BRATTLEBORO -- Prior to a discussion on Vermont Public Radio’s "Vermont Edition" between Jay Thayer, a vice president at Entergy, and Senate President Pro Tem Peter Shumlin over the fate of the Vermont Yankee nuclear power plant in Vernon, host Bob Kinzel asked VPR correspondent John Dillon, to describe how the Legislature gave itself the power to say yea or nay in the continued operation of Yankee.

When Yankee was built by a consortium of power utilities, the Legislature gave itself the authority over the siting of any new nuclear power plant in Vermont, said Dillon. The legislation also included the power to rule any power plant’s continued operation.

The Legislature does not have the power to relicense the plant. It only has the power to say whether it can continue its operation past 2012.

Vermont is the only state in the country with that authority, said Dillon.

"If it goes the wrong way for Entergy Nuclear Vermont Yankee," said Dillon, Entergy could raise the question of federal preemption and whether the state had the right to give itself that authority when the federal government has sole authority to relicense a nuclear power plant.

"There could be a court battle," said Dillon.

Dillon also talked about prices for electricity on the "spot market," which is defined as a market in which an asset that is bought or sold is delivered immediately.

Prices of electricity are low at this time, even lower than the 4.2 cents

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per kilowatt hour guaranteed to Vermonters through a contract signed with Entergy. That’s because demand for power has dropped due to the economic recession, said Dillon.

But rates fluctuate dramatically, said Dillon, depending on demand, especially during a hot summer or due to turmoil in the Middle East.

Entergy is currently negotiating a contract with Central Vermont Public Service and Green Mountain Power for a new power purchase agreement that would start in 2012 if Yankee continues operation.

Because of the low spot market rates, said Dillon, "This is not the best time for Entergy to be looking at locking in rates."

That’s because the low market price is a disincentive for utilities to lock in rates that are higher than current prices or that escalate over time, he said.

Because of that, said Dillon, Vermont utilities have been playing "hardball" with Entergy.

"They’ve got some real breathing room," he said.

Steve Costello, a spokesman for Central Vermont Public Service told the Reformer after the radio program that Entergy has not offered any contract proposals that contained the kind of value it believes will be necessary to gain approval of the plant’s relicensing.

"While a contract isn’t a requirement of relicensing, it’s clear the PSB and legislature want to see significant value from the plant if they are to approve it," said Costello.

The utilities recently sent out a request for proposals to supply electricity to the state.

The utilities asked for a total of 250 megawatts of energy, said Costello, and received bids for 1,000 megawatts.

"We have closed several deals for some significant power supplies, much of it renewable, but won’t announce the agreements until we have completed negotiations with one more party," he said.

Bob Audette can be reached at raudette@reformer.com, or at 802-254-2311, ext. 273.