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When there's no settings specified for the Rails.env that you are running, @yml will get the value nil. I got that error when running my tests and not specifying any settings for the test environment.
The rescue at the ending of line 114 in config.rb looked a little suspicious, the value incase of an exception would always have been {} and that rescue case would catch all exceptions, making the "rescue Psych::SyntaxError useless."
So maybe this solution is more inline with the intention of the writer, if the YAML.load... is nil set it to {}.