In the Matter of EDF Development, Inc.; Constellation Energy Nuclear Group, LLC; R.E. Ginna Nuclear Power Plant, LLC (R.E. Ginna Nuclear Power Plant); Order Superseding Order of October 9, 2009, Approving Application Regarding Proposed Corporate Restructuring, 57529-57531 [E9-26805]

Agencies

• NUCLEAR REGULATORY COMMISSION

[Federal Register Volume 74, Number 214 (Friday, November 6, 2009)]
[Notices]
[Pages 57529-57531]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: E9-26805]


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NUCLEAR REGULATORY COMMISSION

[NRC-2009-0192; Docket No. 50-244; Renewed License No. DPR-18]


In the Matter of EDF Development, Inc.; Constellation Energy 
Nuclear Group, LLC; R.E. Ginna Nuclear Power Plant, LLC (R.E. Ginna 
Nuclear Power Plant); Order Superseding Order of October 9, 2009, 
Approving Application Regarding Proposed Corporate Restructuring

I

    R.E. Ginna Nuclear Power Plant, LLC (Ginna, LLC or the licensee) is 
the holder of Renewed Facility Operating License No. DPR-18 which 
authorizes the possession, use, and operation of the R.E. Ginna Nuclear 
Power Plant (Ginna). The facility is located at the licensee's site in 
Ontario, New York. The operating license authorizes the licensee to 
possess, use, and operate Ginna.

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) 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 Ginna. 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.
    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 Ginna, LLC and Nine 
Mile Point Nuclear Station, 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 Ginna, LLC, Nine Mile Point Nuclear Station, LLC, and 
Calvert Cliffs Nuclear Power Plant, LLC by merger. No physical changes 
to the facilities or operational changes are being proposed in the 
application.
    Approval of the transfer of the license is requested by the 
applicants pursuant to 10 CFR 50.80. Notice of the request for approval 
and opportunity for a hearing was published in the Federal Register on 
May 6, 2009 (74 FR 21013). No hearing requests or petitions to

[[Page 57530]]

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, 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 license 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, to the extent affected by the proposed 
transaction as described in the application, is 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 
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 
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 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, it is hereby ordered that the Application regarding the indirect 
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) 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 Ginna, 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 Ginna, 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) 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

[[Page 57531]]

pursuant to the Securities and Exchange Act of 1934 that disclose 
beneficial ownership of any registered classes of CEG stock.
    (2) 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 Ginna, 
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 Ginna, 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 Ginna, 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 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 transfer of the license 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), October 26 (ML093000506), and October 28, 2009 
(ML092150712), 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, https://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 pdr.resource@nrc.gov.

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

    For the Nuclear Regulatory Commission.
Eric J. Leeds,
Director, Office of Nuclear Reactor Regulation.
[FR Doc. E9-26805 Filed 11-5-09; 8:45 am]
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