(Reuters) - Connecticut's Senate passed a bill Wednesday morning that could allow the state to buy power from Dominion Energy Inc's Millstone nuclear power plant.
Earlier this week, Dominion said it will begin a "strategic reassessment" of the 2,088-megawatt Millstone plant after another bill that would allow the state to buy power from the plant failed to get enough votes. That other bill was Senate Bill 106.
Senate Bill 778, which the Senate passed this morning, authorizes the commissioner of the state Department of Energy & Environmental Protection to conduct an appraisal to determine whether the state will conduct a competitive procurement process for nuclear power.
Before it becomes law, Bill 778 has to pass the state house before the session ends at midnight Wednesday and be signed by the governor.
Connecticut is one of several states looking for ways to boost their nuclear plants' revenues to keep them in service to preserve benefits they provide, including carbon-free energy, jobs, taxes and energy diversification.
In 2016, New York and Illinois adopted rules to subsidize some reactors that were in danger of closing before their licenses expire as cheap and abundant shale gas has cut power prices over the past several years, making it uneconomic for nuclear operators to keep some units operating.
While other generators with mostly gas-fired plants, like NRG Energy Inc, Dynegy Inc and Calpine Corp, challenge those New York and Illinois rules in federal court, other states - Ohio, Pennsylvania and New Jersey - have considered adopting similar rules to protect their reactors.
"We don't believe that fair and equitable power markets can be sustained when giving handouts or subsidies to nuclear operators. The suggestion that Dominion is somehow in a lesser position to participate in the power market is pure fiction," said NRG spokesman David Gaier.
If the Connecticut commissioner decides to go forward with the nuclear power purchases, the state can either require electric utilities to buy nuclear power for a period of three to ten years, or issue a solicitation for baseload zero-carbon resources, including nuclear.
Ken Holt, a spokesman at Millstone, said it was premature to speculate on what the company may do if Bill 778 does not pass.
He said Dominion has already sold 85 percent of the power Millstone is expected to generate in 2017 to hedge funds and other purchasers.
While the company usually sells some of the plant's power three years in advance, Holt said Dominion has not sold Millstone's power beyond this year because it was waiting to see where prices would go and the outcome of the legislation.
Next-day power prices in New England averaged $35.40 per megawatt hour in 2016, the lowest on record, according to Reuters data going back to 2001. That compares with a 10-year average (2007-2016) of $59.02.
(Reporting by Scott DiSavino; Editing by Phil Berlowitz)