N.Y. man: Entergy lied about shortfall

The Nuclear Regulatory Commission has accepted a petition from a New York
man to investigate whether Entergy has lied about the adequacy of the
decommissioning funds for its nuclear power plants.

"Without swift and drastic enforcement action on the part of the NRC and its
staff, human health and the environment around these licensed facilities is
at risk and citizen safety (is) at risk," wrote Sherman Martinelli, of
Peekskill, N.Y., in a document he filed in August.

Martinelli lives within three miles of Entergy's Indian Point, in the Hudson
Valley.

On Dec. 17, the NRC responded that its Petition Review Board would consider
his allegations. The NRC also forwarded his claims of wrongdoing on the part
of the NRC to its Office of the Inspector General.

"The NRC staff's ongoing review indicates that only the decommissioning
trust funds for Entergy's Vermont Yankee and River Bend Nuclear Power Plants
do not currently meet the funding levels," wrote NRC. "The NRC staff has
engaged Entergy to resolve these deficiencies."

Martinelli wrote that Entergy's decommissioning funds are severely
underfunded due to "poor executive management clear up through the highest
level of Entergy's executive staff, combined with poor financial investment
decisions on the part of Entergy and its chosen financial investment
advisors."

He also accused Entergy of attempting to protect its assets through a
"mysterious and overly complicated corporate dummy corporation" that would
hold the licenses for its "various and assorted poorly run nuclear
facilities."

Entergy, which owns and operates Yankee in Vernon, has applied to the NRC to
spin off Yankee and four other nuclear power stations into a wholly
independent company named Enexus.

While the NRC, the Securities and Exchange Commission and the Federal Energy
Regulatory Commission have approved the spinoff, New York and Vermont have
delayed the process over concerns about Enexus' financial viability and
decommissioning funds for the power plants.

The plants involved in the spinoff include Yankee, Indian Point and
FitzPatrick in New York, Palisades in Michigan and Plymouth in
Massachusetts.

In his petition, Martinelli requested that the NRC suspend the operating
license of any Entergy plant with a decommissioning trust fund shortfall and
that it take action to ensure that any shortfalls in the decommissioning
trust funds be rectified.

A spokesman for Yankee said Entergy plans to provide by the end of the
month, a parent guarantee "that trues up the overall fund value to ensure
NRC expectations are met."

"Our continuing obligation as owner of Vermont Yankee is to ensure the fund
meets NRC requirements assuming a permanent shutdown in 2012," said Rob
Williams. "Volatility in the growth of the fund does not alter those
obligations in any way."

Martinelli also asked the NRC to investigate whether any of its staff had
"deliberately ignored false and untrue statements on financial assurances."

"NRC wrongfully and perhaps criminally seeks to provide false cover for
their licensees by claiming the recent economic disasters affecting the
American financial markets coupled with unexpected drops in decommissioning
funds invested in the stock market are the major contributing factor to
these decommissioning fund deficiencies," he wrote. "(The) NRC's job is to
assure compliance with its rules and regulations (and) to assure that its
licensees are meeting the minimum standards and amounts of money set aside
for decommissioning. It is not the NRC's job to make excuses for its
licensees, nor to excuse them from these minimum standards when the
licensees fail to meet the minimum standards ..."

Martinelli also wants to know if Entergy representatives provided "false
and/or untrue statements and assurances as relates to the adequacy of funds
for decommissioning" and if they have "deliberately or through sheer
ignorance, stupidity or negligence have in fact and deed provided false
statements."

He was especially concerned about documents filed in the Enexus spinoff and
in Entergy's license renewal applications.

"The NRC is reminded here that its own rules state that false statements and
misrepresentations in filings before the agency are the most significantly
and severe violation there is," wrote Martinelli.

The NRC shouldn't allow Entergy to use "overly optimistic and false future
predictions of growth in the decommissioning funds they currently have
invested in Wall Street," wrote Martinelli, and should be ordered to use
operating profits or loans from viable lending institutions to completely
fund the decommissioning funds.

Not only has Entergy allowed its decommissioning funds to dip to
unacceptable levels, wrote Martinelli, at the same time it has paid record
dividends to its shareholders.

Entergy is meeting all the requirements delineated in NRC regulations, said
Williams, which are designed to ensure proper funding over the long term.

"The oversight process works well and is able to respond to volatilities in
the growth of the fund, including requiring additional assurance," said
Williams. "In addition we have accepted the obligation for site restoration
costs that goes beyond NRC requirements to restore the site to a green
field."

Bob Audette can be reached at [email protected], or at 802-254-2311,
ext. 273.