allowed radiological limits. As the U.S. Court of Appeals for the SeventhCircuit recently held, "[t]he decommissioning of nuclear facilities is closelyregulated by the Nuclear Regulatory Commission, and its regulatory authority embraces every potential malfeasance or misfeasance of assets dedicated to thedecommissioning process."

Pennington

v. Zionsolutions LLC, 742 F.3d 715, 719 (7thCir. 2014) (Posner, J.). As "the designated policeman of decommissioners,"

the NRCis tasked with "assess[ing]

the management of the complex, technologically sophisticated process of nuclear decommissioning."

Id.Entergy's proposed funding approach for decommissioning, spent fuelmanagement, and site restoration is problematic for at least two reasons.

First,applicable NRC regulations do not allow Entergy to use NDT Funds for anythingother than radiological decommissioning.

Those regulations serve an important 24

purpose, and the NRC should not exempt Entergy from those regulations.

Second,the Vermont Yankee NDT Fund is subject to a Master Trust Agreement thatEntergy signed when it purchased Vermont Yankee, and the Master TrustAgreement does not allow Entergy to make the withdrawals it seeks to make.i. NRC regulations limit NDT disbursements to activities that reduceradiological contamination.

Applicable statutes and NRC regulations do notallow Entergy to use NDT Funds for anything other than radiological decommissioning.

Disbursements from the NDT Fund "are restricted todecommissioning expenses."

10 C.F.R. § 50.75(h)(1)(iv).

All withdrawals must be"for legitimate decommissioning activities consistent with the definition ofdecommissioning in [10 C.F.R.] § 50.2." Id. § 50.82(a)(8)(i)(A).

The NRC's definition of "Decommission" is limited to activities that "reduce residual radioactivity."

10C.F.R. § 50.2. As the NRC has made clear, "Decommissioning activities do notinclude the removal and disposal of spent fuel which is considered to be anoperational activity or the removal and disposal of nonradioactive structures andmaterials beyond that necessary to terminate the NRC license."

GeneralRequirements for Decomi missioning Nuclear Facilities, 53 Fed. Reg. 24018-01, 24018(1988). Because decommissioning only includes activities that reduce radiological contamination, it "do[es] not include the cost of demolition and removal ofnoncontaminated structures, storage and shipment of spent fuel, or restoration ofthe site." Id. at 24028.25 The NRC's regulations on the creation and use of NDT Funds explicitly statethat these funds are intended to cover only radiological decontamination necessary for site closure:

"Amounts

[required to be set aside in the NDT Funds] are based onactivities related to the definition of 'Decommission' in § 50.2 of this part and do notinclude the cost of removal and disposal of spent fuel or of nonradioactive structures and materials beyond that necessary to terminate the license."

10 C.F.R. § 50.75n.1. The NRC's regulations on financial qualifications for nuclear decommissioning similarly note that NDT Funds address "only those decommissioning costs incurredby licensees to remove a facility or site safely from service and reduce residualradioactivity,"

which does not include, "for example, the costs of dismantling ordemolishing non-radiological systems and structures."

Standard Review Plan onPower Reactor Licensee Financial Qualifications and Decommissioning FundingAssurance, NUREG-1577, Rev. 1, at 16, § 2(A)(3) (1999). In short, the NRC hasmade abundantly clear that, absent a waiver, only costs that "reduce residualradioactivity" can be withdrawn from the NDT Fund. Standard Review Plan forDecommissioning Cost Estimates for Nuclear Power Reactors, NUREG- 1713, FinalReport, at 4, § (B)(3) (2004).Entergy is well aware of this restriction-hence it has filed its January 6,2015 exemptions request in an attempt to avoid having to comply with long-standing and directly applicable NRC regulations.

Entergy has recently assertedthat the NDT Fund can be used for planning costs associated with spent fuelmanagement, citing NRC Regulatory Guide 1.184. See Letter from T. Michael26 Twomey to Kyle H. Landis-Marinello and Christopher Recchia at 2 & n.7 (Feb. 9,2015). But that very same passage of the NRC regulatory guidance also highlights the general rule that NDT Funds cannot be used for spent fuel management expenses:

[F]unds collected and set aside in the decommissioning trust fordecommissioning are exclusively for radiological decoinmissioning asdefined in 10 CFR 50.2. Therefore, the amount set aside forradiological decommissioning as required by 10 CFR 50.75 should notbe used for: (1) the maintenance and storage of spent fuel in the spentfuel pool, (2) the design, construction, or decommissioning of spent fueldry storage facilities directly related to permanent

disposal, (3) otheractivities not directly related to, radiological decontamination, ordismantlement of the facility or site.NRC Regulatory Guide 1.184 at 6 (emphasis added).ii. The Master Trust Agreement limits NDT disbursements at thistime to activities that reduce radiological contamination.

Just as applicable statutes and regulations place important limitations on what disbursements areallowable from the NDT Fund, the Master Trust Agreement-which Entergy signedwhen it purchased Vermont Yankee-also places limitations on NDT Funddisbursements.

5 The Master Trust Agreement imposes legal restrictions on whenand for what purposes Entergy can withdraw money from the NDT Fund. Suchrestrictions are not surprising given that Vermont ratepayers contributed themajority of the principal funds that currently exist in the NDT Fund-Entergy hasnever contributed any money to that Fund. Rather, Entergy inherited the NDT5 The NRC's approval of the sale of Vermont Yankee explicitly required that the"decommissioning trust agreement must be in a form acceptable to the NRC," including 30-day notice to the NRC before any disbursements.

Order Approving Transfer of License andConforming Amendment, Docket No. 50-271 (May 17, 2002) (ADAMS ML#020390198).

27 Fund-subject to numerous conditions in the Master Trust Agreement-as part ofits purchase of the plant in 2002, and Entergy has never made a payment to theNDT Fund. The Vermont Legislature has directed the Vermont Department ofPublic Service to advocate for prudent use of the ratepayer contributions thatcreated the NDT Fund. See Vt. Stat. Ann. tit. 30, § 2(d). The State has a significant interest in ensuring that this money is spent consistent with NRC regulations andthe terms of the Master Trust Agreement.

The NRC should apply extra scrutiny todisbursements from the Vermont Yankee NDT to ensure that Vermont ratepayer money is spent prudently and appropriately.

Further, Vermont ratepayers have an existing 55% interest in any leftoverfunds. That direct interest is noted in several provisions of the Master TrustAgreement, including Exhibits D and E. The 55% interest is also required undervarious Vermont Public Service Board Orders and Certificates of Public Good thatremain in effect today. When Entergy sought to purchase the Vermont Yankeeplant in 2002, the Vermont Public Service Board approved that sale only upon anumber of conditions, including the return of any excess NDT funds to ratepayers:

"Upon completion of the decommissioning of Vermont Yankee, any propertyremaining in [Entergy's]

Decommissioning Trust funds shall be distributed by theTrustee for the benefits of the customers of Vermont Yankee's sponsors."

Investigation into General Order No. 45 Notice filed by Vermont Yankee NuclearPower Corporation re: proposed sale of Vermont Yankee Nuclear Power Station toEntergy Nuclear Vermont Yankee, LLC, and related transactions, Docket No. 654528 (June 13, 2002) at p.158, available at http://www.state.vt.us/psb/6545.htm, aff'd, Inre Proposed Sale of Vermont Yankee Nuclear Power Station, 829 A.2d 1284 (Vt.2003); see also Entergy's 2002 Certificate of Public Good, Docket No. 6545 (June 13,2002), Condition 2, available at http://www.state.vt.us/psb/6545.htm (same);Entergy's 2014 Amendment to 2002 Certificate of Public Good, Docket No. 7862(Mar. 28, 2014), at p.2, available athttp ://psb.vermont.gov/sites/psb/files/orders/2014/2014-03/7862%20%20CPG%20Amendment.pdf.

As the Vermont Public Service Board noted in a related ruling, "thedisposition of any potential future excess decommissioning funds has expressly beenan issue throughout this proceeding" and was "fully litigated" as part of theproceeding that approved Entergy's purchase of Vermont Yankee. Order re:Motions to Alter or Amend, Enter Final Judgment, and Stay Pending Appeal,Docket No. 6545 (July 30, 2002), at 6 n.17, available athttp://www.state.vt.us/psb/6545.htm.

In fact, the Vermont Public Service Boardrejected a proposal that would have denied Vermont ratepayers their full 55%interest in leftover NDT Funds, finding that such a proposal was inconsistent withratepayer expectations under provisions of the previous decommissioning trust thathad been in place since 1988. Final Order, Docket No. 6545, at 36-38. The VermontPublic Service Board concluded that "these funds were collected from ratepayers fora specific purpose and, if not needed for that purpose, should be returned" toratepayers.

Id. at 152.29 Given their 55% interest in any leftover funds, Vermont ratepayers have adirect interest in ensuring that every disbursement from the NDT Fund complieswith applicable

statutes, regulations, and the Master Trust Agreement.

Vermontratepayers are directly harmed by any money that the Bank of New York Mellonimproperly disburses.

The Master Trust Agreement places numerous restrictions on any use of theNDT Fund. Most importantly, the Master Trust Agreement:

(1) requires that all radiological decontamination and decommissioning becomplete before any money from the NDT Fund can be used for spent fuelmanagement or site restoration 6; and(2) once radiological decontamination and decommissioning is complete, allows withdrawals only for spent fuel management costs that were notrecovered from the Department of Energy.7The "exclusive purpose" of the Master Trust Agreement is "to accumulate andhold funds for the contemplated Decommissioning of the Station and to use suchfunds, in the first instance, for expenses related to the Decommissioning of theStation as defined by the NRC in its Regulations and issuances, and as provided in6 The Master Trust Agreement recognizes that "Decommissioning" may at timesinclude activities that, though not directly reducing radiological contamination bythemselves, are nevertheless necessary to allow radiological decommissioning anddecontamination, such as the removal of spent fuel from the reactor to the spent fuel pool.I Noticeably absent from Entergy's January 6, 2015 exemption request is anyreference to the legally binding Master Trust Agreement or to the fact that Entergy's request seeks to use the NDT Fund to pay for certain expenses that the U.S. Department ofEntergy (DOE) is legally required to undertake.

30 the licenses issued by the NRC for the Station and any amendments thereto."

Master Trust Agreement

§ 2.01 (emphasis added). As discussed above, NRCregulations clearly define decommissioning as activities that reduce radiological contamination, and explicitly exclude expenses such as spent fuel management andsite restoration.

The Master Trust Agreement's "exclusive purpose" is to followthese NRC regulations by ensuring that NDT expenses are used in the firstinstance to reduce radiological contamination.

Thus, the Master Trust Agreement requires that all radiological decontamination and decommissioning be completebefore any money from the NDT Fund can be used for spent fuel management orsite restoration.

Other sections of the Master Trust Agreement similarly require the Bank torefrain from disbursing funds for anything other than radiological decontamination and decommissioning until those activities are complete.

In particular, the MasterTrust Agreement, in several sections, specifically sets up a sequencing ofdisbursements that requires all radiological decontamination and decommissioning activities to be "completed" before any other disbursements are allowed.

MasterTrust Agreement

§ 4.01.Section 4.01 of the Master Trust Agreement, like the applicable NRCregulations discussed above, limits disbursements from the NDT Fund to "payingcosts, liabilities and expenses of Decommissioning or, if so specified, administrative expenses."

The Master Trust Agreement defines "Decommissioning" as "theremoval of the Station from service and disposal of its components in accordance 31 with Applicable Law." Master Trust Agreement

§ 1.01(j).

Only "[o]nceDecommissioning is completed" can the Bank release NDT Funds to Entergy foruncovered "Spent Fuel Costs and Site Restoration Costs." Id. § 4.01 (emphasis added).8This sequencing is explained further by Exhibit D of the Master TrustAgreement.

Exhibit D-labeled "Decommissioning Requirements"-explicitly defines the "Completion of Decommissioning" as "plant dismantlement anddecontamination to NRC standards plus the completion of additional activities agreed to or imposed in the course of [the sale docket] before the Vermont PublicService Commission or pursuant to any subsequent law or proceeding, but excluding spent fuel management and any site restoration."

Master Trust Agreement Ex. D(emphasis added). In other words, spent fuel management and site restoration expenses could be recovered from the NDT Fund only if they occurred after thecompletion of radiological decommissioning.

And even then, the NDT Fund can only be used to cover expenses that theU.S. Department of Energy (DOE) does not have to pay. The Master TrustAgreement was signed in 2002. At that point, four years after DOE breached itss Although Entergy notes that section 4.01 refers to spent fuel and site restoration costs "to the extent not included in Decommissioning,"

that parenthetical statement doesnot mean that the Master Trust Agreement's definition of "Decommissioning" includes allsuch costs. First, the language "to the extent not included" implies that there are spent fuelcosts that are not included in "Decommissioning."

Further, as noted in detail below, thedefinition of "Decommissioning" in the Master Trust Agreement states that it includes"non-DOE spent fuel storage" expenses incurred during "pre-shutdown activities."

MasterTrust Agreement

§ 1.01(j).

Those limitations cannot be reconciled with Entergy's apparentposition that "Decommissioning" includes all costs of spent fuel management during thepost-closure period.32 contractual obligation to remove spent nuclear fuel from nuclear sites such asVermont Yankee, it was clear that Entergy would have the ability to sue DOE forspent fuel management expenses.

In fact, the Purchase and Sale Agreement forVermont Yankee explicitly transferred all rights to such lawsuits, and Entergy hassince recovered tens of millions of dollars from DOE for spent fuel management expenses that would not have occurred had DOE removed the fuel in 1998.*The continuation of these lawsuits was anticipated by the Master TrustAgreement, which set up a process to ensure that Entergy did not double recover forspent fuel management expenses by using NDT Funds for expenses that it wouldlater recover from DOE through litigation.

In particular, the definition of"Decommissioning" in the Master Trust Agreement states that it includes "non-DOE spent fuel storage."

Master Trust Agreement

§ 1.01) (emphasis added).Similarly, Exhibit D of the Master Trust Agreement sets up the following provision to address the "return of excess funds" from the NDT-a provision that clearlyrequires Entergy to obtain all possible relief from DOE before it attempts to useNDT Funds for spent fuel management expenses:

Return of Excess Funds in accordance with the second following paragraph, shall occur following the earliest of (i) the date Completion ofDecommissioning has occurred and the Company has satisfied all of itsresponsibilities for spent fuel management and site restoration or(ii) the date on which Completion of Decommissioning occurs and any ofthe following occur: (x) settlement between the Company and the USDepartment of Energy ("DOE") with respect to spent fuel management responsibilities for the Station, (y) final resolution of litigation by theCompany against DOE with respect to spent fuel management responsibilities for the Station, or (z) satisfactory performance by DOE ofits spent fuel responsibility with respect to the Station.33 Master Trust Agreement Ex. D (emphasis added). Exhibit D then notes that"excess funds" excludes costs "not otherwise payable by the federal government inaccordance with (x), (y) or (z) above."Section 5.02 of the Master Trust Agreement similarly notes that it is "upontermination of this Master Trust or such Funds, [that] the Trustee shall distribute all funds necessary for Spent Fuel Costs and Site Restoration Costs to theCompany."

That is because, as NRC regulations

require, the NDT Fund must coverall necessary radiological decontamination and decommissioning expenses beforeany disbursements can be made to cover other expenses such as spent fuelmanagement and site restoration.

That sequencing is the only way to ensure, asthe NRC must do, that Entergy maintains sufficient funds to radiologically decontaminate the site.The sequencing mentioned above is also required by the Master TrustAgreement-for the same safety reasons that the NRC requires it, but also becauseVermont ratepayers have a direct interest in all excess funds. In particular, asmentioned above, Vermont ratepayers will obtain 55% of all excess funds from theNDT Fund. Thus, the Master Trust Agreement contains numerous provisions toensure proper care of these funds by Entergy and the Bank of New York Mellon-including, for instance, the requirement that Entergy not spend any NDT Funds onexpenses that DOE is legally required to undertake.

34 While Entergy's February 9, 2015 letter attempts to assert a different interpretation of the Master Trust Agreement, Entergy's position is untenable andin fact demonstrates why the NRC cannot allow Entergy to withdraw NDT Fundsfor spent fuel management during the post-closure period before radiological decommissioning is complete.

For instance, Entergy claims that Exhibit D of theMaster Trust Agreement should effectively be ignored since it only addresses the"Completion of Decommissioning" and not the ability of the Bank to disburse fundsfor decommissioning itself. Entergy Feb. 9, 2015 Letter at 3. Yet, as discussed above, section 4.01, which governs distributions by the trustee, contains limits andsequencing of payments consistent with Exhibit D.Entergy also asserts that only "FERC has the authority to determine thedisposition of any excess trust funds." Id. at 4. If anything, FERC regulations provide yet another reason why the Master Trust Agreement must be interpreted aslimiting initial NDT Fund expenditures in the post-closure period todecommissioning activities as defined by NRC regulations, since Entergy does nothave FERC approval to use the NDT Fund for anything other than radiological decommissioning:

"Absent express authorization of [FERC], no part of the assets ofthe [NDT] Fund may be used for, or diverted to, any purpose other than to fund thecosts of decommissioning the nuclear power plant to which the Fund relates, and topay administrative costs and other incidental

expenses, including taxes, of theFund." 18 C.F.R. § 35.32(6)

(emphasis added). Thus, as both NRC and FERCregulations

require, it is only once decommissioning activities are complete (and35 thus NRC oversight complete) that excess funds can be used for other purposes, such as spent fuel management.

Also, Entergy's argument ignores FERC's approvalof the 2002 sale and transfer of the NDT Fund. See Vermont Yankee Nuclear PowerCorp. et al., 98 FERC ¶ 61,122, order on reh'g, 98 FERC ¶ 61,358; see also NewEngland Coalition

v. Vermont Yankee Nuclear Power Corp., 101 FERC ¶ 61,239.For these and other reasons, the NRC should reject all aspects of Entergy's proposed PSDAR and related filings, including its January 6, 2015 exemptions

request, insofar as Entergy seeks permission to spend NDT Funds at this time onanything other than reducing radiological contamination at the site. At aminimum, this means the following:

(1) The NRC should reject all requests by Entergy to use the Vermont YankeeNDT Fund for spent fuel management expenses during the post-closure period before radiological decommissioning is complete.

This wouldinclude rejecting Entergy's January 6, 2015 exemptions

request, as well asEntergy's December 19, 2014 Updated Irradiated Fuel Management, Updated Decommissioning Funding Status Report, and proposed PSDARand Decommissioning Cost Estimate insofar as those documents rely onusing the Vermont Yankee NDT Fund for spent fuel management expenses before radiological decommissioning is complete.

The NRCshould then require Entergy to submit revised filings of its December 19,2014 filings, including a revised plan for spent fuel management expensesthat is consistent with the requirements of 10 C.F.R. § 50.54bb.36 (2) The NRC should analyze Appendix C of Entergy's Decommissioning CostEstimate and prohibit Entergy from withdrawing money from theVermont Yankee NDT Fund for all items that fail to meet the NRC'sdefinition of decommissioning, including, at a minimum, the following:

a. The $5 million payment (lines la.2.22 & lb.2.22) that Entergy ismaking to the State as part of the Settlement Agreement;

b. Emergency preparedness costs (e.g., line la.2.23)9;c. Shipments of non-radiological asbestos waste (e.g., line la.2.27);

d. Insurance (e.g., line la.4.1);e. Property taxes (e.g., line la.4.2);f. Replacement of structures during SAFSTOR (e.g., line 2b. 1.4);g. Any costs associated with offsite buildings that are notradiologically contaminated; andh. All other listed costs that relate to activities that do not reduceradiological contamination.

9 Expenses for emergency preparedness do not reduce radiological contamination atthe site and are thus not proper uses of the NDT Fund. Entergy would therefore need anexemption (which has neither been requested nor granted) before it could withdraw NDTFunds for emergency preparedness expenses.

Nevertheless, in addition to listingemergency planning as a license termination expense in Appendix C of its Decommissioning Cost Estimate, an Entergy spokesperson recently stated that Entergy intends to use NDTFunds not only for emergency preparedness

measures, but also for "any legal costs"resulting from the State's challenges to Entergy's planned reductions in emergency preparedness.

VTDigger.org, State Appeals Decision on Vermont Yankee Monitoring, http://vtdigger.org/2015/02/26/state-appeals-decision-on-vermont-yankee-emergency-monitoring/

(emphasis added). According to the Entergy spokesperson, these legal costs are"'part of our decommission costs,' he said. 'This is money that's going to be coming fromtrust fund."' Entergy's reasoning was that "[b]ecause the plant is no longer generating

revenue,

[the Entergy spokesperson]

said any legal costs the company incurs will come outof the decommissioning trust fund." Id. The NRC cannot allow that to happen.37 (3) The NRC should request that Entergy explain, in light of its merchant-generator status, how Entergy will fund items such as those listed above,as well as costs that are not currently listed in its Decommissioning CostEstimate, such as employee pension fund liabilities.

Entergy's ability orinability to fund such liabilities bears directly on Entergy's ability to fundradiological decommissioning expenses should those expenses turn out tobe larger than anticipated.

Entergy erroneously places all projected costsinto three categories:

NRC License Termination costs, Spent FuelManagement costs, and Site Restoration costs. The NRC should makeclear that certain costs, such as those noted above, fall outside of thesethree categories, and the NRC should ask Entergy to add a fourthcategory for those costs. In addition to those items listed above, thisfourth category would also contain expenses such as Entergy's "NEIAnnual Fee" (e.g., line la.2.38 of Appendix C). Further, the NRC shouldrequire Entergy to revise some of those costs. For instance, Entergystates in Appendix C of its Decommissioning Cost Estimate that it expectsto pay only around $7,000 per year in property taxes beginning in 2020(e.g., lines 2aa.4.2 & 2b.4.2).

This is incorrect.

Although Entergy notesthat its payments under the generation tax will "cease once the plant ispermanently shutdown" (Decommissioning Cost Estimate

§ 3, page 18),Entergy fails to account for the fact that the generation tax is the basis forEntergy's current exemption from otherwise applicable state property38 taxes. Entergy has no basis for assuming that its current exemption fromthose taxes will continue once the generation tax ceases to providerevenue to the State of Vermont.

Entergy similarly has no basis for itsclaim that local authorities will tax Vermont Yankee "as vacant land."Decommissioning Cost Estimate

§ 3, page 18. Entergy has not explained how it will pay for any higher property taxes that may apply either at thestate or local level.(4) The NRC should take all other actions necessary to protect the money inthe NDT Fund until radiological decommissioning is complete.

See, e.g.,10 C.F.R. § 50.82(a)(8)(i)(A)

(requiring that all withdrawals from NDTFunds must be "for legitimate decommissioning activities consistent withthe definition of decommissioning in [10 C.F.R.] § 50.2"); Master TrustAgreement

§ 2.01 (stating that the "exclusive purpose" of the MasterTrust Agreement is "to accumulate and hold funds for the contemplated Decommissioning of the Station and to use such funds, in the firstinstance, for expenses related to the Decommissioning of the Station asdefined by the NRC in its Regulations and issuances, and as provided inthe licenses issued by the NRC for the Station and any amendments thereto" (emphasis added)).39 III. In Accordance with the National Environmental Policy Act, the NRCMust Analyze the Environmental Impacts of Entergy's ProposedPSDAR and Related FilingsThe National Environmental Policy Act (NEPA) requires federal agencies toprepare "a detailed statement..,

on the environmental impact" of any proposedmajor federal action "significantly affecting the quality of the human environment."

42 U.S.C. § 4332(1)(C)(i);

see generally 42 U.S.C. §§ 4321 et seq. At a minimum, ifan agency is going to allow a licensee to engage in activities with environmental impacts without the agency first issuing a detailed environmental impactstatement, the agency must do an environmental analysis and issue a "finding of nosignificant impact" (FONSI).

40 C. F. R. § 1501.4; id. § 1508.14.The requirements of NEPA apply not only to affirmative actions by an agency(such as a licensing decision),

but also to actions of a licensee that "are potentially subject to Federal control and responsibility,"

such as the PSDAR. Id. § 1508.18(emphasis added). "Actions include the circumstance where the responsible officials fail to act and that failure to act is reviewable by courts or administrative tribunals under the Administrative Procedure Act or other applicable law as agency action."Id. Under the Administrative Procedure Act, the requirements of NEPA applyequally to an agency's actions as to an agency's "failure to act." 5 U.S.C. § 551(13).Thus, although the NRC takes the position that it need not formally approve aPSDAR, it nevertheless has duties under NEPA to review the environmental impacts of decommissioning plans. NEPA responsibilities are triggered by the factthat a federal agency "has actual power to control the project."

Ross v. Fed.40 Highway Admin., 162 F.3d 1046, 1051 (10th Cir. 1998). Here, there is no doubtthat the NRC has authority over the decommissioning of nuclear power plants, andthe NRC itself has explicitly recognized its authority to "find the PSDAR deficient."

NRC Regulatory Guide 1.185, Standard Format and Content for Post-Shutdown Decommissioning Activities Report at 10 (June 2013).At least one federal circuit court of appeals has already made clear that"[r]egardless of the label the [Nuclear Regulatory]

Commission places on itsdecision,"

the act of "permitting

[a licensee]

to decommission the facility" requiresNEPA review: "An agency cannot skirt NEPA or other statutory commands byessentially exempting a licensee from regulatory compliance, and then simplylabelling its decision

'mere oversight' rather than a major federal action. To do so ismanifestly arbitrary and capricious."

Citizens Awareness

Network, Inc. v. NuclearRegulatory Comm 'n, 59 F.3d 284, 293 (1st Cir. 1995). Another federal circuit courtof appeals has similarly held in an analogous situation that when a federal agencyhas a "mandatory obligation to review" plans, the agency's "failure to disapprove" ofthose plans constitutes "major federal action" triggering NEPA review. Ramsey v.Kantor, 96 F.3d 434, 445 (9th Cir. 1996).The required NEPA analysis must be comprehensive and address all"potential environmental effects" unless those effects are so unlikely as to be"remote and highly speculative."

San Luis Obispo Mothers for Peace v. NuclearRegulatory Comm'n, 449 F.3d 1016, 1030 (9th Cir. 2006). Potential environmental 41 impacts from the storage of spent nuclear fuel include impacts resulting from "thepossibility of terrorist attack."

Id. at 1031.Before the NRC allows Entergy to proceed with decommissioning, the NRCmust perform the required NEPA analysis of potential environmental impactsassociated with Entergy's specific PSDAR and related filings.

This wouldnecessarily include analyzing the environmental and economic impacts of thePSDAR's election of the maximum SAFSTOR period.A comprehensive analysis is required here in part to avoid segmenting environmental analyses into discrete parts without ever looking at their fullcombined effects-an approach that NEPA does not allow. See e.g. Del. Riverkeeper Network u. FERC, 753 F.3d 1304, 1314 (D.C. Cir. 2014) ("The justification for therule against segmentation is obvious:

it prevents agencies from dividing one projectinto multiple individual actions each of which individually has an insignificant environmental impact, but which collectively have a substantial impact."

(quotation and alteration marks omitted));

see also, e.g., NRDC v. Callaway, 524 F.2d 79, 88(2d Cir. 1975) (NEPA is meant to provide "a more comprehensive approach so thatlong term and cumulative effects of small and unrelated decisions could berecognized, evaluated and either avoided, mitigated, or accepted as the price to bepaid for the major federal action under consideration" (emphasis added)).

The NRChas previously underscored the value of a comprehensive NEPA analysis:

"WhileNEPA does not require agencies to select particular

options, it is intended to fosterboth informed decision-making and informed public participation, and thus to42 ensure that the agency does not act upon incomplete information, only to regret itsdecision after it is too late to correct."

In Re Duke Energy Corporation (McGuireNuclear Station, Units 1 and 2; Catawba Nuclear Station, Units and 2-), CLI-02-17, 56 N.R.C. 1, 10 (2002).In short, NEPA does not allow the NRC to permit Entergy to proceed with itsdecommissioning activities without further analysis by the NRC of the potential environmental impacts of those activities.

The PSDAR as it currently stands isinsufficient to identify and assess the site-specific environmental impacts ofEntergy's decommissioning activities to facilitate proper planning.

The processoutlined in NRC Regulatory Guide 1.185 requires a conclusion to be made based oncomparison to pre-defined and generic environmental impacts that may or may notbe applicable to all nuclear power plants. Additionally, the range of environmental impacts addressed by Entergy's PSDAR does not include environmental impactsassociated with non-radiological contaminants and the generation and storage ofnon-radiological wastes. Thus, the PSDAR fails to provide sufficient information toallow the NRC, the State, and the public to assess all of the environmental impactsassociated with Entergy's decommissioning activities.

While it is the State's position that a full NEPA analysis is required herebefore the NRC can allow Entergy to proceed with decommissioning, Entergy's PSDAR is also deficient because it incorrectly claims that all environmental impactsare "bounded" by previously issued environmental impact statements.

See PSDAR§ 5; 10 C.F.R. § 50.82(a)(4)(i);

NRC Regulatory Guide 1.185. As an initial matter,43 while Entergy states that it "has concluded that the environmental impactsassociated with planned VYNPS site-specific decommissioning activities" arebounded by previous environmental impact statements (PSDAR at 22), it is ofcourse the NRC, not Entergy, that is the entity legally responsible for compliance with the National Environmental Policy Act.Further, Entergy does not and cannot support its "bounding" claim. Entergyattempts to show "bounding" by citing three documents issued between the years1997 and 2007: the 1997 Generic Environmental Impact Statement in Support ofRulemaking on Radiological Criteria for License Termination of NRC-Licensed Nuclear Facilities (NUREG-1496);

the 2002 Final Generic Environmental ImpactStatement on Decommissioning of Nuclear Facilities (NUREG-0586);

and the 2007Generic Environmental Impact Statement for License Renewal of Nuclear Plants,Supplement 30, Regarding Vermont Yankee Nuclear Power Station (NUREG-1437, Supplement 30).Those three documents, the most recent of which is now eight years old, donot "bound" all of the environmental impacts associated with decommissioning thisspecific plant under the specific PSDAR that Entergy has just submitted.

Entergyasserts-without citation to any scientific or environmental

reports, studies, oranalyses-that because Vermont Yankee "is smaller than the reference boilingwater reactor used in the [2002 Decommissioning]

GEIS ... [it] is therefore bounded by those assessments."

PSDAR at 22. But Entergy has provided noscientific basis for concluding that the size of a plant is the exclusive factor for44 determining its potential environmental and other impacts duringdecommissioning.

To the contrary, regardless of a plant's size, other site-specific factors can-and do-affect the potential environmental and other impacts of decommissioning.

For instance, Vermont Yankee has an operating elementary school located just 1500feet from the reactor building.

The 2002 Decommissioning GEIS never took thatsite-specific factor into account.

The 2007 Supplemental GEIS also failed to take itinto account.

In fact, the 2007 Supplemental GEIS does not appear to haveaddressed any site-specific factors atVermont Yankee, concluding instead that"there are no impacts related to these issues beyond those discussed in the [2002Decommissioning]

GEIS." NUREG-1437, Supplement 30, at 7-2.The close proximity of an operating elementary school cannot be ignored.

Ata minimum, this factor calls for imposing common-sense mitigation measures thatensure that schoolchildren are not present during certain decommissioning activities, such as the transfer of spent nuclear fuel or the demolition of buildings containing radioactive or non-radiological hazardous materials like asbestos andlead.'0 It is well known that young children are more vulnerable to adverse healthreactions to airborne contaminants such as lead. See, e.g., Vermont Dept. of Health,Lead Poisoning and Prevention, http://healthvermont.gov/enviro/lead/

("Young10 Despite specific requests for such information by the Department of Health andthe Agency of Natural Resources in the December 2014 comments that the State providedto Entergy, the PSDAR is silent on the presence and eventual disposition of asbestos-containing materials and lead-based paint, and Entergy has failed to provide this requested information to either the Department of Health or the Agency of Natural Resources.

45 children are at highest risk because their developing bodies absorb lead more easily.Lead dust exposure can have life-long health effects such as lowering a child's IQ.").Thus, in contrast to Entergy's "bounding" claim, a decommissioning activitysuch as the demolition of a building that contains lead (and the lead dust createdfrom that) might have minimal or no environmental impacts at a larger plant in anisolated area, but significant consequences at Vermont Yankee if even a smallamount of lead dust travels the short distance between the plant and the nearbyelementary school. Entergy's PSDAR therefore fails to show that theseenvironmental impacts are bounded by previous analyses.

The failure of Energy's PSDAR to address an issue such as lead dust isparticularly problematic in light of the NRC's regulatory guidance requiring theconsideration of "impacts from non-radiological

hazards, such as dust, noise, wateruse, and hazardous (non-radiological) waste." NRC Regulatory Guide 1.185 at 9(emphasis added).More generally, the PSDAR's limited discussion of non-radiological hazards isdeficient.

Neither the PSDAR nor the October 2014 Site Assessment Studyacknowledges or specifies a plan or schedule for ensuring compliance withVermont's hazardous waste generator closure requirements, outlined in Section 7-309(c) of the Vermont Hazardous Waste Management Regulations.

In order for itsactivities to comply with state laws, including Agency of Natural Resources regulations, Entergy must submit a plan for closure of the site that includes closureof all non-radiological hazardous waste handling and storage areas on site in a46 manner that minimizes the need for further maintenance and that appropriately minimizes or eliminates post-closure escape of non-radiological hazardous wasteand hazardous constituents to the groundwater and atmosphere, as requested bythe Agency in its response to Entergy's October 2014 Site Assessment Study. Todate, Entergy has not done so.Another factor that is clearly not bounded by previous environmental analyses is the potential for environmental impacts associated with the storage ofspent nuclear fuel. Entergy's PSDAR for Vermont Yankee raises numerousenvironmental, safety, and other impacts related to spent fuel storage that are notaddressed by any of the environmental analyses that Entergy cites. In fact, the2002 Decommissioning GEIS did not analyze any environmental, safety, or otherimpacts related to spent fuel storage, but rather explicitly relied on the NRC'sWaste Confidence Decision-a decision that has since been vacated by the U.S.Court of Appeals for the D.C. Circuit.

See New York v. NRC I, 681 F.3d 471 (D.C.Cir. 2012). Similarly, the 2007 GEIS for Vermont Yankee explicitly relied on thenow-vacated Waste Confidence Decision and noted that the 2007 analysis was"based upon the assumption that storage of the spent fuel onsite is not permanent."

NUREG-1437, Supplement 30, A-146.Entergy's PSDAR also makes reference to the NRC's recently issuedContinued Storage Rule (NUREG-2157),

noting that this Rule "found that thegeneric environmental impacts of ongoing spent fuel storage are small." PSDAR at36. Entergy fails to mention that this Rule has been directly challenged by the47 State of Vermont and others in a current proceeding in the U.S. Court of Appeals forthe D.C. Circuit (New York v. NRC IH).Further, Entergy's reliance on the Continued Storage Rule requires Entergyto address the NRC's explicit recognition in that Rule that spent fuel may be storedindefinitely at each reactor site, and the assumption that, in that scenario, eachreactor operator will need a Dry Fuel Transfer Station to move spent fuel into newdry casks every 100 years. Entergy's PSDAR is deficient because it fails to explainhow it would address the contingency of indefinite onsite storage, including allsafety and environmental concerns regarding transferring fuel into new dry casksevery 100 years. Entergy's PSDAR, Decommissioning Cost Estimate, and relatedfilings are also deficient because they fail to identify any funding source for: (a) theconstruction of a Dry Fuel Transfer Station; (b) the purchase of 58 new casks andall other labor and material costs for transferring the fuel every 100 years; and(c) the costs of maintaining security at the site indefinitely.

Other factors at this particular nuclear power plant that are clearly notbounded by previous environmental analyses include:-Recreational activities take place on the Connecticut River bordering theplant.-In addition to what Entergy identifies as currently endangered andthreatened

species, over the next 60 years it is likely that the list ofendangered and threatened species will increase due to human activity, climate change, and other factors.48

-Indeed, science's increased understanding of climate change-and itsensuing weather events-is an independent factor that the NRC needs toaddress to properly evaluate the potential environmental impacts ofEntergy's current plan to decommission Vermont Yankee. For instance, given this plant's proximity to the Connecticut River, the NRC needs toevaluate whether the current standard for nuclear power plant ExternalFlood evaluations is outdated.

The current standard only looks at the 100-year flood plain. Neither Entergy nor the NRC has provided any explanation for why a 100-year flood plain (rather than a 500- or 1,000-year flood plain)suffices in light of our current scientific understanding of climate change-an understanding that was not available during previous environmental analyses.

This is particularly true with regard to issues such as placement ofthe dry-cask storage pad, given that, as the NRC recently recognized in itsContinued Storage Rule, spent nuclear fuel could be stored onsite for 500 or1,000 years, or even longer.-There is known and unknown contamination at Vermont Yankee firompreviously identified tritium leaks and the more recently identified presenceof strontium-90.

The NRC should require Entergy to address theenvironmental and other effects of any delay during the SAFSTOR period inaddressing such leaks, including the well-known fact that migration willincrease the area that is contaminated.

49

-There are unique environmental and economic impacts related to thelength of any SAFSTOR period, and numerous reasonable alternatives (eachwith unique environmental and economic impacts) to the SAFSTOR periodthat Entergy has elected.

Neither the NRC nor Entergy has ever taken intoaccount that, for this particular nuclear power plant, there are negativeeconomic impacts to the surrounding area resulting from Entergy's decisionto use the maximum SAFSTOR period rather than a shorter SAFSTOR.Regulations implementing NEPA (such as 40 C.F.R. § 1508.8) require theNRC to analyze the economic impacts of major federal actions significantly affecting the environment.

Neither the NRC nor Entergy has ever done suchan analysis, which would require, among other things, accounting for theeconomic costs of leaving the plant dormant (taking up space that couldotherwise be used productively),

as well as 60 years of downward pressure onproperty values and area development due to hesitancy to invest in an areathat is slated for a major industrial deconstruction project (with attending noise, aesthetic, and other concerns).

This analysis is required by federallaw, and Entergy cannot proceed with its decommissioning plans until suchan analysis is performed.

-Because Vermont Yankee is owned by a merchant generator (rather than aregulated utility),

Entergy cannot go back to ratepayers if it hasunderestimated the costs of decommissioning, spent fuel management, or siterestoration.

The lack of a guaranteed ratepayer base raises numerous thus-50 far-unanalyzed environmental

concerns, including the possibility that certaindecommissioning or site restoration activities will not occur due to lack offunding.-Entergy's PSDAR announces for the first time that an estimated 1.3 milliongallons of highly radioactive water will be stored in the torus within thereactor building during decades of SAFSTOR.

Given that it was not until thePSDAR that Entergy revealed plans to deal with this radioactive water inthis manner, this issue raises environmental issues that are obviously not"bounded" by any previous environmental analysis.

Nor has Entergy pointedto any previous analysis addressing potential environmental impactsassociated with storing radioactive water in this manner. The Department ofHealth is concerned that Entergy has not yet identified what instrumentation will be used to monitor torus water levels in the PSDAR. Entergy should alsodescribe what kind of inspection regimen for possible leakage will be useduntil this water is properly disposed of as radioactive waste. Further,Entergy should explain in the PSDAR when disposal of this water will occurand how.The PSDAR is also inadequate in terms of its environmental analysis relatedto the need for extensive groundwater monitoring.

To protect public health, safety,and the environment, Entergy must extensively monitor groundwater untildecommissioning is complete and its license has been terminated.

After tritiumcontamination was measured in groundwater at many nuclear power plants, the51 Nuclear Energy Institute developed the Groundwater Protection Initiative (NEITechnical Report 07-07). Throughout the different phases of decommissioning, Entergy should, at a minimum, maintain its current monitoring levels as requiredby NEI 07-07 at the Vermont Yankee facility until NRC license termination.

This isnecessary since radioactive materials will remain in storage for decades beforedecontamination and dismantling.

It is particularly important in light of theDepartment of Health's recent identification of strontium-90 in groundwater.

The recent discovery of strontium-90 in groundwater raises additional concerns regarding soil contamination that may enter the groundwater and move ina way that threatens public health, safety, and the environment.

This includescontamination from previously mentioned long half-life radioactive materials, aswell as shorter half-life materials in the soils at Vermont Yankee. For instance, cobalt-60, cesium-134, zinc-65, and manganese-54 have been all been documented insoils and as sources in previously investigated leaks at Vermont Yankee. See SiteAssessment Study; Department of Health, Laboratory analyses for soil samplescollected March 17, 2010 at locations along the Vermont Yankee Advanced Off-GasPipe Tunnel leak pathway, available athttp://healthvermont.gov/enviro/rad/yankee/documents/VYDatasoilsamples-mar ch2010.pdf.

Despite the clear need for robust environmental monitoring until licensetermination, the PSDAR is mostly silent on this subject.

For protection of theenvironment and public health, monthly sampling from all 32 groundwater 52 monitoring wells and all three drinking water wells currently sampled at VermontYankee should continue through license termination, and split samples from thosewells should be provided to the Vermont Department of Health for independent confirmatory analysis.

In addition, Entergy should continue to perform radiological environmental monitoring of the pathways to the public, direct gamma radiation, soils, sediments, fish and other flora and fauna as conducted during operation of thefacility until the large volume of radioactive materials stored onsite are removed bydecontamination, dismantling, and licensed disposal.

Along with those samples currently split with the Department of Health,including onsite groundwater and drinking water, sediments and fish from theConnecticut River, and direct gamma radiation measurements by dosimeter, theState of Vermont must be provided split samples from the final status surveys thatare intended to document that soil and structure remediation will allow release ofthe site for unrestricted use at NRC license termination.

The PSDAR fails toinclude any such requirement and is thus deficient in this regard.Further, as noted in Section V.B below, the PSDAR provides an inadequate environmental analysis of potential impacts from a radiological incident.

In summary, it is indisputable that there are many environmental impactsrelated to decommissioning, and the PSDAR does not analyze those impacts in themanner required by NEPA and other applicable statutes and regulations.

It is theState's position that the NRC must engage in a full NEPA analysis of those impactsbefore allowing Entergy to proceed with decommissioning.

Even if the NRC53 disagrees with that position, then, at a minimum, the NRC must evaluate thePSDAR for compliance with 10 C.F.R. § 50.92, which requires a supplemental environmental impact statement in situations such as this where new information has not previously been analyzed.

See also, e.g., Marsh v. Oregon Natural Res.Council, 490 U.S. 360, 374 (1989) (noting that when an agency receives new andsignificant information casting doubt on a previously issued environmental

analysis, the agency must reevaluate the earlier analysis).

At a minimum, the NRCshould require the PSDAR to list all of the environmental impacts related todecommissioning and identify where each one has been evaluated in anothercontext.

Entergy has not done so. Nor could it do so, as many of these impacts havenot been previously evaluated.

Consequently, further environmental analysis isneeded before the NRC allows Entergy to proceed with decommissioning.

IV. The NRC Should Require Entergy to Revise Its Analyses Regarding theEmergency Planning ZoneEntergy's decommissioning plans, including its Decommissioning CostEstimate and the environmental analysis contained in its PSDAR, seem to assumethat Entergy will obtain a number of exemptions requests and License Amendment Requests related to emergency management.

See, e.g., Decommissioing CostEstimate

§ 3, page 17 (noting that "fees associated with emergency planning areassumed to continue through 2016" at which point "the fees are discontinued").

Atleast two of those requests-a license amendment that would discontinue theEmergency Response Data System (ERDS), and a license amendment that wouldreduce the Emergency Planning Zone (EPZ)-are being actively challenged by the54 State of Vermont.

Unless and until those legal challenges have been resolved, Entergy cannot go forward with a decommissioning plan that assumes that theselicense amendments will be allowed.A. Entergy Cannot Assume a Reduced Emergency Planning ZoneThe State of Vermont has filed extensive comments and submitted a requestfor a hearing regarding Entergy's license amendment request to reduce theEmergency Planning Zone. Those comments, provided by three separate Stateagencies, are attached-and expressly incorporated into-these Comments.

SeeExhibit 5. The attached comments explain why the NRC should not allow Entergyto reduce the Emergency Planning Zone in the way Entergy has requested.

B. Even If Entergy Could Assume a Reduced Emergency PlanningZone, That Assumption Would Require Additional Environmental Analyses to Comply with the National Environmental Policy Actand NRC Regulations Entergy's PSDAR claims-without citation-that "emergency plans andprocedures will remain in place to protect the health and safety of the public whilethe possibility of significant radiological releases exists."

PSDAR at 29. On thisbasis, Entergy "concludes that the impacts of [Vermont Yankee] decommissioning on radiological accidents are small and are bounded by the previously issued GEIS."Id. This analysis is flawed for several reasons.To begin, Entergy's current plans with regard to the Emergency PlanningZone were not available-and thus could not have been analyzed-until Entergyannounced those plans through various detailed requests for exemptions andLicense Amendment Requests filed within the last year. Those detailed plans are55 clearly not bounded by documents from 1997, 2002, and 2007, which were developed many years before Entergy's recently announced plans. Indeed, as noted above,what plans Entergy will actually be allowed to implement is currently an openquestion and will remain so until the current ERDS and EPZ litigation is complete.

A significant part of that litigation relates directly to the State's arguments thatEntergy's plan to reduce the Emergency Planning Zone exposes the State and itscitizens to unacceptable potential environmental and health impacts.

See generally Exhibit 4. Entergy cannot seriously claim that documents firom 1997, 2002, and2007 "bound" the potential environmental impacts of plans that were neverprovided between 1997 and 2007 and that remain uncertain to date because theyare the subject of active litigation.

In fact, the 2007 GEIS for Vermont Yankee explicitly disclaimed anyenvironmental analysis of emergency management:

"the Commission hasdetermined that there is no need for a special review of emergency planning issuesin the context of an environmental review for license renewal."

NUREG-1437, Supplement 30, A-213 to A-214. The NRC's rationale was that "[o]ffsite entitiessuch as State and local governments and the U.S. Federal Emergency Management Agency have responsibility for offsite emergency planning" and any "[p]erceived deficiencies

... in the offsite emergency plans should be directed to the government entities that have responsibility for the specific portions of the plan judged to bedeficient."

Id. at A-214. In other words, the NRC refused to do the requisite environmental analysis because other agencies, including "State and local56 governments" were responsible for offsite emergency planning.

Yet Entergy hasnow proceeded with at least two actions related to emergency management-disconnection of the ERDS notification system, and reduction of the EPZ-that areexpressly opposed by the State of Vermont and that threaten to diminish the State'sability to meet its emergency planning obligations.

Entergy and the NRC cannot have it both ways. If Entergy and the NRC aregoing to make emergency management decisions that are opposed by the State ofVermont, they cannot claim that such decisions are "bounded" by an environmental analysis that relied on State authority over these important matters.Further, the PSDAR has clear inadequacies regarding issues such asradiological spill control during dewatering operations.

The PSDAR contains astatement that one of the processes for placing the plant in SAFSTOR is"[p]rocessing and disposal of water and water filter and treatment media notrequired to support dormancy."

PSDAR page 10. These activities present asignificant risk for release to the environment.

Yet there is inadequate evidence inthe PSDAR that these activities are well-planned and that sufficient staff will beemployed to prevent accidents.

The PSDAR also inadequately describes what fire protection systems will bein place at Vermont Yankee. Throughout every stage of decommissioning, largequantities of radioactive material will exist within the remaining structures,

systems, and components until they are decontaminated and dismantled.

In theevent of a fire, these materials may result in radioactive contamination of, and57 radiation doses to, firefighters and other first responders.

Consumption by fire ofradioactive materials may also result in offsite contamination.

No evidence isprovided in the PSDAR that local fire department personnel are fully prepared foronsite firefighting with limited support offered by reduced staff at Vermont Yankee.There is also no evidence in the PSDAR as to how offsite responders can manageoffsite contamination that results from fires that consume radioactive materials stored onsite.The PSDAR claims that the 2002 Decommissioning GEIS "assessed the rangeof possible radiological accidents during decommissioning" and that "the risk atspent fuel pools is low and well within the NRC's Quantitative Health Objectives."

PSDAR at page 29. But this ignores the wide range of hostile-action-based scenarios that were made vividly possible after the attacks of September 11, 2001.These hostile actions, according to the National Academies of Science, could lead toa zirconium fire in the spent fuel pool or severely damage the torus where morethan one million gallons of radioactive water will be stored until decontamination and dismantling.

See National Academies of Science, Committee on the Safety andSecurity of Commercial Spent Nuclear Fuel Storage Board on Radioactive WasteManagement Division on Earth and Life Studies National Research

Council, SafetyAnd Security Of Commercial Spent Nuclear Fuel Storage [Public Report] (2006).The U.S. Court of Appeals for the Ninth Circuit has already ruled that "thepossibility of terrorist attack" is not so "remote and highly speculative" as to falloutside the bounds of NEPA. San Luis Obispo Mothers for Peace, 449 F.3d at 1030.58 The NRC thus must assess the potential environmental impacts from, for instance, a terrorist attack that leads to a zirconium fire in the spent fuel pool or severelydamages the torus where more than one million gallons of radioactive water will bestored until decontamination and dismantling.

See id.V. The NRC Should Require Entergy to Address Numerous OtherDeficiencies in the PSDAR and Related FilingsIn addition to addressing the overarching concerns raised above, the Staterequests that the NRC require Entergy to address a number or other deficiencies inits PSDAR and related filings.

The State flagged many of these errors andoversights in its December 13, 2014 submission to Entergy-a submission that, asnoted earlier, is expressly incorporated into these Comments.

See Exhibit 1.In addition:

-A number of aspects of the Site Assessment Study bear directly on thePSDAR, and the NRC should require Entergy to explain aspects of the SiteAssessment Study that are unsupported or inconsistent with representations thatEntergy makes in the PSDAR. For instance, in § 8.3, page 53, of the SiteAssessment Study, Entergy provides a table of "Cost Estimate Results" withnumbers that are unexplained and unsupported.

The State pointed this out toEntergy in the State's comments in December 2014, but received no response onthis issue. The text preceding this section indicates that the vendor estimates wereonly for license termination work. The implication is that the vendor estimates oflicense termination were combined with Entergy's estimates for spent fuelmanagement and site restoration to arrive at a total estimate.

Thus, one would59 expect the difference between each vendor license termination estimate and thetotal to be roughly the same. One would also expect the difference to be equal toEntergy's cost estimate of a total of about $425 million in spent fuel management and site restoration costs (the difference between $817 million in licensetermination costs and the total $1.24 billion estimate).

Yet neither is the case.Rather than $425 million, each of the three vendor estimates add in around $694 toabout $754 million for spent fuel management and site restoration.

The NRCshould ask Entergy to explain what spent fuel management and site restoration costs were used to arrive at the total decommissioning cost for each vendor, andwhy these costs differ for each vendor even though the vendors apparently were notasked to estimate those costs.-Table 2.1 (page 8): The Large Component Removal duration is given as 1.3years, including reactor vessel internals and reactor vessel segmentation.

This isunrealistic given that the Zion decommissioning currently underway began theseactivities in 2010 and is not yet complete and may take another year or so. TheNRC should ask Entergy to explain how the cost for the segmentation workincluded in the Vermont Yankee estimate would change if the period of performance were four years or more consistent with Zion experience.

The NRC should also askEntergy to explain how any change in the period of performance for this work wouldaffect the overall duration or cost of the license termination work.-Section 2.2.3: Entergy claims that radioactive decay during the SAFSTORperiod will significantly reduce the quantity of contamination and radioactivity that60 must be disposed of during decommissioning.

But, as the State pointed out toEntergy in its December 2014 comments, the Site Assessment Study shows thatthere appears to be no reduction in waste volume based on decay during SAFSTOR.Similarly, Entergy says as much in its own Decommissioning Cost Estimate:

"Noprocess system containing/handling radioactive substances at shutdown ispresumed to meet material release criteria by decay alone (i.e., systems radioactive at shutdown

[will] still be radioactive over the time period during which thedecommissioning is accomplished, due to the presence of long-lived radionuclides.)".

Decommissioning Cost Estimate

§ 5, page 2. While decay would reduce the numberof curies to be removed and in that sense the quantity of radioactivity

removed, thediscussion should be clarified to note that waste volumes are not decreased.

-Section 2.2.4: Assuming that the current cost estimate is based on disposalof waste at the Waste Control Specialists Site (WCS) facility, a comparison of wastedisposal costs in the 2012 Vermont Yankee estimate and the current estimatereveals inconsistencies that the NRC should ask Entergy to explain.

In the 2012estimate, it was assumed that a large fraction of the low-level waste would be sentto an off-site processing facility with the remainder being sent to Envirocare forburial. The total cost of waste processing and burial for a total of about 669,000cubic feet of waste was a little over $60 million dollars.

However, in the currentestimate it appears no waste would be sent to a processor and all waste would besent for burial at WCS, with higher disposal cost than Envirocare, but the totalwaste burial cost is only about $45 million for a total volume of about 666,000 cubic61 feet. It is unclear how shifting from the lower cost off-site processing andEnvirocare assumption to the WCS assumption results in substantially lower cost.Further, the average cost per cubic foot for disposing of waste through a processor in the 2012 estimate is about $66 per cubic foot. Calculating the average cost ofwaste disposal at WCS in the current estimate, the cost is about $67 per cubic foot.It is unclear how the per-cubic-foot cost for disposal at WCS could be comparable tothe 2012 cost for off-site processing which was cheaper than even disposal atEnvirocare.

In 2012, the rate for disposal at WCS was about $150 per cubic foot.Using that rate, the total waste burial cost would be about $99 million rather thanthe $45 million that Entergy estimates in its Decommissioning Cost Estimate.

TheNRC should ask Entergy to explain the rates assumed for disposal of low-level waste and the basis for this rate.-Section 2.2.5 (Removal of Mixed Waste): This section currently states that"[i]f technology, resources, and approved processes are available, the processes willbe evaluated to render the mixed waste non-hazardous."

Rendering mixed wastenon-hazardous may only occur pursuant to 40 C.F.R. 266.235 as adopted byVermont in VHWMR 7-109(b)(2),

when applicable, or pursuant to a hazardous waste treatment facility permit (see Subchapter 5 of the Vermont Hazardous WasteManagement Regulations).

This section of the PSDAR should be revisedaccordingly to reflect this requirement.

-Section 2.2.6 (Site Characterization):

This section currently states that"[d]uring the decommissioning

process, site characterization will be performed in62 which radiological, regulated, and hazardous wastes will be identified, categorized, and quantified."

The State of Vermont regulates and manages non-radiological Hazardous Waste Sites utilizing the Agency of Natural Resources' Investigation andRemediation of Contaminated Properties Procedure (IROCPP),

which outlinesprocesses for the investigation and remediation of releases of non-radiological hazardous materials.

Entergy must prepare and submit a detailed plan outlining its characterization process for the site that is consistent with the IROCPP, as wellas a proposed schedule for site assessment and remediation of the site. The PSDARshould be revised to reflect this information.

-Section 2.2.7: This discussion is inappropriately limited to remediation oftritium and fails to account for the recent discovery of strontium-90 in groundwater.

Further, even if Entergy could limit this section to tritium contamination, Entergycannot assume that remediation or removal of structural materials or soilcontaining tritium will not be required solely because the levels are less than thoserequired by the NRC for license termination.

When decommissioning occurred atthe Yankee Rowe plant, the licensee processed or removed all material withdetectable tritium.

The NRC should ask Entergy to explain why it believes thatsimilar remedial measures at Vermont Yankee will not be required.

.Section 4.1, page 21: The PSDAR should explain the rationale for using theHIS Global Insight's Index for CPI, All Urban, All Items, for the escalation of low-level waste costs at WCS. Historically, low-level waste costs have grown at muchhigher rates than general cost escalation.

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• Section 5.4 (Additional Considerations):

Entergy's PSDAR reaffirms itscommitment to "conduct all activities in Vermont, including at the VY Station site,in accordance with federal and state laws, including VDH's Radiological HealthRule" in accordance with the December 2013 Settlement Agreement.

Todemonstrate that Entergy's decommissioning and site restoration activities willcomply with all state laws, including Agency of Natural Resources regulations, Entergy must submit a more detailed plan and timeline of decommissioning andother activities required to remediate the site. This must include a detaileddescription and schedule for such non-radiologically related processes as:demolishing buildings on site, removal of underground petroleum storage tanks, thephased closure of waste handling and storage areas on the site, and sitecharacterization and investigation procedures and techniques.

As noted earlier,requests for this information as well as other information pertaining to Entergy's plan for decommissioning and remediation of the site were submitted to Entergy bythe Agency of Natural Resources in its December 2014 comments.

To date, Entergyhas not supplied this information to the Agency. The PSDAR should be revised todemonstrate how Entergy's post-closure activities will comply with state laws andregulations.

CONCLUSION The State of Vermont has a number of concerns with the decommissioning plans that Entergy has submitted to the NRC in Entergy's PSDAR and relatedfilings.

For the reasons noted above, the PSDAR is deficient and does not comply64 with applicable NRC regulations.

Entergy has a lot more work to do before theNRC and State officials can conclude that Entergy's plans for decommissioning Vermont Yankee will comply with all applicable state and federal law.Entergy's decommissioning plans are also deficient because they delay thesite characterization that is needed to determine the true costs of decommissioning, while simultaneously claiming that there is already an "excess" amount of money inthe NDT Fund. On that front, the State's request is a modest one-simply that theNRC apply the regulations that already apply to the NDT Fund and not allowEntergy to be exempted from those regulations.

This request coincides with whatEntergy is already obligated to do under the Master Trust Agreement it signedwhen it bought the Vermont Yankee plant.The State of Vermont is a sovereign entity hosting the plant at issue in thisproceeding.

The State and its citizens are the ones who will ultimately live with theconsequences of the decisions that are made in the next few months. The NRCmust take the State's concerns seriously.

For the reasons noted above, the NRC should act now to address all of thematters raised in these Comments.

For the NRC's convenience, the State hassummarized its specific requested actions in the Addendum immediately following these Comments.

The State looks forward to the NRC's response to these Comments and to acontinued dialogue with the NRC and Entergy as these matters proceed forward.65 ADDENDUMThe State respectfully requests that the NRC should take the following actions now:.Require Entergy to provide a detailed response to all of the State'sDecember 13, 2014 comments.

" Require Entergy to respond to the State's Comments provided today." Provide the NRC's response to each of the State's Comments.

" Provide the State with a full adjudicatory hearing in accordance with 10C.F.R. § 2.104 to address the State's concerns and protect the public interest.

" Require Entergy to revise its cost estimates as noted above." Require Entergy to use the time between now and December 2016 toengage in a more thorough radiological and non-radiological site characterization sothat it can make a more accurate Decommissioning Cost Estimate in connection with its PSDAR.* Require Entergy to plan for contingencies that may not be discovered untilthe end of SAFSTOR and that would increase the total cost for decommissioning, spent fuel management, or site restoration.

.Not allow Entergy to rely on cost estimates that assume that all spent fuelwill be removed from the site by 2052..Not grant Entergy's January 6, 2015 exemption

request, and find deficient Entergy's December 19, 2014 Updated Irradiated Fuel Management, UpdatedDecommissioning Funding Status Report, and related portions of the PSDAR andDecommissioning Cost Estimate insofar as Entergy is attempting to use the66 Vermont Yankee NDT Fund for spent fuel management expenses during the post-closure period before radiological decommissioning is complete.

The NRC shouldthen require Entergy to submit revised filings of its December 19, 2014 filings,including a revised plan for spent fuel management expenses that is consistent withthe requirements of 10 C.F.R. § 50.54bb..Analyze Appendix C of Entergy's Decommissioning Cost Estimate andprohibit Entergy from withdrawing money from the Vermont Yankee NDT Fund forall items that fail to meet the NRC's definition of decommissioning, including, at aminimum, the following:

a. The $5 million payment (lines la.2.22 & lb.2.22) that Entergy ismaking to the State as part of the Settlement Agreement;

b. Emergency planning costs (e.g., line la.2.23);

c. Shipments of non-radiological asbestos waste (e.g., line la.2.27);

d. Insurance (e.g., line la.4.1);e. Property taxes (e.g., line la.4.2);f. Replacement of structures during SAFSTOR (e.g., line 2b. 1.4);g. Any costs associated with offsite buildings that are notradiologically contaminated; andh. All other listed costs that relate to activities that do not reduceradiological contamination.

Require Entergy to explain, in light of its merchant-generator status, howit will fund items such as those listed above, as well as costs that are not currently 67 listed in its Decommissioning Cost Estimate, such as employee pension fundliabilities.

• Require Entergy to revise Appendix C of its Decommissioning CostEstimate to include a fourth category that contains expenses such as the ones listedabove and Entergy's "NEI Annual Fee" (e.g., line la.2.38 of Appendix C).* Require Entergy to revise incorrect estimates, such as Entergy's claim thatit will pay only around $7,000 per year in property taxes beginning in 2020 (e.g.,lines 2aa.4.2 & 2b.4.2)..Take all other actions necessary to protect the money in the NDT Fundand allow its expenditure only for allowable uses until radiological decommissioning is complete.

.Undertake a NEPA-compliant comprehensive analysis of all potential environmental and economic impacts of Entergy's post-closure plans, including ananalysis of all potential impacts related to:a. All potential radiological incidents at the site;b. The continued storage of spent nuclear fuel, including thepossibility of indefinite storage onsite and the possibility of aterrorist attack on stored spent nuclear fuel;c. The transfer of spent nuclear fuel and the possibility of accidents during such transfers from the spent fuel pool to dry casks andpotentially from old dry casks to new dry casks;68

d. The creation and operation of a Dry Fuel Transfer Station to movespent fuel into new dry casks every 100 years, and the fundingsource for: (1) the construction of a Dry Fuel Transfer Station;(2) the purchase of 58 new casks and all other labor and materialcosts for transferring the fuel every 100 years; and (3) the costs ofmaintaining security at the site indefinitely

e. The existence of radiological and non-radiological contamination;

f. The generation and storage of non-radiological contaminants; andg. Site-specific impacts resulting from:i. the plant's close proximity to an operating elementary school(and potential airborne asbestos and lead contamination, aswell as potential impacts from a radiological incident);

ii. recreational activities on the bordering Connecticut River;iii. species that may become listed as endangered or threatened in the next 60 years;iv. science's increased understanding of climate change,including expected increases in the severity of floods;v. known and unknown contamination at Vermont Yankeefrom previously identified tritium leaks and the morerecently identified presence of strontium-90; 69 vi. unique environmental and economic impacts andalternatives related to the length of any SAFSTOR period,including negative impacts from a longer SAFSTOR period;vii. the inability to go back to ratepayers if any post-closure costs have been underestimated; andviii. the storage of an estimated 1.3 million gallons of highlyradioactive water in the torus during SAFSTOR.* Require Entergy to explain how each of the above impacts is allegedly bounded by previously issued environmental impact statements and why Entergybelieves that a supplemental environmental impact statement is not needed to meetthe requirements of 10 C.F.R. § 50.92..Require Entergy to explain how it plans to comply with state law for theclosure of non-radiological waste handling and storage areas on site, including whether it has submitted a plan to the Agency of Natural Resources as the Agencyrequested.

.Require Entergy to extensively monitor groundwater untildecommissioning is complete and its license has been terminated, including at aminimum:

maintaining its current monitoring levels as required by NEI 07-07;undertaking monthly sampling from all 32 groundwater monitoring wells and allthree drinking water wells currently sampled at Vermont Yankee; and providing split samples from those wells to the Vermont Department of Health forindependent confirmatory analysis.

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.Require Entergy to continue to perform radiological environmental monitoring of the pathways to the public, direct gamma radiation, soils, sediments, fish and other flora and fauna as conducted during operation of the facility.

.Require Entergy to provide the State with split samples from the finalstatus surveys that are intended to document that soil and structure remediation will allow release of the site for unrestricted use at NRC license termination.

.Require Entergy to revise its analyses to reflect the current requirements under its license for maintaining an Emergency Planning Zone.* Require Entergy to explain what fire protection systems will be in place atVermont Yankee.* Perform a NEPA-compliant analysis of any proposed reductions in theEmergency Planning Zone, including analyzing issues such as radiological spillcontrol during dewatering operations and the potential environmental impacts froma terrorist attack that leads to a zirconium fire in the spent fuel pool or severelydamages the torus where more than one million gallons of radioactive water will bestored until decontamination and dismantling.

• Require Entergy to explain aspects of the Site Assessment Study that areunsupported or inconsistent with representations that Entergy makes in thePSDAR, including unexplained and unsupported numbers in the table of "CostEstimate Results" in § 8.3, page 53, of the Site Assessment Study.71

.Require Entergy to explain why Large Component Removal will take only1.3 years at Vermont Yankee when it is taking more than 4 years at Zion, and howa longer period would affect Entergy's cost and duration estimates.

• Require Entergy to clarify that waste volumes will not be decreased as aresult of SAFSTOR..Require Entergy to explain discrepancies between its current cost estimatefor waste disposal at the WCS facility and the estimate it made in 2012..Require Entergy to explain how it plans to comply with state law requiring that rendering mixed waste non-hazardous may only occur pursuant to 40 C.F.R.266.235 as adopted by Vermont in VHWMR 7-109(b)(2),

when applicable, orpursuant to a hazardous waste treatment facility permit (see Subchapter 5 of theVermont Hazardous Waste Management Regulations).

.Require Entergy to prepare and submit a detailed plan outlining itscharacterization process for the site that is consistent with the Investigation andRemediation of Contaminated Properties Procedure, as well as a proposed schedulefor site assessment and remediation of the site..Require Entergy to revise the PSDAR in light of the recent discovery ofstrontium-90 in groundwater.

.Require Entergy to explain why it assumes that remediation or removal ofstructural materials or soil containing tritium will not be required if the levels areless than those required by the NRC for license termination, when the licensee atplants like Yankee Rowe processed or removed all material with detectable tritium.72

.Require Entergy to explain the rationale for using the HIS Global Insight's Index for CPI, All Urban, All Items, for the escalation of low-level waste costs atWCS, given that historically low-level waste costs have grown at much higher rates..Require Entergy to submit a more detailed plan and timeline ofdecommissioning and other activities required to remediate the site.73 Exhibit 2VT Ex. 2 001 ENTERGY NUCLEAR VERMONT YANKEE, LLCMASTER DECOMMISSIONING TRUST AGREEMENT FORVERMONT YANKEE NUCLEAR POWER STATIONDated July 31, 2002LIBC/1548679.7 TABLE OF CONTENTSARTICLE I. DEFINITIONS

............................................................................................

21.0 1 D efinitions

..........................................................................................................

2ARTICLE II. MASTER TRUST PURPOSE, NAME AND FUNDS ...............................

52.01 Master Trust Purpose ...................................................................................

52.02 Establishment of Master Trust .....................................................................

52.03 Acceptance of Appointment

........................................................................

52.04 Name of Master Trust ..................................................................................

62.05 Division of Master Trust ................................................................................

62.06 Designation of Funds ....................................................................................

62.07 Duties of Authorized Representatives

..........................................................

62.08 No Authority to Conduct Business

...............................................................

62.09 No Transferability of Master Trust ...............................................................

72.10 Use of Qualified Fund ......................................

7ARTICLE III. CONTRIBUTIONS AND INCOME ...................................................

73.01 Contributions

.................................................................................

73.02 Allocation of Net Income ............................................................................

73.03 Subsequent Transfers

.....................................................................................

7ARTICLE IV. DISTRIBUTIONS

...........................................

...... a4.01 Payment of Decommissioning Costs and Administrative Expenses

.............

84.02 Administrative Expenses

.............................................................................

84.03 Fees ............................................................................................................

84.04 Liquidation of Investments

...........................................................................

84.05 Notice to the NRC .........................................................................................

84.06 Approval by State of Vermont Public Service Board ....................................

9ARTICLE V. TERMINATION

....................................

95.01 Termination of Funds and Master Trust in General .......................................

95.02 Distribution of Master Trust and Funds Upon Termination

..............

... 9ARTICLE VI. TRUSTEES

.................................................

..................................

106.01 Designation and Qualification of Successor Trustee(s)

..............................

106.02 Exoneration from Bond ....................................

-116.03 Resignation

.............................................

116.04 Transactions with Third Parties ...............................

116.05 A ccounts and Reports ......................................................................................

116.06 Tax Returns and Other Reports ...............................

126.07 Liability

.......................................................................................................

12LIBC/I1548679.7 ARTICLE VII. TRUSTEE'S GENERAL POWERS .......................

147.01 Registration of Securities

................................................................................

147.02 B orrow ing ..................................................................................................

147.03 Retention and Removal of Professional and Employee Services

...............

147.04 Delegation of Ministerial Powers ...............................................................

147.05 Powers of Trustee to Continue Until Final Distribution

............................

147.06 Discretion in Exercise of Powers ...............................................................

147.07 D eposit of Funds .........................................................................................

157.08 Loaning of Securities

.................................................................................

157.09 Retention of Uninvested Cash ...................................................................

15ARTICLE VIII. INVESTMENTS

....... ..........................

158.01 General Investment Powers ........................................................................

158.02 Direction by Investment Manager(s)

..........................................................

158.03 Trustee's General Investment Powers ........................................................

16ARTICLE IX. MISCELLANEOUS

................................

.189.01 H eadings ....................................................................................................

189.02 Interpretation

................................................................................................

189.03 Severability of Provisions

...........................................................................

189.04 Delivery of Notices Under Agreement

.......................................................

189.05 Alterations and Amendments

.......................................................................

199.06 Successors and Assigns ..............................................................................

209.07 Governing Law; Jurisdiction; Certain Waivers ..........................................

209.08 Accounting Year ..........................................................................................

209.09 Counterparts

............................................

209.10 Decommissioning Liability

.........................................................................

209.11 Limitation on Liability of Trustee ..............................................................

219.12 Representation

...........................................................................................

21EXHIBIT A PERMITTED INVESTMENTS EXHIBIT B FORM OF DECOMMISSIONING CERTIFICATE EXHIBIT C CROSS TRADING INFORMATION EXHIBIT D DECOMMISSIONING REQUIREMENTS EXHIBIT E SPONSORS AND OWNERSHIP INTERESTEXHIBIT F FORM OF NOTIFICATION OF ASSIGNMENT iiLIBC/1548679.7 MASTER DECOMMISSIONING TRUST AGREEMENT MASTER DECOMMISSIONING TRUST AGREEMENT made as of this 31st day ofJuly 2002, by and between ENTERGY NUCLEAR VERMONT YANKEE, LLC, a Delawarelimited liability company (the "Company"),

and MELLON BANK, N.A., as Trustee (the"Trustee"),

a national banking association having trust powers.WHEREAS, the Station is a nuclear fueled electric generating station which will requireDecommissioning at the end of its useful life;WHEREAS, pursuant to the requirements of the NRC, the owner of the Station isrequired to create and maintain a source of funding to provide for the costs associated with theDecommissioning of the Station;WHEREAS, the Company is party to a Purchase and Sale Agreement (the "Purchase andSale Agreement"),

dated as of August 15, 2001, as amended from time to time, by and amongVermont Yankee Nuclear Power Corporation, a Vermont corporation

("VYNPC"),

theCompany, and Entergy Corporation, a Delaware corporation, pursuant to which VYNPC istransferring to the Company all or substantially all of the assets and certain of the liabilities constituting the Station;.

WHEREAS, among those assets ahd liabilities being transferred to the Companypursuant to the Purchase and Sale Agreement, are (i) all of those assets comprising the trustfunds maintained by VYNPC with respect to Decommissioning of the Station pursuant to theIndenture of Trust, dated as of March 11, 1988, as amended, between VYNPC and The Bank ofNew York, as successor trustee (the "VYNPC Trust Funds"),

and (ii) all of the liabilities ofVYNPC in respect of: (a) the Decommissioning of the Station and the Site following permanent cessation of operations, (b) the management,

storage, transportation and disposal of spent nuclearfuel generated at the Station (other than as specified in the Purchase and Sale Agreement),

and(c) any other post-operative disposition of the Station or any other of the assets being purchased by the Company;WHEREAS, pursuant to Section 468A of the Internal Revenue Code of 1986, asamended, (the "Code") certain federal income tax benefits are available to the Company as aresult of creating and making contributions to certain nuclear decommissioning reserve funds;WHEREAS, the Company, in order to comply with the requirements of the NRC, and inorder to be in a position to take advantage of the federal income tax benefits available under the,aforementioned Section 468A, wishes to establish the Qualified Fund and the Nonqualified Fundto hold amounts in trust for the future Decommissioning of the Station;WHEREAS, the Company wishes to establish a master trust (the "Master Trust") for theretention and investment of the assets of the Qualified Fund and Nonqualified Fund for theStation, wherein each of the Funds shall constitute a separate trust under the Master Trust; andLIBC/1548679.7

WHEREAS, Mellon Bank, N.A. is willing to serve as Trustee under the Master Trust onthe terms and conditions herein set forth.NOW, THEREFORE, in consideration of the mutual promises herein contained and othergood and valuable consideration, receipt and sufficiency of which is hereby acknowledged, theTrustee hereby agrees to accept, from and after the date first above written, Contributions to theMaster Trust delivered to it from time to time by or on behalf of the Company;TO HAVE AND TO HOLD such assets;TO INVEST AND REINVEST the same as provided herein;IN TRUST NEVERTHELESS, for the uses and purposes and upon the terms andconditions, as hereinafter set forth; andTO PAY OR DISTRIBUTE from the Master Trust as provided herein.ARTICLE I.DEFINITIONS 1.01 Definitions.

As used in this Master Decommissioning Trust Agreement, thefollowing terms shall have the following meanings:

(a) "Administrative Expenses" has the meaning given in Section 4.02.(b) "Agreement" means this Master Decommissioning Trust Agreement as thesame may be amended,

modified, or supplemented from time to time.(c) "Applicable Law" means all applicable laws, statutes,

treaties, rules,codes, ordinances, Regulations, certificates, orders, interpretations, licenses and permits of anyGovernmental Authority and judgments,

decrees, injunctions, writs, orders or like action of anycourt, arbitrator or otherjudicial or quasi-judicial tribunal of competent jurisdiction (including those pertaining to health, safety, the environment or otherwise).

(d) "Applicable Tax Law" means Section 468A of the Code (or anycomparable subsequent provision of the Code) and the Regulations thereunder, and any otherprovision of the Code relating to the federal taxation of the Funds or credits or deductions basedon Contributions.

(e) "Authorized Representatives" has the meaning given in Section 2.07.(f) "Business Day" means any day other than Saturday, Sunday and any daywhich is a legal holiday or a day on which banking institutions in the Commonwealth ofPennsylvania are authorized or required by Applicable Law or other action of Governmental Authority to close.(g) "Code" has the meaning given in the recitals of this Agreement.

2LIBC/1548679.7 (h) "Company" has the meaning given in the preamble of this Agreement.

(i) "Contribution" means any contribution, cash or otherwise, made to theTrustee for deposit in one or more of the Funds and in such subaccounts thereunder as providedin this Agreement.

No contribution that consists of real property shall be permitted.

(j) "Decommissioning" means the removal of the Station from service anddisposal of its components in accordance with Applicable Law. This process shall include, butnot be limited to, (i) pre-shutdown activities related to the removal and disposal of the Stationincluding

studies, planning, licensing, regulatory filings and non-DOE spent fuel storage,(ii) work done to prepare and carry out DECON, ENTOMB or SAFSTOR (as defined by theNRC) of the Station and the Site, whichever is applicable, (iii) the removal of radioactively contaminated and radioactively uncontaminated portions of the Station and disposing of the sameat the end of the operating life of the Station, (iv) work done to the Site and the Station's associated equipment and facilities and to other areas, whether or not such areas are contiguous to the Site and iequipment and facilities, in order to decontaminate such Site and such areas, and(v) work done 6y or on behalf of the Company (or for which the Company is charged) to afacility where any portion of the Station and its associated equipment and facilities are to bedisposed of in order to prepare and maintain such facility as a disposal site.(k) "Decommissioning Certificate" means a document properly completed and executed by an Authorized Representative and substantially in the form of Exhibit B as itmay from time to time be amended.

I(1) "Decommissioning Costs" shall mean all costs and expenses relating orallocable to, or incurred in connection with, Decommissioning, including, but not limited to, thedecontamination and/or removal of the equipment, structures and portions of the Station and theSite provided,

however, that if Applicable Law prohibits the foregoing or imposes requirements that are more costly to implement than their removal, the term "Decommissioning Costs" shallmean all costs and expenses relating or allocable to, or incurred in connection with, therequirements imposed by Applicable Law at the end of the Station's operating life.(m) "Docket 6545 Decommissioning Activities" has the meaning given inExhibit D.(n) "Excess Funds" shall have the meaning given in Exhibit D.(o) "Exemption" has the meaning given in Section 8.03(b).(p) "FERC" means the Federal Energy Regulatory Commission or anysuccessor thereto.(q) "Funds" means the Qualified Fund and the Nonqualified Fund,collectively.

(r) "Governmental Authority" means any federal, state, county, municipal,

foreign, international, regional or other governmental authority, agency, board, body,instrumentality or court, including, without limitation, the NRC and the FERC.3LIBC/1548679.7 (s) "Investment Account" has the meaning given in Section 8.01.(t) "Investment-Grade Securities" means "investment-grade" securities, including, without limitation, investment-grade bonds and preferred stocks, which are those ratedat least "BBB" or equivalent by a national rating service, but shall not included (i) speculative issues of common stocks, including without limitation "bu.lletin board" stocks listed on theNASDAQ exchange, "pink sheet" stocks, and stocks not traded on major exchanges, and (ii)high yield or "junk" bonds.(u) "Investment Manager" has the meaning given in Section 8.01.(v) "Master Trust" has the meaning given in the recitals of this Agreement.

(w) "Nonqualified Fund" means a trust fund that does not constitute theQualified Fund established under, and in accordance with, Section 2.02(b) or such otherNonqualified Ftinds as the Company shall establish from time to time in accordance with Section2.05. A Nonqualified Fund shall have such subaccounts as the Company may specify.(x) "NRC" means the Nuclear Regulatory Commission, the agencyestablished in Title H of the Energy Reorganization Act of 1974, as amended, comprising themembers of the Commission and all offices, employees and representatives authorized to act inany case or matter, or any successor agency.(y) "NRR Director" has the meaning given in Section 4.05.(z) "Nuclear Safety Director" has the meaning given in Section 4.05.(aa) "Order" shall mean any order relating to Decommissioning issued by aGovernmental Authority and applicable to the Station.(bb) "Purchase and Sale Agreement" has the meaning given the recitals of thisAgreement.

(cc) "Qualified Fund" means the trust fund established under, and inaccordance with, Section 2.02(b) for purposes of Section 468A of the Code, which is designated as such in the records of the Trustee.

The Qualified Fund shall have such subaccounts as theCompany may specify.

Contributions, if any, made to the Qualified Fund in any year shall notexceed the amount permitted to be made to such Fund with respect to the year in question inorder for the Company to be allowed to take the deduction afforded by Section 468A of theCode.(dd) "Regulation" means any requirement having the force of law which isbinding on the Company.(ee) "Service" means the Internal Revenue Service or any successor thereto.(f) "Sit._e" means the land upon which the Station is situated, located inVernon, Vermont.4LIBC/I 548679.7 (gg) "Site Restoration Costs" shall have the meaning given in Exhibit D.(hh) "Spent Fuel Costs" has the meaning given in Exhibit D.(ii) "Sponsors" shall have the meaning given in Exhibit E.(jj) "Station" means the nuclear fueled electric generating station designated as and known as Vermont Yankee Nuclear Power Station (NRC Operating License No. DPR-28)at the Site together with those facilities, equipment,

supplies, and improvements included in theAcquired Assets (as such term is defined in the Purchase and Sale Agreement).

(kk) 'Trustee" has the meaning given in the preamble of this Agreement or anysuccessor appointed pursuant to Section 6.01.(11) "VYNPC" has the meaning given in the recitals of this Agreement.

ARTICLE II.MASTER TRUST PURPOSE, NAME AND FUNDS2.01 Master Trust Purpose.

The exclusive purpose of this Master Trust is toaccumulate and hold funds for the contemplated Decommissioning of the Station and to use suchfunds, in the first instance, for expenses related to the Decommissioning of the Station as definedby the NRC in its Regulations and issuances, and as provided in the licenses issued by the NRCfor the Station and any amendments thereto.2.02 Establishment of Master Trust. By execution of this Agreement, the Company:(a) establishes the Master Trust for the -retention and investment of the assetsof the Funds, which shall be effective on the date first above written;(b) establishes the Qualified Fund and the Nonqualified Fund for the Station;and(c) appoints Mellon Bank, N.A. as Trustee of the Master Trust.2.03 Acceptance of Appointment.

Upon the terms and conditions herein set forth theTrustee accepts the appointment as Trustee of this Master Trust. The Trustee declares that it willhold all estate, right, title and interest it may acquire hereunder exclusively for the purposes setforth in this Article II. The Trustee shall receive any Contributions deposited with it by theCompany in trust for the benefit of the Company and shall deposit such Contributions in one ormore of the Funds, and in such subaccounts thereunder, as provided in Section 2.05 andotherwise as the Company shall specify.

The Trustee shall hold, manage, invest and administer such Contributions, together with earnings and appreciation

thereon, in accordance with thisAgreement.

In performing its duties under this Agreement, the Trustee shall exercise the samecare and diligence that it would devote to its own property in like circumstances.

The Trustee,Investment Manager or anyone else directing the investments made in this Master Trust shall5LIBC/1548679.7 adhere to a "Prudent Investor" standard as specified in 18 CFR 35.32(a)(3) of the Federal EnergyRegulatory Commission's regulations or any comparable Regulatibn.

2.04 Name of Master Trust. The Contributions received by the Trustee from theCompany together with the proceeds, reinvestments and appreciation thereof shall constitute the"Entergy Nuclear Vermont Yankee Master Decommissioning Trust."2.05 Division of Master Trust.(a) The Master Trust shall be divided by the Trustee into the Qualified Fundand the Nonqualified Fund for the Station and into such other Nonqualified Funds as theCompany from time to time shall establish.

Each Fund shall constitute a separate trust under theMaster Trust and shall be designated as relating to the Station.

Each Fund may have subaccounts as the Company from time to time shall specify.(b) The Trustee shall maintain such records as are necessary to reflect eachFund and each subaccount thereunder separately on its books from each other Fund andsubaccount.

2.06 Designation of Funds. Upon (i) any Contribution to the Master Trust; or (ii) anywithdrawal from the Master Trust; or (iii) any transfer between the Funds or subaccounts thereunder, the Company shall designate

ýin writing) in accordance with Articles III or IV of thisAgreement, as applicable, the Fund(s),

and the subaccount(s) thereunder, which is to be creditedor debited for the amount of such Contribution, withdrawal or transfer, and the Trustee shallcredit or debit the Fund(s),

and the subaccount(s) thereunder, in accordance with suchdesignation.

2.07 Duties of Authorized Representatives.

The Company shall provide the Trusteewith a written statement setting forth the names and specimen signatures of those persons itdesignates as "Authorized Representatives".

The Company hereby empowers the Authorized Representatives and their delegates to act for the Company in all respects hereunder.

TheAuthorized Representatives may act as a group or may designate one or more Authorized Representative(s) or delegate(s) to perform the duties described in the foregoing sentence.

TheAuthorized Representatives shall provide the Trustee with a written statement setting forth thename and specimen signature of any delegate of the Authorized Representatives.

Until otherwise notified in writing by the Company, the Trustee may rely upon any written notice, instruction,

' direction, certificate or other communication believed by it to be genuine and to be signed orcertified by any one or more Authorized Representatives or their designated delegate(s) and theTrnstee shall be under no duty to make any investigation or inquiry as to the truth or accuracy ofany statement contained therein.2.08 No Authority to Conduct Business.

The purpose of this Master Trust is limitedspecifically to the matters set forth in Section 2.01, and there is no objective to carry on anybusiness unrelated to the Master Trust purpose set forth in Section 2.01, or to divide the gainstherefrom.

6L1BC/1548679.7 2.09 No Transferability of Master Trust. The interest of the Company in the MasterTrust is neither transferable, whether voluntarily or involuntarily, By the Company nor subject tothe payment of the claims of creditors of the Company;

provided, however, that any creditor ofthe Company as to which a Decommissioning Certificate has been properly completed andsubmitted to the Trustee may assert a claim directly against the Master Trust in an amount not toexceed the amount specified in such Decommissioning Certificate; and provided,

further, that allor a portion of the interest of the Company in the Master Trust may be transferred to a purchaser of all or substantially all of the assets of the Station that also assumes responsibility forDecommissioning the Station.2.10 Use of Qualified Fund. The assets of the Qualified Fund shall be used only asauthorized by Code Section 468A and the Regulations thereunder as amended from time to time.ARTICLE III.CONTRIBUTIONS AND INCOME3.01 Contributions.

The Company may make such Contributions to any Fund fromtime to time as it shall deem necessary or appropriate.

The Trustee shall return Contributions tothe Company to the extent such Contributions are made by the Company and such Contribution is stated in a written opinion of legal counsel to the Company, who may be an employee of theCompany, to be excessive in light of Applicable Law and Applicable Tax Law.3.02 Allocation of Net Income. The Trustee may pool the assets among the Funds forinvestment purposes in accordance with the written instructions of the Company, subject to thelimitations on investments contained in Exhibit A, and, upon so doing, shall treat each Fund sopooled as having received or accrued a pro rata portion (based on the principal balances of theFund so pooled) of the net income of the Master Trust (including appreciation) related to suchpooled assets in any accounting period of the Master Trust. Without limiting the requirements ofSection 6.05, the Trustee shall maintain such separate records of each of the Funds and thesubaccounts thereunder as are necessary to reflect the assets thereof and the allocation of incomeand losses among the Funds and subaccounts thereunder.

The Trustee may rely upon the writtenopinion of legal counsel of the Company, who may be an employee of the Company, withrespect to any question arising under this Section 3.02.3.03 Subsequent Transfers.

Upon receipt of a written directive of the Company signedby one or more Authorized Representatives or their designated delegate(s) which sets forth anamount to be transferred from one of the Funds or subaccounts thereunder and states that such-amount should be transferred to one or more other Funds or subaccounts as specified, the Trusteeshall transfer such amount to the Fund(s) or subaccounts specified by the Company in the writtendirective.

7LIBC/I548679.7 ARTICLE IV.DISTRIBUTIONS 4.01 Payment of Decommissioning Costs and Administrative Expenses.

In addition topayments otherwise authorized by this Agreement, the Trustee shall make payments out of theFunds or any subaccounts thereunder upon being presented with a Decommissioning Certificate by the Company that instruct the Trustee to disburse amounts in the Funds or any subaccounts thereunder in a manner designated in such Decommissioning Certificate for purposes of payingcosts, liabilities and expenses of Decommissioning or, if so specified, administrative expensesrelated to services authorized by the Company pursuant to Section 4.02. Once Decommissioning is completed, the Trustee shall also disburse amounts in the Funds in a manner designated in anyDecommissioning Certificate for the purposes of paying costs, liabilities and expenses of Docket6545 Decommssioning Activities, Spent Fuel Costs and Site Restoration Costs (each to theextent not inchlded in Decommissioning).

If the assets of any Fund or subaccount thereof areinsufficient to permit the payment in full of amounts to be paid pursuant to a Decommissioning Certificate, the Trustee shall have no liability with respect to such insufficiency and noobligation to use its own funds to pay the same.4.02 Administrative Expenses.

In addition to the payment of administrative expensespaid pursuant to Section 4.01, from time to time, the Trustee shall make payments of alladministrative expenses (including taxes,ireasonable out-of-pocket

expenses, and the Trustee's fees as specified in the agreement referred to in Section 4.03) (collectively, the "Administrative Expenses")

in connection with the operation of the Master Trust pursuant to this Agreement Allsuch Administrative Expenses and incidental expenses of the Master Trust shall be allocated proportionately among the Funds (based on the fair market value of each Fund immediately priorto any such payment) and within each Fund among the subaccounts in the proportion that thebalance in each subaccount bears to the aggregate balance of all subaccounts in such Fund;provided, that income taxes shall be paid for each of the Funds in accordance with the incometax actually imposed on each such Fund. The Trustee shall maintain such records as arenecessary to reflect the allocation of Administrative Expenses and incidental expenses among theFunds in accordance with this Section 4.02. If the assets of any Fund or subaccount thereof areinsufficient to permit the payment in full of amounts payable under this Section 4.02, the Trusteeshall have no liability with respect to such insufficiency and no obligation to use its own funds topay the same.4.03 Fees. The Trustee shall receive as exclusive compensation for its services suchamounts as may from time to time be agreed to by the Trustee and the Company.4.04 Liquidation of Investments.

At the direction of the Company or its Investment

Manager, the Trustee shall sell or liquidate such investments of the Funds as may be specified.

The proceeds of any such sale or liquidation shall be credited pro rata to the Fund or Funds andwithin each Fund to the subaccount or subaccounts thereunder to which such investments werecredited prior to such sale or liquidation.

4.05 Notice to the NRC. Notwithstanding anything in this Agreement to the contrary, no disbursements or payments shall be made by the Trustee,.

other than Administrative Expenses8LIBC/1548679.7 in accordance with Section 4.02, until the Trustee has first given the NRC thirty (30) days' priorwritten notice of payment;

provided, however, that no disbursement or payment from this MasterTrust shall be made if the Trustee receives prior written notice of objection from the Director, Office of Nuclear Reactor Regulation (the "NRR Director").

After the Company has firstauthorized the Trustee to disburse funds from the Master Trust to pay Decommissioning.Costs inaccordance with 10 CFR 50.82(a)(8)(i) or other applicable NRC Regulation, the Trustee will nolonger be obligated to notify the NRC for subsequent disbursements or payments in connection with Decommissioning the Station.4.06 Approval by State of Vermont Public Service Board. In the event the Companyshall request disbursements or payments from this Master Trust other than pursuant to Section4.01 (Decommissioning costs including costs for decommissioning, spent fuel storage and siterestoration contemplated under Exhibit D pursuant to Section 5.01), Section 4.02 (Administrative Expenses includ'ng Trustee fees and income taxes) or Section 5.02 (termination),

then in suchother case the Cqmpany shall have received the approval for such disbursement or payment fromthe State of Vermont Public Service Board (or its successor).

ARTICLE V.TERMINATION 5.01 Termination of Funds and Trust in General.

Each Fund established hereunder shall terminate only upon the earlier of (i) the date on which the Trustee receiveswritten notification from an Authorized Representative of the occurrence of both the"Completion of Decommissioning" (as defined in Exhibit D) and the satisfaction of the otherrequirements regarding the conditions precedent for the return of excess funds set forth inExhibit D; or (ii) twenty-one (21) years after the death of the last survivor of each person whowas an officer,

director, member, or manager of the Company on the date of this Agreement andeach of their descendants born on or prior to that date. This Master Trust shall terminate uponthe termination of all of the Funds. Prior to its termination, this Master Trust shall beirrevocable.

5.02 Distribution of Master Trust and Funds Upon Termination.

Without limitation ofSection 3.01 of this Agreement, upon termination of this Master Trust or of the Funds withrespect to the Station, the Trustee shall liquidate the assets of the Master Trust or such Funds, asthe case may be, and distribute the Excess Funds (which shall not include funds necessary forSpent Fuel Costs and Site Restoration Costs) held in such Funds (less all reasonable finalAdministrative Expenses),

unless otherwise determined, ordered or required by anyGovernmental Authority, to VYNPC as provided in Exhibit D and for the benefit of the Sponsorsin pro rata shares in proportion to the stated ownership percentage of the Sponsors set forth onExhibit E. The term Excess Funds shall not include any amounts contributed by the Companyafter the date of this Agreement pursuant to Section 3.01, or any amounts of net income inrespect of such amounts, all of which amounts shall be distributed to the Company uponliquidation of the assets of the Master Trust or Funds. Further, upon termination of this MasterTrust or such Funds, the Trustee shall distribute all funds necessary for Spent Fuel Costs and SiteRestoration Costs to the Company.

An Authorized Representative will provide the Trustee with9LIBC/1548679.7 one or more written notices regarding the timing and amount of distributions to be madepursuant to this Section 5.02 and also of the satisfaction of the coriditions precedent regarding thereturn of Excess Funds set forth in Exhibit D. The Trustee shall be permitted to relyconclusively upon any written notification received from an Authorized Representative relatingto matters arising under Exhibit D or as to any determination, order or decision of Governmental Authorities.

5.03 Assignment of Right to Receive Payment of Excess Funds. Notwithstanding anything in this Agreement, including Section 5.02 or Exhibit D to the contrary, VYNPC andeach of the Sponsors shall each have the right to irrevocably transfer all of their respective right,title and interest to receive Excess Funds under this Agreement.

The party assigning its rights toreceive excess funds shall notify the Trustee in a writing signed by a duly authorized representative of the assigning entity upon such assignment, using the form of assignment attached heretoas Exhibit F. The Trustee may rely conclusively upon any notice of assignment and such assignment shall be binding upon the Company, the Trustee, the assigning party andeach of their respective successors,

assigns, personal representatives, executors and heirs. Uponreceipt of notice of an assignment, the Trustee shall thereafter deliver the excess funds, if anyand at the time otherwise distributable pursuant to Section 5.02, directly to the named assignee, notwithstanding the provisions of Section 5.02 and Exhibit D.4RTICLE VI.TRUSTEES6.01 Designation and Qualification of Successor Trustee(s).

(a) At any time during the term of this Master Trust, the Company shall havethe right to remove the Trustee (at the Company's sole discretion) acting hereunder and appointanother qualified entity as a successor Trustee upon thirty (30) days' notice in writing to theTrustee, or upon such shorter notice as may be acceptable to the Trustee.

In the event that thebank or trust company serving as Trustee or successor Trustee shall: (i) become insolvent oradmit in writing its insolvency; (ii) be unable or admit in writing its inability to pay its debts assuch debts mature; (iii) make a general assignment for the benefit of creditors; (iv) have aninvoluntary petition in bankruptcy filed against it; (v) commence a case under or otherwise seekto take advantage of any bankruptcy, reorganization, insolvency, readjustment of debt,dissolution or liquidation law, statute, or proceeding; or (vi) resign, the Company shall appoint asuccessor Trustee as soon as practicable.

In the event of any such removal or resignation, the,Trustee or successor Trustee shall have the right to have its accounts finalized as provided inSection 6.05. Any successor to the Company, as provided herein, shall have the same right toremove and to appoint any Trustee or successor Trustee.(b) Any successor Trustee shall be a bank or trust company incorporated anddoing business within the United States of America and having a combined capital and surplus ofat least Two Hundred Fifty Million Dollars ($250,000,000),

if there be such an institution

willing, able and legally qualified to perform the duties of Trustee hereunder upon reasonable orcustomary terms.10LIBC/1548679.7 (c) Any successor Trustee shall qualify by a duly acknowledged acceptance ofthis Master Trust, delivered to the Company.

Upon acceptance of silch appointment by thesuccessor

Trustee, the Trustee shall assign, transfer and pay over to such successor Trustee theassets then constituting the Master Trust. Any successor Trustee shall have all the rights, powers,duties and obligations herein granted to the original Trustee.6.02 Exoneration from Bond. No bond or other security shall be exacted or required ofany Trustee or successor Trustee appointed pursuant to this Agreement.

6.03 Resignation.

The Trustee or any successor Trustee hereof may resign and berelieved as Trustee at any time without prior application to or approval by or order of any courtby a duly acknowledged instrument, which shall be delivered to the Company by the Trustee noless than thirty (30) days prior to the effective date of the Trustee's resignation or upon suchshorter notice as may be acceptable to the Company.

If for any reason the Company cannot ordoes not act in t4e event of the resignation of the Trustee, the Trustee may apply to a court ofcompetent jurisdiction for the appointment of a successor Trustee and the cost of making suchapplication shall be an Administrative Expense.6.04 Transactions with Third Parties.

No person or organization dealing with theTrustee hereunder shall be required to inquire into or to investigate its authority for entering intoany transaction or to see to the application of the proceeds of any such transaction.

6.05 Accounts and Reports.(a) The Trustee shall keep accurate and detailed accounts of all investments, receipts and disbursements and other transactions hereunder with respect to each Fund and eachsubaccount thereunder in accordance with specifications of the Company, and all accounts, books and records relating thereto shall be open to inspection and audit at all reasonable times byany person designated by the Company.

Within twenty-five (25) days following the close ofeach month, the Trustee shall provide a written report of the estimated market value of eachFund and each subaccount thereunder, prepared on an accrual basis. Within thirty-five (35) daysfollowing the close of each month, the Trustee shall file with the Company a final written reportsetting forth all investments, receipts and disbursements and other transactions effected by itduring the month and containing an exact description of all cash and securities contributed, purchased, sold or distributed and the cost or net proceeds of sale, and showing all cash, andsecurities and other investments held at the end of such month and the cost and fair market valueof each item thereof as carried on the books of the Trustee.

Such accounts and reports shall bebased on the accrual method of reporting net income and expenses and shall show the portion ofthe assets applicable to each Fund and subaccount thereunder and shall also identify alldisbursements from each Fund and subaccount thereunder.

(b) Upon the expiration of ninety (90) days from the date of filing suchwritten reports with the Company, the Trustee shall be forever released and discharged from allliability or accountability to anyone with respect to all acts and transactions shown in suchwritten reports, except such acts or transactions as to which the Company shall take exception bywritten notice to the Trustee within such ninety (90) day period; provided,

however, that nothingcontained in this Section 6.05(b) shall be deemed to relieve the Trustee of any liability imposedI1LIBC/1548679.7 pursuant to Section 6.07. In the event that any exception taken by the Company cannot beamicably

adjusted, the Company may, within one (1) year of the date of such exception, file thewritten report in a court having jurisdiction and upon the audit thereof any and all suchexceptions which may not have been amicably settled shall be heard and adjudicated.

Anyexception not so filed within one (1) year shall be deemed waived and any liability of the Trusteewith respect thereto shall be deemed released.

(c) All records and accounts maintained by the Trustee with respect to theMaster Trust and the Funds shall be preserved for such period as the Company shall specify andin the absence of any instructions from the Company shall be preserved for a period of four (4)years. Upon the expiration of any such required retention period, the Trustee shall have the rightto destroy such records and accounts after first notifying the Company in writing of its intention and transferring to the Company any records and accounts requested by the Company.6.06 Tax Returns and Other Reports.

The Company, or the Trustee at the Company's direction, shall Orepare and file all federal, state and local income or franchise tax returns andother reports (including estimated tax returns and information returns) as may be required fromtime to time with respect to the Qualified Fund, and the Trustee agrees to provide the Companyin a timely manner with any information which is necessary to such filings which is not in thepossession of the Company.

The Trustee shall prepare and submit to the Company in a timelymanner all information requested by the Company regarding the Funds required to be included inthe Company's

federal, state and local income tax returns or other reports (including tax returnsand information returns).

The Trustee may employ independent certified public accountants orother tax counsel to prepare or review such returns and reports and the reasonable cost thereofshall be an Administrative Expense.

The Trustee agrees to sign any tax returns or other reportswhere required by law to do so or arising out of the Trustee's responsibilities hereunder, and toremit from the Master Trust appropriate payments or deposits of federal, state and local incomeor franchise taxes directly to the taxing agencies or authorized depositaries or to the Company, inthe event that the Company has directly paid such taxes. Any interest or penalty chargesassessed against the Master Trust pursuant to Chapters 67 or 68 of the Code or pursuant to anysimilar state or local tax provisions, as a result of the Trustee's failure to comply with thisSection 6.06 shall be an Administrative Expense unless caused by the Trustee's negligence orwillful misconduct in which case such interest or penalty charges shall be borne by the Trusteeand not the Master Trust. The Trustee agrees to notify the Company in writing within ten (10)days of the commencement of the audit of the Qualified Fund's federal, state or local tax returns,and to participate with the Company on behalf of the Qualified Fund in such audits and relatedinquiries.

The Trustee further agrees to provide the Company with any additional information inits possession regarding the Master Trust that may be requested by the Company to be furnished in an audit of the Company's

federal, state or local tax returns.6.07 Liability.

(a) The Trustee shall not be liable for any loss or injury resulting from itsactions or its performance of its duties hereunder or for its investment decisions in the absence ofits own willful misconduct or negligence.

In no event shall the Trustee be liable (i) for acting inaccordance with instructions from an Authorized Representative or a duly designated delegate orpursuant to a legal opinion of counsel to the Trustee or to the Company, or (ii) for special or12LIBC/1548679.7 consequential damages or (iii) for any losses resulting from the deposit or maintenance ofsecurities or other property (in accordance with market practice, cuitom, or regulation) with anyrecognized foreign or domestic clearing

facility, book-entity system, centralized custodial depository, or similar organization.

(b) Notwithstanding anything contained in this Agreement to the contrary, upon receipt of written notice from the Company (satisfactory in form to the Trustee) identifying persons and entities as "disqualified persons" which may not engage in transactions with theMaster Trust because to do so would constitute "self-dealing" pursuant to CodeSection 468A(e)(5)

Or Code Section 4951 (or any applicable successor provisions),

the Trusteeshall refrain from authorizing or carrying out the transactions with such "disqualified persons"unless the decision to so refrain would require knowledge of facts not apparent on the face ofsuch transaction.

In this latter case, the Trustee will so refrain only if it has knowledge of thepertinent facts and shall be under nio obligation to determine the facts. If the Trustee authorizes or carries out any transaction in violation of the provisions of this clause (1),) the Trustee (and notthe Master Trust or the Qualified Fund) shall be liable for any tax imposed on the Master Trust,the Qualified Fund, or the Trustee pursuant to Code Section 4951 (or any applicable successor provision) and for any loss or damage sustained by the Master Trust, the Qualified Fund, or theCompany.

Otherwise, the Trustee shall not be liable for any such tax or loss.(c) The Company shall indemnify the Trustee and hold it harmless againstany and all claims, losses, liabilities, excis6 taxes, damages or reasonable, expenses (including attorneys' fees and expenses) arising from or in connection with this Agreement or theperformance of its duties hereunder, together with any income taxes imposed on the Trustee as aresult of any indemnity paid by it hereunder,

provided, however, that nothing contained herein* shall require that the Trustee be indemnified for any liability imposed pursuant to clauses (a) or(b) of this Section 6.07. Nothing contained herein shall limit or in any way impair the right ofthe Trustee to indemnification under any other provision of this Agreement.

(d) The Company understands that when and if the Trustee delivers propertyagainst payment, it may deliver such property prior to receiving final payment and that, as amatter of bookkeeping convenience, the Trustee may credit one or more of the Funds withanticipated proceeds of sale prior to actual receipt of final payment.

The risks of non-receipt ofpayment shall be the Company's and the.Trustee shall have no liability therefore.

(e) All credits to the Funds of the proceeds of sales and redemptions ofproperty and of anticipated income from property shall be conditional upon receipt by theTrustee of final payment and may be reversed to the extent final payment is not received.

In theevent that the Trustee in its discretion advances funds to the Master Trust to facilitate thesettlement of any transaction, the Master Trust shall, immediately upon demand, reimburse theTrustee for such amounts plus any interest

thereon, and to secure such obligations as well as anyother obligations of the Master Trust hereunder, the Company, to the extent permitted byApplicable Law, hereby grants a continuing security interest in and pledges to the Trustee theproperty in the Funds and any funds so credited.

13LIBCII 548679.7 (f) The provisions of this Section 6.07 and the right of the Trustee to claimthe benefit thereof shall survive any termination of this Agreement and any resignation orremoval of the Trustee.ARTICLE VII.TRUSTEE'S GENERAL POWERSThe Trustee shall have, with respect to the Master Trust, the following powers, all ofwhich powers are fiduciary powers to be exercised in a fiduciary capacity and in the bestinterests of this Master Trust and the purposes hereof, namely:7.01 Registration of Securities.

To hold any stocks, bonds, securities, and/or otherproperty in the name of a nominee, in a street name, or by other title-holding device, withoutindication of tr4st and generally to exercise the powers of an owner, including, withoutlimitation, the Oower to vote in accordance with instructions provided by the Company, withrespect to any such property whether so held or held in its own name, as Trustee.7.02 Borrowing.

To borrow money in such amounts and upon such terms as theCompany may authorize in writing as necessary to carry out the purposes of this Master Trust,and to pledge any securities or other property for the repayment of any such loan as theCompany may direct. j7.03 Retention and Removal of Professional and Employee Services.

To employ suchattorneys, accountants, custodians, engineers, contractors, clerks and agents as may bereasonably necessary to carry out the purposes of this Master Trust- The reasonable cost of anysuch employment shall be an Administrative Expense.7.04 Delegation of Ministerial Powers. To delegate to other persons such ministerial powers and duties as the Trustee may deem to be advisable.

7.05 Powers of Trustee to Continue Until Final Distribution.

To exercise any of suchpowers after the date on which the principal and income of the Funds under the Master Trustshall have become distributable and until such time as the entire principal of, and income from,the Master Trust shall have been actually distributed by the Trustee.

It is intended that*distribution of the assets of one or more of the Funds under the Master Trust will occur as soonas possible after termination of the Master Trust or any Fund.7.06 Discretion in Exercise of Powers. To do any and all other acts which the Trustee.,shall deem proper to effectuate the powers specifically conferred upon it by this Agreement,

provided, however, that the Trustee may not do any act or participate in any transaction whichwould:(a) Contravene any provision of this Agreement; or(b) Violate the terms and conditions of any instructions provided in a writtenstatement of the Company.14LIBC/1548679.7 7.07 Deposit of Funds. To deposit funds in interest bearing account depositsmaintained by or savings certificates issued by the Trustee in its separate corporate

capacity, orin any other banking institution affiliated with the Trustee;

provided, however, that, the assets ofthe Qualified Fund may only be so deposited if the requirements of Applicable Tax Law are met.7.08 Loaning of Securities.

To loan securities to brokers or dealers or other borrowers under such terms and conditions as the Company authorizes pursuant to a separate agreement.

7.09 Retention of Uninvested Cash. To hold uninvested cash awaiting investment andsuch additional cash balances as it shall deem reasonable or necessary, without incurring anyliability for the payment of interest thereon.ARTICLE VIII.INVESTMENTS 8.01 General Investment Powers. The Company may appoint one or more investment

managers, which may include the Trustee, but shall not include the Company, to direct theinvestment of all or part of the Master Trust and, as to the Qualified Fund, in accordance with thelimitations set forth in Applicable Tax Law; provided,

however, that such investments are inconformance with the permitted investments as set forth in Exhibit A. (Each such investment manager is referred to herein as an "Investment Manager" and collectively as "Investment Managers.")

The Company shall also have the right'to remove such Investment Manager(s).

Whenever such appointment is made, the Company shall provide written notice of suchappointment to the Trustee, shall specify the portion of the Master Trust with respect to whichthe Investment Manager has been designated, and shall instruct the Trustee to segregate intospecified accounts those assets designated for management by each Investment Manager (eachsuch account is referred to herein as an "Investment Account").

To the extent that assets aresegregated into an Investment

Account, the Trustee shall be released and relieved of allinvestment duties, responsibilities and liabilities customarily or statutorily incident to a trusteewith respect to the assets in each such Investment

Account, and as to such Investment Accountthe Trustee shall act as custodian.

The Company shall cause the Investment Manager to certify inwriting to the Trustee the identity of the person or persons authorized to give instructions ordirections to the Trustee on behalf of such Investment Manager and to provide specimensignatures of such persons.

The Trustee may continue to rely upon and comply with all suchcertifications unless and until otherwise notified in writing by the Company or an Investment

Manager, as the case may be. Notwithstanding anything else in this Agreement to the contrary, including, without limitation, any specific or general power granted to the Trustee and to theInvestment

Managers, including the power to invest in real property, no portion of the Fundsshall be invested in real estate. For this purpose "real estate" includes, but is not limited to, realproperty, leaseholds or mineral interests.

8.02 Direction by Investment Manager(s).

(a) An Investment Manager designated by the Company to manage anInvestment Account shall have authority to manage and to direct the acquisition and disposition of the assets of the Master Trust, or a portion thereof, as the case may be, and the Trustee shall15LIBC/1548679.7 exercise the powers set forth in Article VIII only when, if, and in the manner directed by theCompany in writing, and shall not be under any obligation to invest or otherwise manage anyassets in the Investment Account.

An Investment Manager shall have the power and authority, exercisable in its sole discretion at any time, and from time to time, to issue and place orders forthe purchase or sale of portfolio securities directly with qualified brokers or dealers.

The-Trustee, upon proper notification from an Investment

Manager, shall settle the transactions in accordance with the appropriate trading authorizations.

The Company shall cause each Investment Managerto promptly provide to the Trustee written notification of each transaction and shall cause eachsuch Investment Manager to confirm in writing (or cause the broker or dealer to confirm inwriting) the settlement of each such transaction to the Trustee and to the Company.

Suchnotification shall be proper authority for the Trustee to pay for portfolio securities purchased against receipt thereof and to deliver portfolio securities sold against payment therefor, as thecase may be. All directions to the Trustee by an Investment Manager shall be in writing and shallbe signed by a pprson who has been certified by such Investment Manager pursuant toSection 8.01 as 4uthorized to give instructions or directions to the Trustee.(b) Should an Investment Manager at any time elect to place securitytransactions directly with a broker or a dealer, the Trustee shall not recognize such transaction unless and until it has received instructions or confirmation of such fact from an Investment Manager.

Should an Investment Manager direct the Trustee to utilize the services of any personwith regard to the assets under its management or control, such instructions shall be in writingand shall specifically set forth the actions tb be taken by the Trustee as to such services.

In theevent that an Investment Manager places security transactions directly or directs the utilization ofa. service, such Investment Manager shall be solely responsible for the acts of such persons.

Thesole duty of the Trustee as to such transactions shall be incident to its duties as custodian.

(c) The authority of an Investment Manager and the terms and conditions ofthe appointment and the retention of an Investment Manager shall be the sole responsibility ofthe Company, and the Trustee shall not be deemed to be a party or to have any obligations underany agreement with an Investment Manager.

Any duty of supervision or review of the acts,omissions or overall performance of each Investment Manager shall be the exclusive responsibility of the Company, and the Trustee shall have no duty to review any securities orother assets purchased by an Investment

Manager, or to make suggestions to an Investment Manager or to the Company with respect to the exercise or nonexercise of any power by anInvestment Manager.

Notwithstanding the foregoing, except in connection with the requirement that investments be in Investment-Grade Securities, the Trustee shall review all transactions ofwhich it is notified by an Investment Manager to determine if such transactions are inconformance with the permitted investments as set forth in Exhibit A, and if they are not, to sonotify the Company and the Investment Manager.8.03 Trustee's General Investment Powers.(a) The Trustee recognizes the authority of an Investment Manager tomanage, invest, and reinvest the assets in an Investment Account pursuant to an investment manager agreement and as provided in this Article VIII, and the Trustee agrees to cooperate withany Investment Manager as deemed necessary to accomplish these tasks. Notwithstanding theforegoing, to the extent that the assets of the Master Trust have not been segregated into an16LIBCII 548679.7 Investment Account to be invested by an Investment

Manager, the Trustee may agree to conductthe day-to-day investment management of such assets in accordance with the written generalinvestment instructions of the Company and, as to the Qualified Fund, in accordance with thelimitations set forth in Applicable Tax Law.(b) Nothing in this Agreement shall restrict the Trustee, in its individual

capacity, from acting as an agent for, providing

banking, investment

advisory, investment management and other services to, and generally engaging in any kind of business with others(including, without limiting the generality of the foregoing, issuers of securities, of moneymarket instruments or of other property purchased by or on behalf of the Master Trust or any ofthe Funds) to the same extent as if it was not the Trustee hereunder.

Nothing in this Agreement shall in any way be deemed to restrict the right of the Trustee, in its individual

capacity, toperform services for any other person or entity, and the performance of such services for otherswill not be deetred to violate or give rise to any duty or obligation to the Company or the MasterTrust not specifically undertaken by the Trustee hereunder.

Nothing in this Agreement shalllimit or restrict the Trustee, in its individual

capacity, or any of its officers, affiliates oremployees from buying, selling or trading in any securities for its or their own accounts.

TheTrustee, in its individual

capacity, its officers, employees or affiliates, and its other clients may atany time have, acquire,

increase, decrease or dispose of positions in investments which are at thesame time being acquired or disposed of for the account of the Master Trust or one or more ofthe Funds. The Trustee shall have no obligation to acquire for the Master Trust or any of theFunds a position in any property which it acquires in its individual

capacity, or which its officers, employees or affiliates may acquire for its or their own accounts or for the account of a client.The Trustee may invest in any collective, common or pooled trust fund operated or maintained exclusively for the commingling and collective investment of monies or other assets including any such fund operated or maintained by the Trustee or an affiliate.

The Company expressly understands and agrees that any such collective fund may provide for the lending of its securities by the collective fund trustee and that such collective fund trustee will receive compensation forthe lending of securities that is separate from any compensation of the Trustee hereunder, or anycompensation of the collective fund trustee for the management of such collective fund. TheTrustee is authorized to invest in a collective fund which invests in Mellon Financial Corporation stock in accordance with the terms and conditions of the Department of Labor Prohibited Transaction Exemption 95-56 (the "Exemption")

granted to the Trustee and its affiliates and touse a cross-trading progran in accordance with the Exemption.

The Company acknowledges receipt of the notice entitled "Cross-Trading Information",

a copy of which is attached to thisAgreement as Exhibit C. The Trustee may purchase, enter, sell, hold, and generally deal in anymanner in and with contracts for the immediate or future delivery of financial instruments of anyissuer or of any other property; to grant, purchase, sell, exercise, permit to expire, permit to be'held in escrow, and otherwise to acquire, dispose of, hold and generally deal in any manner withand in all forms of option in any combination.

17LIBC/ 548679.7 ARTICLE IX.MISCELLANEOUS 9.01 Headings.

The section headings set forth in this Agreement and the Table ofContents are inserted for convenience of reference only and shall be disregarded in theconstruction or interpretation of any of the provisions of this Agreement.

9.02 Interpretation.

When a reference is made in this Agreement to an Article, Section,Schedule or Exhibit, such reference shall be to an Article or Section of, or Schedule or Exhibitto, this Agreement unless otherwise indicated.

Any word contained in the text of this Agreement shall be read as the singular or plural and as the masculine,

feminine, or neuter as may beapplicable or permissible in the particular context.

Unless otherwise specifically stated, the word"person" shall be taken to mean and include an individual, partnership, association, trust,company or corporation.

I9.03 Severability of Provisions.

If any provision of this Agreement or its application toany person or entity or in any circumstances shall be invalid and unenforceable, the application of such provision to persons and in circumstances other than those as to which it is invalid orunenforceable and the other provisions of this Agreement, shall not be affected by suchinvalidity or unenforceability.

9.04 Delivery of Notices Under Agreement.

Any notice, direction or instruction required by this Agreement to be given to the Company or the Trustee shall be deemed to havebeen properly given when delivered by personal

service, mailed, postage prepaid, by registered or certified mail, to the person to be notified as set forth below:If to the Company:Entergy Nuclear Vermont Yankee, LLCc/o Entergy Nuclear Operations, Inc.440 Hamilton AvenueWhite Plains, NY 10601Fax No.: 914-272-3205 Attention:

Chief Operating Officerwith a copy to:Entergy Nuclear, Inc.P.O. Box 31995Jackson, MS 39286-1995 Attention:

Assistant Secretary If to the Trustee:Mellon Bank, N.A.500 Grant Street, Room 132018LIBC/J 548679.7 Pittsburgh, PA 15258Attention:

Mr. Glen MetzgerThe Company or the Trustee may change the above address by delivering notice thereof inwriting to the other party.9.05 Alterations and Amendments.

(a) The Trustee and the Company understand and agree that modifications oramendments may be required to this Agreement, and to the exhibits hereto, from time to time toeffectuate the purpose of the Master Trust and to comply with Applicable Law, Applicable TaxLaw, any Order, any changes in tax laws, Regulations or rulings (whether published or private)of the Service and any similar state taxing authority, and any other changes in the lawsapplicable to the Company or the Station.

This Agreement, and the exhibits hereto may bealtered or amended to the extent necessary or advisable to effectuate such purposes or to complywith such Applicable Law, Applicable Tax Law, Order or changes.(b) Except as provided in clause (a) and (d) of this Section 9.05, thisAgreement, and the exhibits hereto, may be amended,

modified, or altered for any purposerequested by the Company so long as such amendment, modification, or alteration does notaffect the use of the assets of any Fund to pay the costs of Decommissioning.

Notwithstanding the foregoing, this Agreement shall not be amended so as to violate Code Section 468A or theRegulations thereunder, as amended from time to time.(c) Any alteration or amendment to, or modification of, this Agreement or anexhibit hereto must be in writing and signed by the Company and the Trustee.

The Trustee shallexecute any such alteration, modification, or amendment required to be executed by it and shallaccept and be governed by any amended, modified or altered schedule delivered to it but shallhave no duty to inquire or make any investigation as to whether any amendment, modification oralteration is consistent with this Section 9.05.(d) Notwithstanding anything in this Section 9.05 to the contrary, thisAgreement cannot be amended in any material respect without (30) days' prior written notice tothe NRR Director;

provided, however, that if the Company receives prior written notice ofobjection from either the NRR Director or the Nuclear Safety Director, as appropriate, no suchmaterial amendment, modification or alteration shall be made.(e) Notwithstanding anything in this Section 9.05 to the contrary, noamendment, modification or alteration of this Agreement shall become effective unless theCompany shall have provided at least thirty (30) days' notice to the State of Vermont PublicService Board and the State of Vermont Department of Public Service (or their successors, ifany) of its intent to amend, modify or alter this Agreement.

In addition, the Company shall notamend, modify or alter any of the terms of Sections 5.01 and 5.02 without the prior approval ofthe State of Vermont Public Service Board.19LIBC/1548679.7 9.06 Successors and Assigns.

Subject to the provisions of Sections 2.09 and 6.01, thisAgreement shall be binding upon and inure to the benefit of the Company, the Trustee, and theirrespective successors,

assigns, personal representatives, executors and heirs.9.07 Governing Law; Jurisdiction; Certain Waivers.(a) This Agreement, the Master Trust and all questions pertaining to theirvalidity, construction, and administration shall be interpreted, construed and determined inaccordance with the internal substantive laws (and not the choice of law rules) of theCommonwealth of Pennsylvania to the extent not superseded by federal law. All actions andproceedings brought by the Trustee relating to or arising from, directly or indirectly, thisAgreement may be litigated in courts located in the Commonwealth of Pennsylvania and theCompany hereby submits to the jurisdiction of such courts. The Company and the Trusteehereby waive the right to a trial by jury in any action or proceeding brought hereunder.

(b) To the extent that, in any jurisdiction, the Company has or hereafter mayacquire, or is or hereafter may be entitled to claim, for itself or its assets, immunity (sovereign orotherwise) from suit, execution, attachment (before or after judgment) or any other legal processbrought by or on behalf of the Trustee and arising with respect to this Master Trust or theTrustee's functions hereunder, the Company irrevocably agrees not to claim, and hereby waives,such immunity.

9.08 Accounting Year. The Master Trust shall operate on an accounting year thatcoincides with the calendar year, January 1 through December 31.9.09 Counterparts.

This Agreement may be executed in any number of counterparts, each of which shall be an original, with the same effect as if the signatures thereto and heretowere upon the same instrument.

9.10 Decommissioning Liability.

Nothing in Agreement or in any supplement to thisAgreement is intended to impose any responsibility on the Trustee for overseeing or paying thecost of the Decommissioning of the Station, other than the disbursement of funds in accordance with Article IV.20LIBC/1548679.7 9.11 Limitation on Liability of Trustee.

Notwithstanding anything in this Agreement to the contrary, the Trustee shall not be responsible or liable for iti failure to perform under thisAgreement or for any losses to the Funds resulting from (a) any event beyond the reasonable control of the Trustee, its agents or subcustodians, including but not limited to nationalization,

strikes, expropriation, devaluation,

seizure, or similar action by any Governmental Authority, defacto or de jure, or (b) enactment, promulgation, imposition or enforcement by any suchGovernmental Authority of currency restrictions, exchange

controls, levels or other chargesaffecting the Funds' property, or (c) the breakdown, failure or malfunction of any utilities ortelecommunications

systems, or (d) any order or regulation of any banking or securities industryincluding changes in the market rules and market conditions affecting the execution or settlement of transactions, or (e) acts of war, terrorism, insurrection or revolution, or (I) acts of God; or anyother similar event. This Section 9.11 shall survive the termination of this Agreement.

9.12 Representation.

The Company and the Trustee hereby each represent and warrantto the other that- it has full authority to enter into this Agreement upon the terms and conditions hereof and that the individuals executing this Agreement on its behalf have the requisite authority to bind the Company and the Trustee to this Agreement.

21LIBC/I 548679.7 IN WITNESS WHEREOF, the Company and the Trustee have set their hands and sealsto this Agreement as of the day and year first above written.ENTERGY NUCLEAR VERMONTYANKEE, LLCBy:_______

Name: Steven C. McNealTitle: Vice President and Treasurer Attest: <MC&L~.C j~Name: Michael A. CarusoTitle: Assistant Treasurer MELLON BANK, N.A., as TrusteeBy:________________

Name:214arne:Gl 4(W'K i?1+zyTitle- AVPS-ILIBC/1548679.7 STATE OF LOUISIANA

)) ss:PARISH OF ORLEANS )I, iC _.Y)'44Y, a Notary Public in and for the aforesaid jurisdiction, do hereby certifythat Steven C. McNeal and Michael A. Caruso, who are personally known to me to be thepersons who executed the foregoing Entergy Nuclear Vermont Yankee, LLC MasterDecommissioning Trust Agreement, personally appeared before me in the aforesaid jurisdiction, and as Vice President and Treasurer and Assistant Treasurer of ENTERGY NUCLEARVERMONT YANKEE, LLC, and by virtue of the power and authority vested in them,acknowledged the same to be the act and deed of ENTERGY NUCLEAR VERMONTYANKEE, LLC'and they executed the same as such.Given under my hand and seal this of July, 2002.State of LfsianaMy commission is for lifeLISC/I548679.7 COMMONWEALTH OF PENNSYLVANIA

))ss:COUNTY OF________

).,,,, ,Notary Public in and for the aforesaid jurisdiction, do hereby certifthat --, 7-T.,_ and GAQ1 '. --,r ,who are personally known to meto be the persons who executed the foregoing Entergy Nuliar Vermont Yankee, LLC MasterDecommissioning Trust Agreement, personally appeared before me inW the aforesaid jurisdiction, and as a '- -and K,ý-. \2. \NV-k.i IMELLON BANK, N.A.,and by virtue of the power and authority v~ted in them, acknowledged the same to be the actand deed MELLON BANK, N.A., and they executed the same as such.Given under my hand and seal this 3Vday of July, 2002.ýIot PublicCommonwealth of Pennsylvania My commission expires C- ."? , ,.:O Notarial SealJuiie Ann Mosco, NWtary Pu~bicPittsburqh, Ailegheny tountyMy Commission Expires Oct. 13, 2003Mernber, Penrisyurflia BAss5a5-on oW. Nd.arieSLIBC/1548679.7 EXIMIT APERMITTED INVESTMENTS Permitted investments for both the Qualified Fund and the Nonqualified Fund(s).shall beany investments in Investment-Grade Securities permitted by Applicable Law; provided that,subject to clarification, if any, by the NRC, investments in securities settled or safekept outsideof the United States shall be prohibited and provided further that investments in the securities orother obligations of Entergy Corporation and its affiliates or subsidiaries, successors or assignsshall be prohibited.

In addition, except for investments tied to market indexes or other non-nuclear sector mutual funds, investments in any entity owning one or more nuclear power plantsare prohibited.

Permitted investments include investments tied to market indexes, mutual fundsor common trust funds which may hold securities issued by Entergy Corporation, its affiliates and subsidiaries.

/Exhibit A-ILIBC/1548679.7 EXHIBIT BDECOMMISSIONING CERTIFICATE NO.The undersigned Authorized Representative of Entergy Nuclear Vermont Yankee, LLC, aDelaware limited liability company (the "Company"),

being duly authorized and empowered toexecute and deliver this Decommissioning Certificate, hereby certifies that payments in theamounts and to the payees listed below are for obligations duly incurred by the Company for theDecommissioning of the Vermont Yankee Nuclear Power Station under Applicable Law or forSpent Fuel Costs or Site Restoration Costs or Docket 6545 Decommissioning Activities, to theextent permitted by the Master Trust, and hereby directs the Trustee of the Entergy NuclearVermont Yankee Master Decommissioning Trust, pursuant to Article IV of the Master TrustAgreement to pay to each payee listed, including the Company if so listed, (Payees) in Exhibit 1hereto, the amolints set forth therein, and certifies that the payments requested are properexpenditures of the Master Trust.Accordingly, request is hereby made that the Trustee provide for the withdrawal of$_ _from the (Qualified/Nonqualified)

Fund [and Subaccount(s)]

in order topermit payment of such sum to be made to the Payees. You are further requested to disburse suchsum, once withdrawn, directly to such Payees in the following manner:.

[CHECK/WIRE TRANSFER/

E] on or bef9re _, 20_.ENTERGY NUCLEAR VERMONTYANKEE, LLCBy:Name:Authorized Representative Exhibit B-ILIBC/ 1548679.7 EXHIBIT CCROSS-TRADING INFORMATION As part of the cross-trading program covered by the Exemption for the Trustee and itsaffiliates, the Trustee is to provide to each affected Trust the following information:

1. The existence of the cross-trading programThe Trustee has developed and intends to utilize, wherever practicable, across-trading program for Indexed Accounts and Large Accounts as those termsare defined in the Exemption.

Ii. The "triggering events" creating cross-trade opportunities In accordance with the exemption three "triggering events" may createopportunities for cross-trading transactions.

They are generally the following (seethe Exemption for more information):

A. A change in the composition or weighting of the index by the independent organization creating and maintaining the index;B. A change in the overall level of investment in an Indexed Account as aresult of investments and withdrawals of the account's opening date,where the Account is a bank collective fund, or on any relevant date fornon-bank collective funds; provided,

however, a change in an IndexedAccount resulting from investments or withdrawals of assets of theTrustee's own plans (other than the Trustee's defined contribution plansunder which participants may direct among various investment options,including Indexed Accounts) are excluded as a "triggering event"; orC. A recorded declaration by the Trustee that an accumulation of cash in anIndexed Account attributable to interest or dividends on, and/or tenderoffers for, portfolio securities equal to not more than 0.5% of theAccount's total value has occurred.

Ill. The pricing mechanism utilized for securities purchased or soldSecurities will be valued at the current market value for the. securities onthe date of the crossing transaction.

Exhibit C-1IL1BC11548679.7 Equity securities

-the current market value of the equity security will be theclosing price on the day of trading as determined by an independent pricingser-vice; unless the security was added to or deleted from an index after the closeof trading, in which case the price will be the opening price for that security onthe next business day after the announcement of the addition or deletion..

Debt securities

-the current market value of the debt security will be the pricedetermined by the Trustee as of the close of the day of tading according to theSecurities and Exchange Commission's Rule 17a-7(b)(4) under the Investment Company Act of 1940.Debt securities that are not reported securities or traded on an exchange will bevalued based on an average of the highest current independent bids and the lowestcurrent independent offers on the day of cross-trading.

The Trustee will userIasonable inquiry to obtain such prices from at least three independent sourcesthat are brokers or market makers. If there are fewer than three independent sources to price a certain debt security, the closing price quotations will beobtained from all available sources.IV. The allocation methodsDirect cross-trade opportunities will be allocated among potential buyersor sellers of debt or equity securities on a prorata basis. With respect to equitysecurities, please note the Trustee imposes a trivial share constraint to reduceexcessive custody ticket charges to participating accounts.

V. Other procedures implemented by the Trustee for its cross-trading practices The Trustee has developed certain internal operational procedures forcross-trading debt and equity securities.

These procedures are available uponrequest.Exhibit C-2LIBC/1548679.7 EXHIBIT DDECOMMISSIONING REQUIREMENTS Upon Completion of Decommissioning (as defined below) of the Station, anyExcess Funds remaining in the decommissioniiig trust funds transferred fromVYNPC or the VYNPC Trust Funds pursuant to the Purchase and SaleAgreement, including any gains, losses or fees on the trust funds while held in afund hereunder

("transferred trust funds') shall be distributed in accordance withthe terms hereof The Completion of Decommissioning is defined for thepurposes of this Exhibit D as plant dismantlement and decontamination to NRCstandards plus the completion of additional activities agreed to or imposed in thecourse of Docket No. 6545 before the Vermont Public Service Commission orpursuant' to any subsequent law or proceeding, but excluding spent fuelmanagement and any site restoration

("Docket 6545 Decommissioning Activities").

Completion of Decommissioning shall be deemed to have occurredfor purposes hereof notwithstanding that the Company may choose to re-use theSite, and portions of existing structures, systems and components, and that spentfuel is not removed from the Site. Site restoration shall mean that, once the Site isno longer used for nuclear purposes or non-nuclear commercial, industrial orother similar uses consistent with1 the orderly development of the property, theSite will be restored by removal of all structures and, if appropriate, regrading andreseeding the land.Return of Excess Funds in accordance with the second following paragraph, shalloccur following the earliest of (i) the date Completion of Decommissioning hasoccurred and the Company has satisfied all of its responsibilities for spent fuelmanagement and site restoration or (ii) the date on which Completion ofDecommissioning occurs and any of the following occur: (x) settlement betweenthe Company and the US Department of Energy ("DOE") with respect to spentfuel management responsibilities for the Station, (y) final resolution of litigation by the Company against DOE with respect to spent fuel management responsibilities for the Station.

or (z) satisfactory performance by DOE of itsspent fuel responsibility with respect to the Station.Excess Funds shall mean any funds remaining in the transferred trust fundsfollowing the Completion of Decommissioning, less those funds necessary formanagement of spent nuclear fuel (including reasonable contingencies for delaysin removal of the spent fuel from the Site, or cost overruns associated with thestorage or removal of the spent fuel) (the "Spent Fuel Costs") and site restoration costs not otherwise payable by the federal government in accordance with (x), (y)or (z) above (the "Site Restoration Costs").

Excess Funds shall not include anyamounts contributed by the Company after the date of this Agreement pursuant toSection 3.01, or any amounts of net income in respect of such amounts, all ofwhich amounts are to be distributed to the Company upon liquidation of the assetsof the Master Trust.Exhibit D-1LIBC/1548679.7 Subject to the assignment provisions of Section 5.03 of the Master Trust, theExcess Funds remaining shall be paid to VYNPC for the benefit of electricconsumers in pro rata shares in proportion to the stated ownership percentage ofthe Sponsors set forth on Exhibit E. In the event V`YNPC shall have ceased.to exist at the time Excess Funds are to be distributed as provided above, theCompany shall notify the State of Vermont Public Service Department and thestate public utility commission or comparable regulatory body, that eitherpresently exercises or formerly exercised rate regulation authority over eachSponsor which is entitled to a distribution, that the pro rata share of Excess Fundsis available.

Upon compliance with the instructions of each such state publicutility commission or comparable regulatory body, the Company and the Trusteeholding such funds shall have no further obligation with regard to the ExcessFunds or their distribution.

Exhibit D-2LIBC/1548679.7 EXHIBIT ECentral Vermont Public Service Corporation 35.0%Green Mountain Power Corporation 20.0%New England Power Company 22.5%The Connecticut Light and Power Company 9.5%Central Maine Power Company 4.0%Public Service Company of New Hampshire 4.0%Western Massachusetts Electric Company 2.5%Cambridge Electric Light Company 2.5%Exhibit E-1LIBC/1548679.7 EXHIBIT FMellon Bank, N.A.500 grant Street, Room 1320Pittsburgh, PA 15258Attn: Mr. Glen Metzger

Dear Mr. Metzger:

Reference is mdde to the Entergy Nuclear Vermont Yankee, LLC Master Decommissioning Trust Agreement for Vermont Yankee Nuclear Power Station dated July _, 2002. Pursuant toSection 5.03 of such Master Trust, the undersigned hereby notifies you that it has irrevocably assigned its right to receive "Excess Funds" under the Master Trust to , itssuccessors and assigns.[Sponsor]

/,i t -Exhibit F-i1LIBC/1548679.7