In the Matter of Wisconsin Public Service Corporation, et al. (Kewaunee Nuclear Power Plant); Order Approving Transfer of License and Conforming Amendment

I.

Wisconsin Public Service Corporation (WPSC), Madison Gas & Electric Company (MG&E), and Wisconsin Power & Light Company (WP&L) are the licensed owners and Nuclear Management Company, LLC (NMC), is the exclusive licensed operator of the Kewaunee Nuclear Power Plant (KNPP), and in regard thereto, hold Facility Operating License No. DPR-43. KNPP (the facility) is located in Kewaunee County, Wisconsin.

II.

By application dated April 30, 2001, as supplemented June 27 and August 3, 2001, NMC, on behalf of WPSC, MG&E, and WP&L, requested the consent of the U.S. Nuclear Regulatory Commission (NRC or Commission) to a proposed transfer of the license for KNPP, to the extent held by MG&E, to WPSC. The application and supplements are collectively herein referred to as “the application,” unless otherwise indicated. The application also requested the approval of a conforming license amendment to reflect the transfer of the license.

In connection with the transfer, WPSC, presently the holder of a 41.2-percent ownership interest in KNPP, would assume the 17.2-percent ownership interest in KNPP currently held by MG&E, resulting in WPSC holding a 59-percent ownership interest in KNPP. WP&L is not involved in the transfer of MG&E's interest and will remain a licensee with respect to its 41-percent ownership interest in KNPP. NMC will maintain its responsibility for the operation of KNPP. The application states that WPSC would assume the decommissioning funding assurance obligation that is currently the responsibility of MG&E, in addition to remaining responsible for such costs associated with WPSC's current ownership interest in KNPP.

The proposed conforming license amendment would delete references to MG&E in the license, as appropriate, to reflect the proposed transfer.

The application requested approval of the transfer of the license and the conforming license amendment pursuant to 10 CFR 50.80 and 10 CFR 50.90. The NRC staff published a notice of the request for approval of the transfer of the license and conforming amendment, and an opportunity for a hearing in the Federal Register on July 27, 2001 (66 FR 39214). The Commission received no requests for hearing or written comments pursuant to the notice.

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 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 WPSC is qualified to hold the license to the extent proposed in the application, and that the transfer of the license, to the extent held by MG&E, to WPSC, 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 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 amendment 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 a safety evaluation dated September 20, 2001.

III.

Accordingly, pursuant to sections 161b, 161i, 161o and 184 of the Atomic Energy Act of 1954, as amended, 42 U.S.C. 2201(b), 2201(i), 2201(o) and 2234; and 10 CFR 50.80, it is hereby ordered that the transfer of the license, as described herein, to WPSC is approved, subject to the following conditions:

(1) WPSC shall take all necessary steps to ensure that the decommissioning trusts are maintained in accordance with the license transfer application regarding the transfer of MG&E's ownership interest in KNPP to WPSC and the requirements of this Order approving the transfer, and consistent with the safety evaluation supporting this Order. Additionally, if the MG&E Nonqualified Fund is not transferred to WPSC, WPSC, or NMC acting on WPSC's behalf, shall explicitly include the status of the MG&E Nonqualified Fund in all future decommissioning funding status reports that WPSC, or NMC, submit in accordance with 10 CFR 50.75(f)(1).

(2) On the closing date of the transfer of MG&E's interest in KNPP to WPSC, MG&E shall transfer to WPSC all of MG&E's accumulated qualified decommissioning trust funds for KNPP. Immediately following such transfer, the amounts for radiological decommissioning of KNPP in WPSC's decommissioning trusts must, with respect to the interests in KNPP that WPSC would then hold, be at a level no less than the formula amounts under 10 CFR 50.75.

(3) After receipt of all required regulatory approvals of the transfer of MG&E's interest in KNPP to WPSC, WPSC or NMC 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.

(4) If the transfer of the license is not completed by September 30, 2002, this Order shall become null and void, provided, however, upon written application and for good cause shown, such date may in writing be extended.

It is further ordered that, consistent with 10 CFR 2.1315(b), a license amendment that makes changes, as indicated in Enclosure 2 to the cover letter forwarding this Order, to conform the license to reflect the subject license transfer is approved. The amendment shall be issued and made effective at the time the proposed license transfer is completed.

This Order is effective upon issuance.

For further details with respect to this Order, see the initial application dated April 30, 2001, the supplemental submittals dated June 27 and August 3, 2001, and the safety evaluation dated September 20, 2001, which are available for public inspection at the Commission's Public Document Room, located at One White Flint North, 11555 Rockville Pike (first floor), Rockville, Maryland, and accessible electronically through the ADAMS Public Electronic Reading Room link at the NRC Web site (http://www.nrc.gov).