[Federal Register Volume 63, Number 142 (Friday, July 24, 1998)]
[Notices]
[Pages 39911-39912]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 98-19803]


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NUCLEAR REGULATORY COMMISSION

[Docket No. 50-410]


Central Hudson Gas & Electric Corp. (Nine Mile Point Nuclear 
Station Unit No. 2); Order Approving Application Regarding 
Restructuring of Central Hudson Gas & Electric Corporation by 
Establishment of a Holding Company Affecting License No. NPF-69, Nine 
Mile Point Nuclear Station, Unit No. 2

I

    Central Hudson Gas & Electric Corporation (Applicant) is licensed 
by the U.S. Nuclear Regulatory Commission (NRC or Commission) to own 
and possess a 9-percent interest in Nine Mile Point Nuclear Station, 
Unit 2 (NMP2), under Facility Operating License No. NPF-69, issued by 
the Commission on July 2, 1987. In addition to Applicant, the other 
owners who may possess, but not operate, NMP2 are New York State 
Electric & Gas Corporation with an 18-percent interest, Long Island 
Lighting Company with an 18-percent interest, and Rochester Gas and 
Electric Corporation with a 14-percent interest. Niagara Mohawk Power 
Corporation (NMPC) owns a 41-percent interest in NMP2, is authorized to 
act as agent for the other owners, and has exclusive responsibility and 
control over the operation and maintenance of NMP2. NMP2 is located in 
the town of Scriba, Oswego County, New York.

II

    Under cover of a letter dated April 8, 1998, as resubmitted June 8, 
1998, and supplemented April 22, and July 9,1998, Applicant submitted 
an application for consent by the Commission, pursuant to 10 CFR 50.80, 
regarding a proposed corporate restructuring action that would result 
in the indirect transfer of the operating license for NMP2 to the 
extent it is held by Applicant. As a result of the proposed 
restructuring, Applicant would establish a new holding company and 
become a subsidiary of the new holding company, not yet named, to be 
created in accordance with an ``Amended and Restated Settlement 
Agreement'' dated January 2, 1998; as modified and approved by the New 
York State Public Service Commission's (PSC's) ``Order Adopting Terms 
of Settlement Subject to Modifications and Conditions'' (issued and 
effective February 19, 1998) in Case 96-E-0909, and further modified in 
the PSC's ``Modifications to Amended and Restated Settlement 
Agreement,'' dated February 26, 1998 (hereafter collectively known as 
``Settlement Agreement''). These documents constituting the Settlement 
Agreement were included with the application dated April 8, 1998.
    According to the application, the outstanding shares of Applicant's 
common stock would be exchanged on a share-for-share basis for common 
stock of the proposed new holding company, such that the holding 
company would own all of the outstanding common stock of Applicant. 
Also under the proposed restructuring, Applicant would sell at auction 
some of its fossil-fueled generating assets, but would continue to be 
an ``electric utility'' as defined in 10 CFR 50.2, providing the same 
utility services as it did before the restructuring. In addition, 
certain subsidiaries of Applicant would become subsidiaries of the new 
holding company. Applicant would retain its ownership interest in NMP2 
and would continue to be a licensee. No direct transfer of the 
operating license or interests in the station would result from the 
proposed restructuring. The transaction would not involve any change to 
either the management organization or technical personnel of NMPC, 
which has exclusive responsibility under the operating license for 
operating and maintaining NMP2 and which is not involved in the 
proposed restructuring of Applicant.
    Notice of the application for approval was published in the Federal 
Register on June 2, 1998 (63 FR 30025), and an Environmental Assessment 
and Finding of No Significant Impact was published in the Federal 
Register on June 25, 1998 (63 FR 34667).
    Under 10 CFR 50.80, no license shall be transferred, directly or 
indirectly, through transfer of control of the license, unless the 
Commission shall give its consent in writing. Upon review of the 
information submitted in the application of April 8, 1998, as 
resubmitted June 8, 1998, and supplemented by submittals dated April 
22, and July 9, 1998, the NRC staff has determined that the 
restructuring of Applicant by establishment of a holding company will 
not affect the qualifications of Applicant as a holder of the license, 
and that the transfer of control of the license for NMP2, to the extent 
effected by the restructuring, is otherwise consistent with applicable 
provisions of law, regulations, and orders issued by the Commission, 
subject to the conditions set forth herein. These findings are 
supported by a safety evaluation dated July 19, 1998.

III

    Accordingly, pursuant to Sections 161b, 161i, 161o, and 184 of the 
Atomic Energy Act of 1954, as amended, 42 USC Secs. 2201(b), 2201(i), 
2201(o), and 2234, and 10 CFR 50.80, IT IS HEREBY ORDERED that the 
Commission approves the application regarding the proposed 
restructuring of Applicant by the establishment of a holding company, 
subject to the following: (1) Applicant shall provide the Director, 
Office of Nuclear Reactor Regulation, a copy of any application, at the 
time it is filed, to transfer (excluding grants of security interests 
or liens) from Applicant to its proposed parent, or to any other 
affiliated company, facilities for the production, transmission, or 
distribution of electric energy having a depreciated book value 
exceeding 10 percent (10%) of Applicant's

[[Page 39912]]

consolidated net utility plant, as recorded on Applicant's books of 
account, and (2) should the restructuring of Applicant not be completed 
by July 19, 1999, this Order shall become null and void, provided, 
however, on application and for good cause shown, such date may be 
extended.
    This Order is effective upon issuance.

IV

    By August 19, 1998, any person adversely affected by this Order may 
file a request for a hearing with respect to issuance of the Order. Any 
person requesting a hearing shall set forth with particularity how that 
interest is adversely affected by this Order and shall address the 
criteria set forth in 10 CFR 2.714(d).
    If a hearing is to be held, the Commission will issue an order 
designating the time and place of the hearing.
    The issue to be considered at any such hearing shall be whether 
this Order should be sustained.
    Any request for a hearing must be filed with the Secretary of the 
Commission, U.S. Nuclear Regulatory Commission, Washington, DC 20555-
0001, Attention: Rulemakings and Adjudications Staff, or may be 
delivered to 11555 Rockville Pike, Rockville, Maryland, between 7:45 
a.m. and 4:15 p.m. Federal workdays, by the above date. Copies should 
be also sent to the Office of the General Counsel, and to the Director, 
Office of Nuclear Reactor Regulation, U.S. Nuclear Regulatory 
Commission, Washington, DC 20555, and to Ms. Ellen Ahearn, Corporate 
Secretary, Central Hudson Gas & Electric Corporation, 284 South Avenue, 
Poughkeepsie, NY 12601-4879.
    For further details with respect to this Order, see the application 
for approval dated April 8, 1998, as resubmitted under cover of a 
letter dated June 8, 1998, and supplemented by letters dated April 22, 
June 8, and July 9, 1998, which are available for public inspection at 
the Commission's Public Document Room, the Gelman Building, 2120 L 
Street, NW., Washington, DC, and at the local public document room 
located at the Reference and Documents Department, Penfield Library, 
State University of New York, Oswego, New York 13126.

    Dated at Rockville, Maryland, this 19th day of July, 1998.

    For the Nuclear Regulatory Commission.
Samuel J. Collins,
Director, Office of Nuclear Reactor Regulation.
[FR Doc. 98-19803 Filed 7-23-98; 8:45 am]
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