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Notice

In the Matter of Consolidated Edison Company of New York, Inc. (Indian Point Nuclear Generating Unit Nos. 1 and 2); Order Approving Transfer of Licenses and Conforming Amendments

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Information about this document as published in the Federal Register.

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Start Preamble

I.

The Consolidated Edison Company of New York, Inc., (Con Edison) is the holder of Facility Operating License No. DPR-5, for the Indian Point Nuclear Generating Unit No. 1 (IP1), and Facility Operating License No. DPR-26, for the Indian Point Nuclear Generating Unit No. 2 (IP2). The licenses authorize Con Edison to possess and maintain IP1 and to possess, use, and operate IP2 at steady-state power levels not in excess of 3071.4 megawatts thermal. The IP1 and 2 facilities, which are owned by Con Edison, are located in Westchester County, New York.

II.

Under cover of a letter dated December 12, 2000, Con Edison, Entergy Nuclear Indian Point 2, LLC (Entergy Nuclear IP2) and Entergy Nuclear Start Printed Page 46035Operations, Inc., (ENO) submitted an application requesting approval of a transfer of the above licenses to Entergy Nuclear IP2, the proposed owner of IP1 and IP2, and to ENO, the proposed entity to maintain IP1 and operate IP2, and approval of conforming amendments to the licenses to reflect the transfer. The application was supplemented by letters dated April 12, 2001, from Con Edison and April 16, May 24, June 6, and June 8, 2001, from Entergy Nuclear IP2 and ENO. The application and supplements are collectively referred to herein as the application, unless otherwise noted.

According to the application, Entergy Nuclear IP2 would assume title to both facilities following approval of the proposed license transfers, and ENO would become responsible for the maintenance of IP1 and operation and maintenance of IP2.

Entergy Nuclear IP2, a Delaware limited liability company, is an indirect wholly owned subsidiary of Entergy Corporation, and an indirect wholly owned subsidiary of Entergy Nuclear Holding Company #3. 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.

The conforming amendments would remove the current licensee from the facility operating licenses and would add Entergy Nuclear IP2 and ENO in its place, as appropriate. In addition, other administrative changes to the licenses would be made to reflect the filing of the application and subject license transfers.

Approval of the transfer of the facility operating licenses and the conforming license amendments was requested pursuant to 10 CFR 50.80 and 50.90. Notice of the request for approval and an opportunity to request a hearing or to submit written comments was published in the Federal Register on January 29, 2001 (66 FR 8122). Pursuant to the notice, the Commission received hearing requests dated February 20, 2001, from the Citizens Awareness Network, Inc., and jointly from the Town of Cortlandt Manor, New York, and the Hendrick Hudson School District. These requests are currently pending before the Commission. No written comments as alternatives to hearing requests were submitted.

Pursuant to 10 CFR 2.1316, during the pendency of a hearing, the U.S. Nuclear Regulatory Commission (NRC) 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 NRC shall give its consent in writing. After reviewing 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 Entergy Nuclear IP2 and ENO are qualified to be the holders of the licenses to the extent proposed in the application, and that the transfer of the licenses to Entergy Nuclear IP2 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 amendments 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 facilities 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 amendments 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 license amendments 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 August 27, 2001.

III.

Accordingly, pursuant to Sections 161b, 161i, 161o, and 184 of the Atomic Energy Act of 1954, as amended, 42 USC §§ 2201(b), 2201(i), 2201(o), and 2234, and 10 CFR 50.80, It Is Hereby Ordered, That the transfer of the licenses, as described herein and in the application, to Entergy Nuclear IP2 and ENO is approved, subject to the following conditions:

1. Before the completion of the transfer of the IP1 and IP2 licenses, Entergy Nuclear IP2 and ENO shall provide the Director of the 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. On the closing date of the transfer of the licenses, Con Edison shall transfer to Entergy Nuclear IP2 all of the accumulated decommissioning trust funds for IP1 and IP2 and such additional funds to be deposited in the decommissioning trusts for IP1 and IP2 such that the total amount transferred is no less than $430,000,000. Furthermore, Entergy Nuclear IP2 shall either (a) establish a provisional trust for decommissioning funding assurance for IP1 and IP2 in an amount no less than $25,000,000 (to be updated as required under applicable NRC regulations, unless otherwise approved by the NRC) or (b) obtain a surety bond for an amount no less than $25,000,000 (to be updated as required under applicable NRC regulations, unless otherwise approved by the NRC). The total decommissioning funding assurance provided for IP1 and IP2 by the combination of the decommissioning trusts and the provisional trust or surety bond at the time of transfer of the licenses shall be at a level no less than the amounts calculated pursuant to, and required under, 10 CFR 50.75. The decommissioning trusts, provisional trust, and surety bond shall be subject to or be consistent with the following requirements, as applicable:

(a) Decommissioning Trusts

(i) The decommissioning trust agreement must be in a form acceptable to the NRC.

(ii) With respect to the decommissioning trust funds, investments in the securities or other obligations of Entergy Corporation, or its affiliates, subsidiaries, successors, or assigns are and shall be prohibited. Except for investments tied to market indexes or other non-nuclear-sector mutual funds, investments in any entity owning one or more nuclear power plants are and shall be prohibited.

(iii) No contribution to the funds that consists of property other than liquid assets shall be permitted.

(iv) The decommissioning trust agreement must provide that no disbursements or payments from the trusts, other than for ordinary administrative expenses, shall be made by the trustee unless the trustee has first given the Director of the Office of Nuclear Reactor Regulation 30 days Start Printed Page 46036prior written notice of payment. The decommissioning trust agreement shall further contain a provision that no disbursements or payments from the trusts shall be made if the trustee receives prior written notice of objection from the NRC.

(v) The decommissioning trust agreement must provide that the agreement cannot be amended in any material respect without 30 days prior written notification to the Director of the Office of Nuclear Reactor Regulation.

(vi) The appropriate section of the decommissioning trust agreement shall state that the trustee, investment advisor, or anyone else directing the investments made in the trusts shall adhere to a “prudent investor” standard, as specified in 18 CFR 35.32(a)(3) of the Federal Energy Regulatory Commission's regulations.

(b) Provisional Trust

(i) The provisional trust agreement must be in a form acceptable to the NRC.

(ii) Investments in the securities or other obligations of Entergy Corporation or its affiliates, subsidiaries, successors, or assigns are and shall be prohibited. Except for investments tied to market indexes or other non-nuclear-sector mutual funds, investments in any entity owning one or more nuclear power plants are and shall be prohibited.

(iii) The provisional trust agreement must provide that no disbursements or payments from the trust, other than for ordinary administrative expenses, shall be made by the trustee unless the trustee has first given the Director of the Office of Nuclear Reactor Regulation 30 days prior written notice of payment. The provisional trust agreement shall further contain a provision that no disbursements or payments from the trust shall be made if the trustee receives prior written notice of objection from the NRC.

(iv) The provisional trust agreement must provide that the agreement cannot be amended in any material respect, or terminated, without 30 days prior written notification to the Director of the Office of Nuclear Reactor Regulation.

(v) The appropriate section of the provisional trust agreement shall state 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.

(vi) Use of assets in the provisional trust, in the first instance, shall be limited to the expenses related to decommissioning IP1 and IP2 as defined by the NRC in its regulations and issuances, and as provided in the IP1 and IP2 licenses and any amendments thereto.

(c) Surety Bond

(i) The surety bond agreement must be in a form acceptable to the NRC and be in accordance with all applicable NRC regulations.

(ii) The surety company providing any surety bond obtained to comply with this Order shall be one of those listed by the U.S. Department of the Treasury in the most recent edition of Circular 570 and shall have a coverage limit sufficient to cover the amount of the surety bond.

(iii) Entergy Nuclear IP2 shall establish a standby trust to receive funds from the surety bond, if a surety bond is obtained, in the event that Entergy Nuclear IP2 defaults on its funding obligations for the decommissioning of IP1 or IP2. The standby trust agreement must be in a form acceptable to the NRC, and shall conform with all conditions otherwise applicable to the decommissioning trust agreement, and with all conditions that would be applicable to the provisional trust above, if established.

(iv) The surety agreement must provide that the agreement cannot be amended in any material respect, or terminated, without 30 days prior written notification to the Director of the Office of Nuclear Reactor Regulation.

3. Entergy Nuclear IP2 shall take all necessary steps to ensure that the decommissioning trusts are maintained in accordance with the application and the requirements of this Order, and consistent with the safety evaluation supporting this Order.

4. Entergy Nuclear IP2 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 $55 million contingency commitment to provide funding for the IP1 and IP2 plants as represented in the application without the prior written consent of the Director of the Office of Nuclear Reactor Regulation.

5. After receipt of all required approvals of the transfer of IP1 and IP2, Con Edison shall inform the Director of the Office of Nuclear Reactor Regulation, in writing, of such receipt within 5 business days, and of the date of the closing of the transfer no later than 7 business days prior to the date of the closing. Should the transfer of the licenses not be completed by August 27, 2002, 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.

It Is Further Ordered that, consistent with 10 CFR 2.1315(b), license amendments that make changes, as indicated in Enclosure 2 to the cover letter forwarding this Order, to conform the licenses to reflect the subject license transfers are approved. The amendments shall be issued and made effective at the time the proposed license transfers are completed.

This Order is effective upon issuance.

For further details with respect to this Order, see the initial application submitted under cover letter dated December 12, 2000, and supplements dated April 12, 2001, submitted by Con Edison, and dated April 16, 2001, May 24, June 6, and June 8, 2001, submitted by Entergy Nuclear IP2 and ENO, and the safety evaluation dated August 27, 2001, 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).

Start Signature

Dated at Rockville, Maryland, this 27th day of August 2001.

For the Nuclear Regulatory Commission.

Samuel J. Collins,

Director, Office of Nuclear Reactor Regulation.

End Signature End Preamble

[FR Doc. 01-22026 Filed 8-30-01; 8:45 am]

BILLING CODE 7590-01-P