[Federal Register Volume 74, Number 214 (Friday, November 6, 2009)]
[Notices]
[Pages 57533-57536]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: E9-26813]


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NUCLEAR REGULATORY COMMISSION

[NRC-2009-0194; Docket Nos. 50-317, 50-318, 72-8; Renewed License No. 
DPR-53; Renewed License No. DPR-69; License No. SNM-2505]


In the Matter of: Constellation Energy Nuclear Group, LLC; EDF 
Development, Inc.; Calvert Cliffs Nuclear Power Plant, Inc.; Calvert 
Cliffs Nuclear Power Plant, LLC (Calvert Cliffs Nuclear Power Plant, 
Unit Nos. 1 and 2, and Calvert Cliffs Independent Spent Fuel Storage 
Installation); Order Superseding Order of October 9, 2009, Approving 
Application Regarding Proposed Corporate Restructuring and Approving 
Conforming Amendments

I

    Calvert Cliffs Nuclear Power Plant, Inc. (CCNPP, Inc. or the 
licensee) is the holder of Renewed Facility Operating License Nos. DPR-
53 and DPR-69, which authorize the possession, use, and operation of 
Calvert Cliffs Nuclear Power Plant, Unit Nos. 1 and 2 (CCNPP 1 and 2), 
and of Materials License No. SNM-2505, which authorizes the possession, 
use, and operation of the Calvert Cliffs Independent Spent Fuel Storage 
Installation (Calvert Cliffs ISFSI), and authorizes CCNPP, Inc. to 
receive, possess, transfer, and store power reactor spent fuel at the 
Calvert Cliffs ISFSI. The facilities are located at the licensee's site 
in Calvert County, Maryland.

II

    By letter dated January 22, 2009, as supplemented on February 26, 
April 8, June 25, July 27, October 15, October 19, October 25 (two 
letters), October 26, and October 28, 2009 (together, the Application), 
Constellation Energy Nuclear Group, LLC (CENG), on behalf of the 
licensee and EDF Development, Inc. (EDF Development) (together, the 
applicants), requested that the Nuclear Regulatory Commission (NRC, the 
Commission), pursuant to Title 10 of the Code of Federal Regulations 
(10 CFR)

[[Page 57534]]

50.80, consent to the indirect license transfers that would be effected 
by the indirect transfer of control of CENG's ownership and operating 
interests in CCNPP, Inc. The actions being sought are a result of 
certain proposed corporate restructuring actions in connection with a 
planned investment by EDF Development whereby it would acquire a 49.99% 
ownership interest in CENG from Constellation Energy Group, Inc. (CEG), 
the current 100% owner of CENG. EDF Development is a U.S. corporation 
organized under the laws of the State of Delaware and a wholly-owned 
subsidiary of E.D.F. International S.A., a public limited company 
organized under the laws of France, which is in turn a wholly-owned 
subsidiary of [Eacute]lectricit[eacute] de France S.A., a French 
limited company. The applicants also requested approval of the proposed 
direct transfer of licenses held under CCNPP, Inc. to a new legal 
entity, Calvert Cliffs Nuclear Power Plant, LLC (CCNPP, LLC) and 
approval of conforming license amendments that would replace references 
to CCNPP, Inc. in the license with references to CCNPP, LLC to reflect 
the transfer of ownership and operating authority, specifically, to 
possess, use, and operate CCNPP 1 and 2 and to receive, possess, or use 
related licensed materials under the applicable conditions and 
authorizations in the CCNPP 1 and 2 licenses and for the ISFSI license.
    Following the closing of the transfer of ownership interests in 
CENG to EDF Development, EDF Development will hold a 49.99% ownership 
interest in CENG; CEG will hold a 50.01% ownership interest in CENG 
through two new intermediate parent companies, Constellation Nuclear, 
LLC and CE Nuclear, LLC, formed for non-operational purposes. In 
addition, Constellation Nuclear Power Plants, Inc., which is currently 
an intermediate holding company between CENG and Nine Mile Point 
Nuclear Station, LLC and R.E. Ginna Nuclear Power Plant, LLC, will 
convert to a Delaware limited liability company by operation of law and 
become Constellation Nuclear Power Plants, LLC, and will exist as an 
intermediate holding company between CENG and CCNPP, LLC, Nine Mile 
Point Nuclear Station, LLC, and R.E. Ginna Nuclear Power Plant, LLC. 
CCNPP, Inc. will convert to CCNPP, LLC by merger.
    No physical changes to the facilities or operational changes are 
being proposed in the application. The proposed conforming license 
amendment would replace references to CCNPP, Inc. in the license with 
references to CCNPP, LLC to reflect the proposed direct transfer of the 
licenses.
    Approval of the transfer of the license and the conforming license 
amendment is requested by the applicants pursuant to 10 CFR 50.80, 10 
CFR 50.90, and 10 CFR 72.50. Notice of the request for approval and 
opportunity for a hearing was published in the Federal Register on May 
7, 2009 (74 FR 21413). No hearing requests or petitions to intervene 
were received. The NRC received comments from a member of the public in 
Seattle, Washington, in an e-mail dated May 22, 2009. The comments did 
not provide any information additional to that in the application, nor 
did they provide any information contradictory to that provided in the 
application.
    Pursuant to 10 CFR 50.80 and 10 CFR 72.50, 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 the proposed indirect license 
transfer of control of the subject licenses held by the licensee to the 
extent such will result from the proposed corporate restructuring 
actions and the planned investment by EDF Development whereby it will 
acquire a 49.99% ownership interest in CENG, and that the direct 
transfer of CCNPP, Inc. to CCNPP, LLC as described in the Application, 
are otherwise consistent with applicable provisions of law, 
regulations, and Orders issued by the NRC, pursuant thereto, 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 
(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 amendments 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 amendments will 
be in accordance with 10 CFR Part 51 of the Commission's regulations 
and all applicable requirements have been satisfied.
    On October 9, 2009, the Commission issued, ``Order Approving 
Application Regarding Proposed Corporate Restructuring and Approving 
Conforming Amendments.''
    By letter dated October 19, 2009, CENG explained that its January 
22, 2009, application for the license transfers had anticipated nearly 
concurrent completion of the proposed internal corporate restructuring 
of the CEG subsidiaries and the proposed EDF acquisition of 44.99% of 
CENG. After it filed its January 22, 2009, application, CENG learned 
that the restructuring activities for the CEG subsidiaries will be 
completed at least 8 days prior to closing the transaction involving 
EDF. In letters dated October 25 (two letters), 26, and 28, 2009, CENG 
provided revised financial arrangements that will apply during the 
period between the completion of the internal restructuring activities 
and the acquisition of 44.99% of CENG by EDF and a revised operating 
agreement that will apply after the EDF closing.
    The NRC concluded that modifications were needed to the cover 
letter, the October 9, 2009, Order, and the safety evaluations in light 
of the new information provided in CENG's letters of October 19 through 
28, 2009. This Order contains those modifications and supersedes the 
Order issued October 9, 2009.
    The findings set forth above are supported by a modified NRC safety 
evaluation (SE) dated the same day as this Order.

III

    Accordingly, pursuant to Sections 161b, 161i, 161o, and 184 of the 
Act, 42 U.S.C. Sections 2201(b), 2201(i), 2201(o), and 2234; and 10 CFR 
50.80 and 10 CFR 72.50, it is hereby ordered that the Application 
regarding the indirect license transfers and direct license transfers 
related to the proposed corporate restructuring actions and the planned 
investment by EDF Development, as described herein, is approved, 
subject to the following conditions:
    A. With regard to the direct and indirect transfers resulting from 
the restructuring of the CEG subsidiaries:
    (1) Before completion of the direct transfer of the CNPP license, 
CENG shall provide the Director of the Office of Nuclear Reactor 
Regulation satisfactory documentary evidence that CCNPP, LLC has 
obtained the appropriate amount of

[[Page 57535]]

insurance required of licensees under 10 CFR part 140 of the 
Commission's regulations.
    (2) CCNPP, LLC may no longer rely exclusively on an external 
sinking fund as its decommissioning funding assurance mechanism and 
will be required to implement an alternate decommissioning funding 
assurance mechanism, acceptable per NRC requirements outlined in 10 CFR 
50.75(e)(1), which will be used to provide decommissioning funding 
assurance.
    (3) The financial arrangements resulting from the corporate 
restructuring activities of the CEG subsidiaries are subject to the 
following:
    (a) The Inter-Company Credit Agreements (ICA) described in the 
October 25, 2009, supplement to the Application shall be effective as 
of the date of the direct and indirect transfers (whichever occurs 
first) resulting from the restructuring of CEG subsidiaries and shall 
be consistent with the representations contained in the Application. 
CENG and CCNPP, LLC shall take no action to cause CEG, or their 
successors and assigns, to void, cancel or materially modify the ICA as 
submitted without the prior written consent of the NRC staff. CENG 
shall inform the Director of the Office of Nuclear Reactor Regulation, 
in writing, no later than 10 days after any funds are provided to CENG 
or any of the licensees by CEG or EDF Development under any Support 
Agreement.
    (b) The Master Demand Notes described in the October 26, 2009, 
supplement to the Application shall be effective as of the date of the 
direct and indirect transfers (whichever occurs first) resulting from 
the restructuring of CEG subsidiaries and shall be consistent with the 
representations contained in the Application. CENG and CCNPP, LLC, 
shall take no action to cause CEG, or their successors and assigns, to 
void, cancel or materially modify the Master Demand Notes without the 
prior written consent of the NRC staff.
    B. With regard to the indirect transfers resulting from the 
acquisition of 44.99% of CENG by EDF Development (EDF Closing):
    (1) Before completion of the EDF Closing, Conditions A.(1) and 
A.(2) above must be fulfilled.
    (2) The ownership and governance arrangements in effect as of the 
date of the indirect transfers to EDF Development are subject to the 
following:
    (a) The Operating Agreement included with the supplement dated 
October 25, 2009, may not be modified in any material respect 
concerning decisionmaking authority over ``safety issues'' as defined 
therein without the prior written consent of the Director, Office of 
Nuclear Reactor Regulation.
    (b) At least half the members of CENG's Board of Directors must be 
U.S. citizens.
    (c) The Chief Executive Officer (CEO), Chief Nuclear Officer (CNO) 
and Chairman of the Board of Directors of CENG must be U.S. citizens. 
These individuals shall have the responsibility and exclusive authority 
to ensure and shall ensure that the business and activities of CENG 
with respect to the Calvert Cliffs, Unit Nos. 1 and 2, Calvert Cliffs 
ISFSI, Nine Mile Point, Unit Nos. 1 and 2, and R.E. Ginna licenses are 
at all times conducted in a manner consistent with the public health 
and safety and common defense and security of the United States.
    (d) CENG will establish a Nuclear Advisory Committee (NAC) composed 
of U.S. citizens who are not officers, directors, or employees of CENG, 
CEG or EDF Development. The NAC will report to and provide transparency 
to the NRC and other U.S. governmental agencies regarding foreign 
ownership and control of nuclear operations.
    (e) CENG shall cause to be transmitted to the Director, Office of 
Nuclear Reactor Regulation, within 30 days of knowledge of a filing 
with the U.S. Securities and Exchange Commission, any Schedules 13D or 
13G filed pursuant to the Securities and Exchange Act of 1934 that 
disclose beneficial ownership of any registered classes of CEG stock.
    (3) The financial arrangements applicable to the indirect transfers 
resulting from the EDF Closing are subject to the following:
    (a) The working capital and cash pooling arrangements described in 
Article IV of the Operating Agreement included with the October 25, 
2009 supplement to the Application, shall be effective as of the date 
of the indirect transfers to EDF Development and shall be consistent 
with the representations contained in the Application. CENG and CCNPP, 
LLC shall take no action to cause CEG and/or EDF Development, or their 
successors and assigns, to void, cancel or materially modify the 
working capital and cash pooling arrangements in the Operating 
Agreement without the prior written consent of the NRC staff.
    (b) The Support Agreements described in the February 26, 2009 
supplement to the Application shall be effective as of the date of the 
indirect transfers to EDF Development; shall supersede the Inter-
Company Credit Agreements provided by CEG, Inc.; and shall be 
consistent with the representations contained in the Application. CENG 
and CCNPP, LLC shall take no action to cause CEG and/or EDF 
Development, or their successors and assigns, to void, cancel or 
materially modify the Support Agreements as submitted without the prior 
written consent of the NRC staff. CENG shall inform the Director of the 
Office of Nuclear Reactor Regulation, in writing, no later than 10 days 
after any funds are provided to CENG or any of the licensees by CEG or 
EDF Development under any Support Agreement.
    (c) The Master Demand Notes described in the October 28, 2009 
supplement to the Application, shall be effective as of the date of the 
indirect transfers to EDF Development; shall supersede the Master 
Demand Notes provided by CEG, Inc.; and shall be consistent with the 
representations contained in the Application. CENG and CCNPP, LLC, 
shall take no action to cause CEG and/or EDF Development, or their 
successors and assigns, to void, cancel or materially modify the Master 
Demand Notes without the prior written consent of the NRC staff.
    It is further ordered that, consistent with 10 CFR 2.1315(b), the 
license amendment that makes changes to conform the license to reflect 
the subject direct license transfer is approved. The amendment shall be 
issued and made effective at the time the proposed direct license 
transfer is completed.
    It is further ordered that CENG shall inform the Director of the 
Office of Nuclear Reactor Regulation, in writing, of the date of 
closing of the transfer of EDF Development's ownership and operating 
interests in CENG at least 1 business day before the closing. Should 
the transfers of the licenses not be completed within 1 year of this 
Order's date of issuance, 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 supersedes the Order issued on October 9, 2009, and is 
effective upon issuance.
    For further details with respect to this Order, see the initial 
application dated January 22, 2009 (Agencywide Documents Access and 
Management System (ADAMS) Accession No. ML090290101), as supplemented 
by letters dated February 26 (ML090630426), April 8 (ML091000665), June 
25 (ML091811094), and July 27, 2009 (ML092150712), October 15 
(ML092920168), October 19 (ML092990101), October 25 (ML093000127 and 
ML093000141),

[[Page 57536]]

October 26 (ML093000506), and October 28, and the SE (ML093010003) with 
the same date as this Order, which are available for public inspection 
at the Commission's Public Document Room (PDR), located at One White 
Flint North, 11555 Rockville Pike, Room O-1 F21 (First Floor), 
Rockville, Maryland, and accessible electronically from the 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 or 301-415-4737, or by e-mail at 
[email protected].

    Dated at Rockville, Maryland, this 30th day of October 2009.

    For the Nuclear Regulatory Commission.
Eric J. Leeds,
Director, Office of Nuclear Reactor Regulation.
Michael F. Weber,
Director, Office of Nuclear Material Safety and Safeguards.
[FR Doc. E9-26813 Filed 11-5-09; 8:45 am]
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