The two partners in Unistar Nuclear Energy have agreed a set of deals that will see Electricité de France (EdF) develop Calvert Cliffs 3 alone.
|Calvert Cliffs 1 and 2 remain under
Constellation's control, while EdF has
to develop a new partnership for unit 3
Negotiations were forced after the prohibitive terms of a Department of Energy (DoE's) loan guarantee put the joint development of an Areva EPR at the site in Maryland beyond Constellation's commercial reach. The US company called the DoE's credit cost calculations, which would have led to $880 million in charges to guarantee a private loan of $7.5 billion, "flawed, unrealistic and unworkable." It then appealed to its French partner with a cut-price offer to bail out of the project.
The result of talks is that EdF will buy Constellation's 50% stake in their joint venture, Unistar Nuclear Energy, for a mere $140 million and lead the firm as its sole shareholder. Unistar will own the site for Calvert Cliffs 3 as well as a potential fourth reactor and other plots at the Nine Mile Point and RE Ginna nuclear power plants. The $140 million figure compares most favourably with the $817 million invested so far by both companies in Calvert Cliffs 3.
EdF is also to transfer back some 3.5 million shares it holds in Constellation - worth about $109 million based on today's prices. Constellation has dropped its 'put option' under which it could have forced EdF to buy about $2 billion in fossil generation assets.
Unistar will become a wholly French project in the USA as it works to get the Areva EPR through licensing processes with the Nuclear Regulatory Commission (NRC). Both EdF and Areva are backed by the French state, while Unistar could still take the offer of US support should EdF consider the terms acceptable.
While EdF may pursue the construction of Calvert Cliffs 3, it would still need to find a US-based partner before the NRC can grant a combined construction and operating licence (COL). Under the US Atomic Energy Act, the NRC may not issue any commercial licenses to an entity 'owned, controlled or dominated' by a foreign company or government.
Calvert Cliffs 3 was the first new US project have a COL application lodged, with the first part reaching the NRC in July 2007. The final COL is expected to be ready in late 2012, marking a deadline for EdF to build a new partnership.
On its founding in July 2007, Unistar's goal was to build and operate a fleet of standardized EPRs in North America. Towards that end Areva has been working with Bechtel to complete the detailed design of the US version of the EPR and Alstom has been lined up to provide steam turbines. A COL application was put in for Nine Mile Point 3, but this has since been partially suspended.
Researched and written
by World Nuclear News