Constellation moves for quick resolution

Friday, 15 October 2010

Electricité de France (EdF) may pursue Calvert Cliffs 3 alone, after Constellation offered a cut-price sale of its interest in the project. 

 

Calvert Cliffs 1 and 2

A letter today from Constellation chairman Michael Wallace to EdF's finance head Thomas Piquemal made the offer of a sale of its total interest in Calvert Cliffs 3 for just $117 million. This figure represents Constellation's contribution to general development work to prepare the Areva EPR for deployment in America. Wallace noted that this compares to some $817 million invested by both companies in the Calvert Cliffs 3 project overall.

 

The US utility's 50% share in project company Unistar Nuclear Energy (UNE) would be transferred to EdF for just $1. The joint venture was originally intended to support multiple EPR projects in North America using EdF's project managment and engineering capability combined with Constellation's operations expertise.

 

Wallace continued to pledge that EdF would have Constellation's full cooperation in executing the necessary agreements to transfer all Unistar interests and obligations and working through regulatory requirements. He explained again the company's reasons for refusing the terms of a loan guarantee from the US Department of Energy: At over 11.6%, the credit cost calculation on the guarantee of $7.5 billion in private lending was "too burdensome to be workable."

 

Constellation's board "stands ready to approve this transfer immediately, to ensure the best prospects for Unistar success." The full terms and conditions of the proposal were attached for quick response.

 

However, to go ahead with the project EdF will have to find a US-based partner. American legislation requires a domestic entity to control a majority stake in any nuclear power plant.

  

Researched and written

by World Nuclear News