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Blue Castle Testifies on Viability of Green River Nuclear Power



The radioactive glow of Utah’s potential nuclear future shone softly in a Price courtroom Monday afternoon, as Blue Castle Holdings defended its right to 53,600 acre-feet of water from the Green River to build the state’s first nuclear-power plant.---

HEALUtah, the Moab-based organization Uranium Watch and a mosaic of other environmental groups and private citizens have turned to the courts to stop the Blue Castle project, the aim of which is to build two nuclear reactors just outside the town of Green River.

Matt Pacenza, HEALUtah’s policy director, said that going the courts seemed like one of the few ways to impede the plant’s progress at a local level. “In the state of Utah, there are really just a couple of small ways for us to get involved,” he explained, “By far, the biggest is water.” The Nuclear Regulatory Commission, he says, rarely denies permits to applicants who complete the process.

Blue Castle spent the day presenting witnesses to support its case for keeping the water rights awarded the company by State Engineer Kent Jones in January 2012. Testimonies were devoted to supporting Blue Castle’s claims that the nuclear project is economically viable and will have negligible impacts on the environment and existing water rights. Environmental concerns include depletion of the river during low-flow periods, protection of the area’s endangered fish and decreased water quality.

Witnesses for the defense included Blue Castle CEO Aaron Tilton; former state engineer Jerry Olds; Thom Hardy, the chief science officer at the Meadows Center for Water & the Environment at Texas State University; and Blue Castle COO Tom Retson.

Tilton’s turn on the stand centered primarily on the financial viability of the project and his expected source of income, namely, the natural-gas-pipeline company and Blue Castle-subsidiary Willow Creek, as well as other investors. According to Pacenza, Blue Castle acquired Willow Creek in exchange for shares in the nuclear project. Lara Swensen, attorney for the plaintiffs, later questioned whether Willow Creek alone could provide the $100 million necessary for the Early Site Permit Blue Castle is in the process of obtaining. Tilton also stated that the application is presently halfway completed.

The second witness, Olds, testified to the state engineer’s process in considering water-rights applications, the current law regarding water rights, and the details of the Colorado River Compact, which allocates water usage among the western states. When questioned about what would happen to a potential nuclear reactor’s water needs in times of curtailment, Olds responded that the state is committed to a “recovery implementation program,” which would release water from Flaming Gorge Reservoir in order preserve existing rights and maintain environmental integrity in times of drought.

The former state engineer, however, expressed doubt at the notion of planning for future dry spells that may become more frequent, more severe and more persistent as a result of man-made climate change.

“None of us know the future. They’re trying to predict the weather in 2060. The weather guy can’t even get it right two weeks in the future,” Olds said.

Hardy, a former professor at Utah State University, spoke about research he conducted on the Green River and through Google Earth. He testified that his research confirmed a negligible impact on river flows, riverbeds and local fisheries. Hardy also further explained the recovery implementation program, in which different government agencies (including the U.S. Fish & Wildlife Service, the Utah Department of Water Resources and the Bureau of Reclamation) cooperate and make recommendations on the operation of Flaming Gorge. Hardy’s testimony centered on the fact that in most years, the Blue Castle reactors will draw a very small fraction of the Green River’s water; in fact, even in the driest years, the withdrawal will represent less than 10 percent of the river’s flow.

The final witness of the day was COO Retson, who expanded on many of Tilton’s earlier assertions about the viability of Blue Castle’s financial state. He claims that, in addition to the five founders of Blue Castle, the company has found 26 other investors. Retson explained Blue Castle’s business model, which is to sell a fully permitted site to investors. This model, Retson testified, minimizes risk to investors while increasing the efficiency of the process as a whole. He pointed to his partners’ “local expertise” and chief strategic officer Nils Diaz’s experience as former head of the NRC as major assets in expediting the permitting process. He also claimed that Blue Castle could fund the entirety of the Early Site Permit process, even if it finds no other investors at the time.

During the cross-examination, Swensen focused on the idea that a private firm with no intention of running a utility company could develop and then sell such a large and expensive project, particularly since no one company has as yet agreed to buy the power. The only other example Retson could cite was Horizon Nuclear Power, a U.K. company whose projects are currently delayed, according to Pacenza.

Sarah Fields, executive director of Uranium Watch, insists that these potential buyers of nuclear power don’t, in fact, exist. “We talked to almost every one [of the major utilities] and none are going to be a part of this project,” she insisted during a short recess. “None are interested in nuclear power.” Fields says that Blue Castle has been “very vague about who might participate … all they have is speculation.”

Pacenza worries that if the permits are granted, they could cause an undue burden on future generations of Utahns. Since the Early Site Permit doesn’t expire for 20 years and Pacenza believes that Blue Castle doesn’t have enough capital to complete the project, the permits, water rights and land could simply sit for a decade or more before being acted upon, regardless of local opinion.

The rest of the week will be devoted to more testimony, first from the defendants and then from the coalition of plaintiffs. Pacenza says HEAL’s lawyers will present experts in fish and hydrology to counter Blue Castle’s, as well as witnesses prepared to testify on nuclear safety and the prohibitive costs of nuclear investment, in the hope of swaying the judge to overturn the state engineer’s decision.

Despite the plaintiffs’ insistence that the Blue Castle Project is a boondoggle waiting to happen, Tilton remains optimistic. “I think people deserve an opportunity to understand what goes into [the nuclear-permitting process] and to understand companies that are proposing to do something in their community,” he said of the suit. Tilton also says he remains as confident as he was when interviewed by City Weekly in 2011 that his project will be completed successfully.