Calvert Cliffs gets relicensed

BGE becomes first nuclear plant to get a 20-year renewal

`A significant milestone'

NRC approval given despite court case challenging action

March 24, 2000|By Shanon D. Murray | Shanon D. Murray,SUN STAFF

Baltimore Gas and Electric Co. became the nation's first electric utility yesterday to win relicensing of its nuclear power plant.

The U.S. Nuclear Regulatory Commission voted unanimously to extend the life of the Calvert Cliffs Nuclear Power Plant in Southern Maryland for another 20 years.

Calvert Cliffs' original operating licenses would have expired in 2014 for Unit 1, which began operating in 1974, and in 2016 for Unit 2, which began operating in 1976.

The license renewal moves the dates to 2034 and 2036, respectively.

"This is a significant milestone that helps to ensure a reliable, efficient and diversified fuel mix that further strengthens [our] domestic merchant energy strategy and its competitive focus," said Christian H. Poindexter, chairman, president and chief executive of Constellation Energy Group Inc., BGE's parent.

Calvert Cliffs is "a plant we'll be able to depend upon for a long time in the future," Poindexter said. "We've helped to bring a whole new renewed interest in nuclear power. We've paved the way, we've proven the process."

The NRC granted the approval despite a case that is pending before the U.S. Court of Appeals on whether the commission was correct in dismissing a hearing request by the National Whistleblower Center, a Washington advocacy group that opposed the license renewal.

The NRC dismissed the hearing request after the center failed to identify any issues within the scheduled time, it said.

Stephen Kohn, an attorney for the Whistleblower Center, said yesterday that the NRC was wrong to relicense Calvert Cliffs.

"Major safety issues remain open and unresolved, Kohn said. "The NRC has not made its case that Calvert Cliffs can operate for a total of 60 years safely. The NRC should have waited for the decision in the court case about whether they violated the Whistleblower Center's due process rights."

NRC officials said yesterday that the Court of Appeals did not issue an order preventing them from issuing the license renewal.

"We will abide by any order the court issues regarding the pending case as to whether the Whistleblower Center is entitled to a hearing," said Beth Hayden, a spokeswoman for the NRC.

Should that occur, the NRC could reconsider its decision, Hayden said.

Robert S. Fleishman, vice president of corporate affairs and general counsel of Constellation Energy Group, said the company disagrees with the Whistleblower Center.

"Our view is this has been a full and fair process. We are optimistic about the [case's] outcome," he said.

The NRC is reviewing license renewal applications from Duke Power Co., Entergy Operations Inc., and the Southern Nuclear Operating Co.

Boost to strategy

Yesterday's approval was seen as a boost to Constellation's strategy of becoming a national power provider and consultant on nuclear plants.

"This is great news, for Constellation Energy and for the industry," said Ronald S. Tanner, an analyst with Legg Mason Wood Walker in Baltimore. "There's a road map for other companies to follow to get their plants renewed as well. You have to give anyone credit who is willing to do it first. The process will be easier for anyone doing it now."

When electric deregulation takes effect in Maryland on July 1, and after it receives the necessary approvals, BGE will transfer its generating assets to nonregulated affiliates of Constellation Energy Group.

Moving to subsidiary

Calvert Cliffs will move to a subsidiary of Constellation Nuclear Group LLC, which manages the corporation's nuclear strategy and offers license renewal and engineering consulting through Constellation Nuclear Services, which began business in August. It has six clients.

The power generated by Calvert Cliffs will be marketed by Constellation Power Source, a domestic merchant energy business that markets and trades electricity and provides risk management services to wholesale customers nationwide.

Calvert Cliffs, on the western shore of the Chesapeake Bay in Calvert County, generates 1,700 megawatts of electricity, enough to meet the needs of nearly a half-million homes.

BGE provides service to more than 1.1 million electric customers.

Near record power

Last year, Calvert Cliffs generated a near-record 13.3 million megawatt hours.

The 2,500-page license renewal application for Calvert Cliffs was filed with the NRC in April 1998.

The regulatory commission's 22-month technical review examined safety and environmental concerns.

More than 30 public meetings were held during the review process.

The process cost Constellation about $20 million.

Constellation Energy Group's stock price closed yesterday at $30, up 37.5 cents.

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