[Federal Register Volume 65, Number 229 (Tuesday, November 28, 2000)]
[Notices]
[Pages 70845-70847]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 00-30284]


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NUCLEAR REGULATORY COMMISSION

[Docket No. 50-333]


In the Matter of Power Authority of the State of New York; (James 
A. FitzPatrick Nuclear Power Plant); Order Approving Transfer of 
License and Conforming Amendment

I.

    The Power Authority of the State of New York (PASNY or the 
Authority) is the holder of Facility Operating License No. DPR-59, 
which authorizes operation of the James A. FitzPatrick Nuclear Power 
Plant (FitzPatrick or the facility) at steady-state power levels not in 
excess of 2536 megawatts thermal. The facility, which is owned by 
PASNY, is located in Oswego County, New York. The license authorizes 
PASNY to possess, use, and operate the facility.

II.

    Under cover of letters dated May 11, 2000, and May 12, 2000, PASNY, 
Entergy Nuclear FitzPatrick, LLC (Entergy Nuclear FitzPatrick), and 
Entergy Nuclear Operations, Inc. (ENO), submitted an application 
requesting approval of the proposed transfer of the FitzPatrick 
operating license to Entergy Nuclear FitzPatrick to possess and use and 
to ENO to possess, use, and operate FitzPatrick, and approval of a 
conforming amendment to reflect the transfer. The application was 
supplemented by letters dated June 13, June 16, July 14, September 21, 
October 26, and November 3, 2000.
    Entergy Nuclear FitzPatrick, a Delaware corporation, is a wholly 
owned indirect subsidiary of Entergy Corporation and an indirect wholly 
owned subsidiary of Entergy Nuclear Holding Company #1. ENO, a Delaware 
corporation, is an indirect wholly owned subsidiary of Entergy 
Corporation, and a direct wholly owned subsidiary of Entergy Nuclear 
Holding Company #2. After completion of the proposed transfer, Entergy 
Nuclear FitzPatrick would be the owner of FitzPatrick, and ENO would be 
the operator of FitzPatrick. The conforming amendment would remove the 
current licensee from the facility operating license and would add 
Entergy Nuclear FitzPatrick and ENO in its place, as appropriate.
    The applicants propose that, after the sale and transfer of 
FitzPatrick to Entergy Nuclear FitzPatrick, the Authority would retain 
all rights, title, and legal and beneficial interest in the 
decommissioning trust fund for the facility, while the trust fund would 
remain at all times committed to the decommissioning of FitzPatrick. 
The September 21, 2000, supplement to the application, filed by the 
Authority on behalf of itself and the other transfer applicants, 
includes the following proposals and commitments relating specifically 
to the Authority's retention of the decommissioning trust fund for 
FitzPatrick:
    (1) The Authority will waive any right to deny, contest or 
challenge the NRC's jurisdiction over the Authority with respect to 
FitzPatrick to the extent that there may arise in the future any matter 
warranting action by the NRC to ensure compliance with the NRC's 
decommissioning requirements regarding the disposition and use of the 
amounts accumulated in the decommissioning trust fund and retained by 
the Authority.
    (2) Upon the transfer of FitzPatrick, and pursuant to Section 7 of 
the decommissioning agreement between Entergy Nuclear FitzPatrick, 
Entergy Nuclear, Inc., and the Authority, Entergy Nuclear FitzPatrick 
shall have the sole discretion to permanently cease operations of 
FitzPatrick. For purposes of compliance with NRC requirements, by 
operation of the transfer Entergy Nuclear FitzPatrick and ENO shall 
have sole responsibility for decommissioning FitzPatrick, and the 
Authority's responsibility under Commission jurisdiction with respect 
to FitzPatrick will be limited solely to the holding and disbursement 
of funds for the decommissioning of the unit. Entergy Nuclear 
FitzPatrick and ENO will have control over all physical decommissioning 
activities. The Authority's waiver and decommissioning responsibility 
as described above only applies until the Authority transfers the 
decommissioning trust funds to Entergy Nuclear FitzPatrick or until the 
decommissioning of FitzPatrick has been completed in accordance with

[[Page 70846]]

NRC regulations and guidance, whichever shall first occur.
    In addition, the November 3, 2000, supplement to the application 
proposes that the relevant trust agreement will provide that the 
provisions or purpose of the trust agreement may be enforced by the NRC 
against the Authority and the trustee with respect to the disbursement 
of the trust funds to the extent necessary to ensure compliance with or 
satisfaction of the NRC's decommissioning requirements.
    Approval of the transfer of the facility operating license and the 
conforming license amendment was requested by PASNY, Entergy Nuclear 
FitzPatrick, and ENO, pursuant to 10 CFR 50.80 and 50.90. Notice of the 
request for approval and an opportunity to request a hearing or submit 
written comments was published in the Federal Register on June 28, 2000 
(65 FR 39954). Pursuant to such notice, the Commission received a 
hearing request dated July 14, 2000, from the Nuclear Generation 
Employees Association and William Carano, Thomas Pulcher, and Richard 
Wiese, Jr.; and a hearing request dated July 31, 2000, from the 
Citizens Awareness Network. These requests are currently pending before 
the Commission. No written comments were submitted.
    Pursuant to 10 CFR 2.1316, during the pendency of a hearing, the 
staff is expected to promptly proceed with the approval or denial of 
license transfer requests consistent with the staff's findings in its 
safety evaluation. Notice of the staff's action shall be promptly 
transmitted to the Presiding Officer and parties to the proceeding. 
Commission action on the pending hearing requests is being handled 
independently of this action.
    Under 10 CFR 50.80, no license, or any right thereunder, shall be 
transferred, directly or indirectly, through transfer of control of the 
license, unless the Nuclear Regulatory Commission shall give its 
consent in writing. After reviewing the information in the application 
and all supplements thereto (collectively, the application) and other 
information before the Commission, and relying upon the representations 
and agreements contained in the application, the NRC staff has 
determined that Entergy Nuclear FitzPatrick and ENO are qualified to be 
the holders of the license, to the extent proposed in the application, 
and that the transfer of the license to Entergy Nuclear FitzPatrick and 
ENO is otherwise consistent with applicable provisions of law, 
regulations, and orders issued by the Commission, subject to the 
conditions set forth below. The NRC staff has further found that the 
application for the proposed license amendment complies with the 
standards and requirements of the Atomic Energy Act of 1954, as 
amended, and the Commission's rules and regulations set forth in 10 CFR 
Chapter 1; the facility will operate in conformity with the 
application, the provisions of the Act and the rules and regulations of 
the Commission; there is reasonable assurance that the activities 
authorized by the proposed license amendment can be conducted without 
endangering the health and safety of the public, and that such 
activities will be conducted in compliance with the Commission's 
regulations; the issuance of the proposed license amendment will not be 
inimical to the common defense and security or to the health and safety 
of the public; and the issuance of the proposed license amendment will 
be in accordance with 10 CFR Part 51 of the Commission's regulations 
and all applicable requirements have been satisfied. The findings set 
forth above are supported by the staff's safety evaluation dated 
November 9, 2000.

III.

    Accordingly, pursuant to Sections 161b, 161i, 161o, and 184 of the 
Atomic Energy Act of 1954, as amended, 42 U.S.C. 2201(b), 2201(i), 
2201(o) and 2234, and 10 CFR 50.80, It Is Hereby Ordered that the 
transfer of the license as described herein and in the application to 
Entergy Nuclear FitzPatrick and ENO is approved, subject to the 
following conditions:
    (1) Before the completion of the sale and transfer of FitzPatrick, 
Entergy Nuclear FitzPatrick and ENO shall provide the Director, Office 
of Nuclear Reactor Regulation, satisfactory documentary evidence that 
they have obtained the appropriate amount of insurance required of 
licensees under 10 CFR Part 140 of the Commission's regulations.
    (2) For purposes of ensuring public health and safety, Entergy 
Nuclear FitzPatrick, upon the transfer of the FitzPatrick license, 
shall provide decommissioning funding assurance for FitzPatrick by the 
prepayment or equivalent method, to be held in a decommissioning trust 
fund for the facility, of no less than the amount required under NRC 
regulations at 10 CFR 50.75. Any amount held in any decommissioning 
trust maintained by the Authority for FitzPatrick after the transfer of 
the FitzPatrick license to Entergy Nuclear FitzPatrick may be credited 
towards the amount required under this paragraph.
    (3) If the assets of any decommissioning trust maintained by the 
Authority for FitzPatrick are retained in such trust following the 
transfer of the FitzPatrick license to Entergy Nuclear FitzPatrick and 
ENO instead of being transferred to any trust established by Entergy 
Nuclear FitzPatrick, the Authority shall maintain the assets as 
retained in such trust in accordance with the application for the 
transfer of the FitzPatrick license.
    (4) The decommissioning trust agreement shall provide that the use 
of assets in the decommissioning trust fund, in the first instance, 
shall be limited to the expenses related to decommissioning FitzPatrick 
as defined by the NRC in its regulations and issuances, and as provided 
in the FitzPatrick license and any amendments thereto.
    (5) The decommissioning trust agreement shall provide that no 
contribution to the decommissioning trust that consists of property 
other than liquid assets shall be permitted.
    (6) With respect to the decommissioning trust fund, investments in 
the securities or other obligations of the Authority, Entergy 
Corporation, Entergy Nuclear IP3, LLC, Entergy Nuclear FitzPatrick, 
ENO, or affiliates thereof, or their successors or assigns, shall be 
prohibited. Except for investments that replicate the composition of 
market indices or other non-nuclear-sector mutual funds, investments in 
any entity owning one or more nuclear plants is prohibited.
    (7) The decommissioning trust agreement shall provide that no 
disbursements or payments from the trust, other than for ordinary 
administrative expenses, shall be made by the trustee until the trustee 
has first given the NRC 30 days' prior written notice of the payment. 
In addition, the trust agreement shall state that no disbursements or 
payments from the trust shall be made if the trustee receives prior 
written notice of objection from the Director, Office of Nuclear 
Reactor Regulation.
    (8) The decommissioning trust agreement shall provide that the 
trust agreement shall not be modified in any material respect without 
the prior written consent of the Director, Office of Nuclear Reactor 
Regulation.
    (9) The decommissioning trust agreement shall provide that the 
provisions or purpose of the trust agreement may be enforced by the NRC 
against the Authority and the trustee with respect to the disbursement 
of the trust funds to the extent necessary to ensure compliance with or 
satisfaction of the NRC's decommissioning

[[Page 70847]]

requirements. The NRC shall not be a beneficiary of the trust or of any 
of the trust funds, unless required by law to be so for the sole 
purpose of enforcing the provisions or purpose of the trust agreement 
as set forth above.
    (10) Article VI of the decommissioning trust agreement shall 
require that, notwithstanding the provision of Section 6.01(ii)(a) of 
the current decommissioning trust agreement, PASNY may not terminate 
any fund established under the Master Trust for FitzPatrick except 
after requesting and obtaining written consent from the Director, 
Office of Nuclear Reactor Regulation, or the Director, Office of 
Nuclear Materials Safety and Safeguards, as appropriate.
    (11) Entergy Nuclear FitzPatrick, ENO, or their successors or 
assigns shall take no action that would adversely affect any contract 
between it and the Authority for the Authority's eventual payment of 
decommissioning funds from the trust.
    (12) Entergy Nuclear FitzPatrick and ENO, or their successors or 
assigns shall inform the NRC within 30 days of any adverse developments 
with respect to the Authority's ownership of the decommissioning trust 
that could reasonably be expected to lead to a significant diminution 
of funds available for decommissioning FitzPatrick.
    (13) The appropriate section of the decommissioning trust agreement 
shall provide that the trustee, investment advisor, or anyone else 
directing the investments made in the trust shall adhere to a ``prudent 
investor'' standard, as specified in 18 CFR 35.32(a)(3) of the Federal 
Energy Regulatory Commission's regulations.
    (14) The Authority shall waive any right to deny, contest or 
challenge the NRC's jurisdiction over the Authority with respect to 
FitzPatrick to the extent that there may arise in the future any matter 
warranting action by the NRC to ensure compliance with the NRC's 
decommissioning requirements regarding the disposition and use of the 
amounts accumulated in the decommissioning trust fund and retained by 
the Authority, and remain subject to the Commission's jurisdiction 
under Section 161 of the Atomic Energy Act to issue orders to protect 
health and to minimize danger to life or property regarding any and all 
matters concerning compliance with the Commission's decommissioning 
requirements regarding the disposition and use of the amounts 
accumulated in the decommissioning trust fund and retained by the 
Authority, until such time as the Authority transfers the 
decommissioning trust fund to Entergy Nuclear FitzPatrick or the 
decommissioning of FitzPatrick has been completed in accordance with 
NRC regulations and guidance, whichever occurs first.
    (15) Entergy Nuclear FitzPatrick shall take all necessary steps to 
ensure that the decommissioning trust is maintained in accordance with 
the application for the transfer of the license for FitzPatrick and the 
requirements of this Order approving the transfer, and consistent with 
the safety evaluation supporting this Order.
    (16) Entergy Nuclear FitzPatrick and ENO shall take no action to 
cause Entergy Global Investments, Inc. or Entergy International Ltd. 
LLC, or their parent companies, to void, cancel, or modify the $70 
million contingency commitment to provide funding for the FitzPatrick 
plant as represented in the application, without the prior written 
consent of the Director, Office of Nuclear Reactor Regulation.
    (17) After receiving all required regulatory approvals of the 
transfer of FitzPatrick, the transfer applicants shall immediately 
inform the Director, Office of Nuclear Reactor Regulation, in writing 
of such receipt, and state therein the closing date of the sale and 
transfer of FitzPatrick. If the transfer of the license is not 
completed by November 1, 2001, this Order shall become null and void, 
provided, however, on written application and for good cause shown, 
this date may be extended.
    It is Further Ordered that, consistent with 10 CFR 2.1315(b), a 
license amendment that makes changes, as indicated in Enclosure 2 to 
the cover letter forwarding this Order, to conform the license to 
reflect the subject license transfer is approved. The amendment shall 
be issued and made effective at the time the proposed license transfer 
is completed.
    This Order is effective upon issuance.
    For further details with respect to this Order, see the initial 
application submitted under cover letters dated May 11 and May 12, 
2000, and supplements dated June 13, June 16, July 14, September 21, 
October 26, and November 3, 2000, and the safety evaluation dated 
November 9, 2000, which are available for public inspection at the 
NRC's Public Document Room, located at One White Flint North, 11555 
Rockville Pike (first floor), Rockville, Maryland and are accessible 
electronically through the ADAMS Public Electronic Reading Room link at 
the NRC Web site (http://www.nrc.gov).

    Dated at Rockville, Maryland, this 9th day of November 2000.

    For the Nuclear Regulatory Commission.
Samuel J. Collins,
Director, Office of Nuclear Reactor Regulation.
[FR Doc. 00-30284 Filed 11-27-00; 8:45 am]
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