[Federal Register Volume 70, Number 250 (Friday, December 30, 2005)]
[Pages 77431-77432]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: E5-8204]



[Docket No. 50-331; License No. NPF-49]

In the Matter of Interstate Power and Light Company; Nuclear 
Management Company, LLC; (Duane Arnold Energy Center); Order Approving 
Transfer of License and Conforming Amendment

    I. Interstate Power and Light Company (IPL), Nuclear Management 
Company, LLC (NMC) Central Iowa Power Cooperative, and Corn Belt Power 
Cooperative are holders of Facility Operating License No. DPR-49, which 
authorizes the possession, use and operation of Duane Arnold Energy 
Center (DAEC). NMC is licensed by the U.S. Nuclear Regulatory 
Commission (NRC, the Commission) to operate DAEC. The other licensees 
are authorized to possess DAEC. DAEC is located at Linn County, Iowa.
    II. By letter dated August 1, 2005, NMC, IPL and FPL Energy Duane 
Arnold, LLC, (FPLE Duane Arnold), submitted an application requesting 
approval of the direct license transfer that would be necessary in 
connection with the IPL's proposed transfer to FPLE Duane Arnold, a 
subsidiary of FPL Energy, LLC (FPLE), IPL's 70-percent ownership 
interest in DAEC. The application also requested approval of the 
transfer of NMC's operating authority to FPLE Duane Arnold.
    Supplemental information was provided by letters dated October 11, 
November 1, November 2, and November 28, (hereinafter, the August 1, 
2005, and supplemental information will be referred to collectively as 
the application, unless otherwise noted). NMC also requested approval 
of a conforming license amendment that would reflect the proposed 
transfer of ownership of IPL's 70-percent interest in DAEC to FPLE 
Duane Arnold; and reflect the proposed transfer of operating authority 
to FPLE Duane Arnold. The amendment would delete the references to IPL 
and NMC in the license as appropriate, and replace them with references 
to FPLE Duane Arnold. No physical changes to the facility or 
operational changes were proposed in the application. After completion 
of the proposed transfers, FPLE Duane Arnold would be an owner (70-
percent interest) and the operator of DAEC. The 30-percent ownership 
interest in DAEC, collectively held by Central Iowa Power Cooperative 
(CIPCO) and the Corn Belt Power Cooperative (Corn Belt), would be 
    Approval of the transfer of the facility operating license and 
conforming license amendment is requested by NMC pursuant to Sections 
50.80 and 50.90 of Title 10 of the Code of Federal Regulations (10 
CFR). Notices of the request for approval and opportunity for a hearing 
were published in the Federal Register on September 20, 2005, (70 FR 
55175). No comments were received. No requests for hearing or petitions 
for leave to intervene were received.
    Pursuant to 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 Commission shall give its consent in 
writing. Upon review of the information in 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 FPLE Duane Arnold is qualified to hold the license for 
DAEC to the extent previously held by IPL regarding its ownership 
interest, and is qualified to hold the operating authority under the 
license, and that the transfer of the license as proposed in the 
application 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 also found that the 
application for the proposed license amendment complies with the 
standards and requirements of the Atomic Energy Act of 1954, as amended 
(the Act), and the Commission's rules and regulations set forth in 10 
CFR Chapter I; 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 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 an NRC safety 
evaluation dated December 23, 2005.
    III. Accordingly, pursuant to Sections 161b, 161i, 161o and 184 of 
the Act, 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, to FPLE Duane

[[Page 77432]]

Arnold is approved, subject to the following conditions:

    (1) Prior to completion of the transfer of the license, FPLE 
Duane Arnold shall provide the Director of the Office of Nuclear 
Reactor Regulation satisfactory documentary evidence that it has 
obtained the appropriate amount of insurance required of licensees 
under 10 CFR Part 140 of the Commission's regulations.
    (2) At the time of the closing of the transfer of the license 
from Interstate Power and Light Company (IPL) to FPLE Duane Arnold, 
IPL shall transfer to FPLE Duane Arnold IPL's decommissioning funds 
accumulated as of such time, with an aggregate minimum value of at 
least $186 million, and FPLE Duane Arnold shall deposit such funds 
in an external decommissioning trust fund established by FPLE Duane 
Arnold for DAEC. FPLE Duane Arnold shall take all necessary steps to 
ensure that this external trust fund is maintained in accordance 
with the requirements of this order approving the license transfer, 
NRC regulations, and consistent with the safety evaluation 
supporting this order. The trust agreement shall be in a form 
acceptable to the NRC.
    (3) By the date of closing of the transfer of the 70 percent 
ownership interest in DAEC from IPL to FPLE Duane Arnold, FPLE Duane 
Arnold shall obtain a parent company guarantee from FPL Group 
Capital in an initial amount of at least $75 million (in 2005 
dollars) to provide additional decommissioning funding assurance 
regarding such ownership interest, which guarantee must be in 
accordance with NRC regulations regarding such documents. Required 
funding levels shall be recalculated annually and, as necessary, 
FPLE Duane Arnold shall either obtain appropriate adjustments to the 
parent guarantee or otherwise provide any additional decommissioning 
funding assurance necessary for FPLE Duane Arnold to meet NRC 
requirements under 10 CFR 50.75.
    (4) FPLE Duane Arnold shall take no action to cause FPL Group 
Capital, or its successors and assigns, to void, cancel, or modify 
its $50 million contingency commitment to FPLE Duane Arnold, as 
represented in the application, or cause it to fail to perform or 
impair its performance under the commitment, without the prior 
written consent from the NRC. An executed copy of the Support 
Agreement shall be submitted to the NRC no later than 30 days after 
completion of the license transfer. Also, FPLE Duane Arnold shall 
inform the NRC in writing any time that it draws upon the $50 
million commitment.

    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.
    It is further ordered that FPLE Duane Arnold shall inform the 
Director of the Office of Nuclear Reactor Regulation in writing of the 
date of closing of the transfer of the IPL 70-percent interest in DAEC 
no later than 5 business days prior to closing. Should the transfer of 
the license not be completed by December 31, 2006, this Order shall 
become null and void, provided however, that upon written application 
and for good cause shown, such date may be extended by order.
    This Order is effective upon issuance.
    For further details with respect to this Order, see the initial 
application dated August 1, 2005, and supplemental letters dated 
October 11, November 1, November 2, and November 28, 2005, and the non-
proprietary safety evaluation dated December 15, 2005, which is 
available for public inspection at the Commission's Public Document 
Room (PDR), located at One White Flint North, Public File Area 01 F21, 
11555 Rockville Pike (first floor), Rockville, Maryland and accessible 
electronically from the Agencywide Documents Access and Management 
System (ADAMS) Public Electronic Reading Room on the Internet at the 
NRC Web site, http://www.nrc.gov/reading-rm/adams.html. Persons who do 
not have access to ADAMS or who encounter problems in accessing the 
documents located in ADAMS, should contact the NRC PDR Reference staff 
by telephone at 1-800-397-4209, 301-415-4737, or by e-mail to 
[email protected].

    Dated at Rockville, Maryland, this 23rd day of December 2005.

For the Nuclear Regulatory Commission.
R. William Borchardt,
Acting Director, Office of Nuclear Reactor Regulation.
 [FR Doc. E5-8204 Filed 12-29-05; 8:45 am]