BRATTLEBORO – The top Entergy Nuclear executive who admitted giving misleading statements to Vermont regulators about the existence of underground radioactive pipes at the Vermont Yankee reactor has been permanently relieved of his Vermont duties.

Jay Thayer has been placed on administrative leave pending the outcome of an internal investigation, Wayne Leonard, chairman and chief executive officer of Entergy Corp., told a group of nuclear industry analysts in a telephone conference call Tuesday. Leonard didn't name Thayer directly, but officials in Vermont confirmed his removal.

But while Entergy Corp. was addressing the immediate status of its top Vermont executive, it also raised its own questions about the future viability of the plant.

Leonard told the analysts Vermont Yankee was not profitable, not "covering" its capital costs, and was projected to lose money over the next two years.

Those two years represent the remaining two years on the reactor's federal license and the last two years of power contracts the plant has with Vermont utilities, all of which expire in 2012.

Leonard also said it didn't matter to Entergy's bottom line whether the Vermont plant continued to operate, but that its real value was to Vermont with its 650 well-paying jobs.

"It has to be profitable. And today, it is simply not covering its cost of capital," he said.

"It is a terrific plant. It would be a great loss to society as a whole to shut that plant down, but from a financial standpoint without some changes for Entergy it wouldn't make much difference in the bottom line," Leonard said, according to a transcript of the telephone conference call, explaining the need for a new power contract with utilities.

Leonard also said the internal investigation into allegations of misstatements to Vermont regulators, consultants hired by the Douglas administration and the Vermont Legislature was "drawing to a close."

He said the Vermont plant had "very good leads" on where the leaking tritium was coming from.

"We're narrowing it down pretty quickly," he said, according to transcripts of the conference call.

"We continue to believe Vermont Yankee represents a vital source of clean economical power that is safe, secure and reliable," he told the Wall Street analysts. "It is a model plant in many respects. …Vermont Yankee is among the elite in operating performance."

Entergy Nuclear officials in Vermont late Tuesday confirmed Thayer had been relieved of his Vermont duties and was on administrative leave.

In his place, Entergy is appointing a team to manage government affairs, and Brian Cosgrove, a longtime Entergy Nuclear member of the public relations team and former executive director of the Vermont Republican Party in the late 1980s and early 1990s, would be part of that effort.

Reaction to the news that Thayer had been removed from his job as the top Entergy official in Vermont was greeted with a wait-and-see attitude by the Douglas administration.

Gov. James Douglas had called for a management shakeup by Entergy last week. Tuesday evening he was en route to Washington, D.C., to meet with President Barack Obama to discuss energy policy, but his spokesman David Coriell said replacing one executive would not mean Vermont's trust could be automatically restored.

Coriell said the governor had been given a heads-up late Tuesday afternoon about Thayer.

"What really matters is the actions of the people who deal with the regulators. We'll reserve judgment until we see action," he said. "There needs to be a change in attitude and to take the regulatory process seriously."

Sen. Peter Shumlin, D-Windham, and president pro tempore of the Senate, voiced skepticism that Entergy Nuclear's corporate parent, Entergy Corp. of New Orleans, was going to make lasting changes.

"I don't think having a few heads roll means that Entergy Louisiana is going to do anything to restore Vermonters' confidence in their ability to tell the truth," said Shumlin, a gubernatorial candidate whose home district includes the Vernon reactor.

"It is clear to me that it is in Vermont's best interests to close the plant in 2012. We are operating an old tired plant that is polluting our groundwater and being run by a company that we can't trust," Shumlin said.

Shumlin said Entergy was hoping that by removing Thayer, it could shift attention from the main issue – that there was an uncontrolled and unknown radioactive leak underneath the Vernon plant.

Late Tuesday evening, Entergy released the results of the latest test on the new monitoring well that showed the highest tritium levels since the controversy erupted – the new well reached 80,000 picocuries per liter, up about 10,000 picocuries since Saturday when it was first tested. On Monday, it registered 75,300 picocuries.

The new level is four times the safe drinking water level established by the Environmental Protection Agency.

"What I'm concerned about is the tritium and cobalt that is leaking into the groundwater and into the Connecticut River, for which we can't seem to find the source of the problem. That's what we need to focus on. I would be more confident if Entergy Louisiana spent more time stopping the leak and less time having heads roll," Shumlin said.

James Moore, clean energy director for Vermont Public Interest Research Group, said one new executive "is not going to fix the corporate trust problems that Entergy has."

"They can play musical chairs and change leadership roles and titles, but none of those change the fact that Vermont Yankee isn't getting young and has more and more reliability issues," said Moore, who said VPIRG listened in on the Entergy call.

susan.smallheer@rutlandherald.com