RS-04-017, Request for Conforming Administrative License Amendments to Reflect Amergen Energy Company, LLC Ownership Change

Request for Conforming Administrative License Amendments to Reflect Amergen Energy Company, LLC Ownership Change

ML040420581
Person / Time
Site:	Oyster Creek, Clinton, Crane
Issue date:	01/30/2004
From:	Jury K AmerGen Energy Co
To:	Document Control Desk, Office of Nuclear Reactor Regulation
References
2130-04-20002, 5928-04-20014, RS-04-017
Download: ML040420581 (35)

Text

.i ewGen S Amer'Gn Energy Company, LLC 4300 Winfield Road An Exelon Company Warrenville, IL 60555 10 CFR 50.90 RS-04-017 2130-04-20002 5928-04-20014 January 30, 2004 U. S. Nuclear Regulatory Commission Attn: Document Control Desk Washington, DC 20555-0001 Clinton Power Station, Unit 1 Facility Operating License No. NPF-62 NRC Docket No. 50-461 Oyster Creek Generating Station Facility Operating License No. DPR-16 NRC Docket No. 50-219 Three Mile Island Nuclear Station, Unit I Facility Operating License No. DPR-50 NRC Docket No. 50-289

Subject:

Request for Conforming Administrative License Amendments to Reflect AmerGen Energy Company, LLC Ownership Change In accordance with 10 CFR 50.90, "Application for amendment of license or construction permit," AmerGen Energy Company, LLC (AmerGen) is requesting amendments to Facility Operating License Nos. NPF-62, DPR-16, and DPR-50 for Clinton Power Station, Unit 1 (Clinton), Oyster Creek Generating Station (Oyster Creek) and Three Mile Island Nuclear Station, Unit 1 (TMI-1), respectively. The proposed amendments would conform the operating licenses to reflect the current ownership structure of AmerGen.

On December 22, 2003, Exelon Generation Company, LLC (EGC) purchased 100% of the stock of British Energy US Holdings, Inc. (BE Holdings), which indirectly owns 50% of AmerGen. As such, EGC now owns 100% of AmerGen both directly and indirectly through its ownership of BE Holdings, which will be renamed Nuclear US Holdings, Inc. In connection with this acquisition, and pursuant to the prior written consent of the NRC dated December 15, 2003, EGC issued a contingency funding commitment to AmerGen in the amount of $200 million dated December 22, 2003, replacing prior contingency funding commitments of $100 million each from EGC and British Energy pIc, the indirect parent company of BE Holdings. EGC is an indirectly wholly owned subsidiary of Exe!on Corporation, a publicly traded U.S. company.

Accordingly, there is no longer any material indirect foreign ownership of AmerGen.

-Aco)

January 30, 2004 U. S. Nuclear Regulatory Commission Pac-2 When AmerGen acquired its interests in Clinton, Oyster Creek, and TMI-1, the predecessor to BE Holdings, British Energy, Inc., was a wholly owned subsidiary of British Energy pIc, a Scottish corporation. The transfer of the operating licenses to AmerGen presented three issues related to this ownership. First, it raised questions regarding the potential for foreign ownership, domination or control of those licenses. Second, AmerGen planned to hold nuclear decommissioning trust funds that were to be invested and preserved for decommissioning these plants. Third, British Energy pIc had provided contingency funding commitments that ultimately resulted in a commitment for up to $100 million in order to supplement the financial qualifications of AmerGen to own and operate Clinton, Oyster Creek and TMI-1.

In approving the transfer of control to AmerGen of the facilities now owned by AmerGen, the

$NRC imposed conditions in each of the licenses that were driven by or affected by the British Energy pIc indirect foreign ownership in AmerGen. First, the NRC imposed conditions to implement measures to negate the potential for foreign control or domination of AmerGen by British Energy plc. Second, the NRC imposed specific prohibitions on any investment of AmerGen nuclear decommissioning trust funds in British Energy, Inc. Third, the NRC imposed conditions relating to the contingency funding commitment provided by British Energy plc.

These conditions are no longer warranted based upon the current ownership structure of AmerGen. Thus, AmerGen is submitting this license amendment request to delete certain license conditions in their entirety and to revise certain license conditions, in order to conform the operating licenses to reflect the current 100% ownership of AmerGen by EGC.

The attached amendment request is subdivided as shown below. provides an evaluation of the proposed changes and contains the following sections:

1.0 Description 2.0 Proposed Changes

• 3.0

Background

4.0 Technical Analysis 5.0 Regulatory Analysis 5.1 No Significant Hazards Consideration This section describes our evaluation performed using the criteria in 10 CFR 50.91(a), "Notice for public comment," paragraph (1), which provides information supporting a finding of no significant hazards consideration using the standards in 10 CFR 50.92, "Issuance of amendment," paragraph (c).

- 5.2 Applicable Regulatory Requirements/Criteria

17 January 30, 2004 U. S. Nuclear Regulatory Commission Page 3 6.0 Environmental Consideration This section provides information supporting an environmental assessment.

7.0 References Attachments 2-A, 2-B and 2-C include the marked-up Facility Operating License pages with the proposed changes indicated for Clinton, Oyster Creek and TMI-1, respectively.

Attachments 3-A, 3-B and 3-C include the associated typed Facility Operating License pages with the proposed changes incorporated for Clinton, Oyster Creek and TMI-1, respectively. is a copy of the $200 million contingency funding commitment provided by EGC to AmerGen dated December 22, 2003.

We request approval of the proposed amendments by July 30, 2004.

The proposed amendments have been reviewed by the Clinton, Oyster Creek and TMI-1 Plant Operations Review Committees in accordance with the requirements of the AmerGen Quality Assurance Program.

AmerGen is notifying the State of Illinois, State of New Jersey, and Commonwealth of Pennsylvania of this application for a change to the operating licenses by sending a copy of this letter and its attachments to the designated State Official.

Should you have any questions concerning this letter, please contact Kenneth A. Ainger at (630) 657-2800.

I declare under penalty of perjury that the foregoing is true d correct.

Executed on Jdt Keith R. Jury Director - Licensing and Regulatory Affairs AmerGen Energy Company, LLC Attachments: :

Evaluation of Proposed Changes -A: Markup of Proposed Facility Operating License Changes for Clinton -B: Markup of Proposed Facility Operating License Changes for Oyster Creek -C: Markup of Proposed Facility Operating License Changes for TMI-1 -A: Typed Pages for Facility Operating License Changes for Clinton -B: Typed Pages for Facility Operating License Changes for Oyster Creek -C: Typed Pages for Facility Operating License Changes for TMI-1 :

EGC Contingency Funding Commitment

ATTACHMENT I

ATTACHMENT Evaluation of Proposed Changes INDEX

2.0 PROPOSED CHANGE

S

5.0 REGULATORY ANALYSIS

5.1 No Significant Hazards Consideration 5.2 Applicable Regulatory Requirements/Criteria

7.0 REFERENCES

1

ATTACHMENT I Evaluation of Proposed Changes

1.0 DESCRIPTION

In accordance with 10 CFR 50.90, Application for amendment of license or construction permit," AmerGen Energy Company, LLC (AmerGen) is requesting amendments to Facility Operating License Nos. NPF-62, DPR-1 6, and DPR-50 for Clinton Power Station, Unit 1, Oyster Creek Generating Station and Three Mile Island Nuclear Station, Unit 1, respectively.

The proposed amendments would conform the facility operating licenses to reflect the current ownership structure of AmerGen.

AmerGen is submitting this license amendment request to delete certain license conditions in their entirety and to revise certain license conditions, in order to conform the operating licenses to reflect the current 100% ownership of AmerGen by Exelon Generation Company, LLC (EGC).

There is no longer any indirect foreign ownership of AmerGen.

2.0 PROPOSED CHANGE

S 2.1 Clinton Power Station Unit 1, Facility Operating License No. NPF-62 2.1.1 2(C) License Transfer Conditions" is revised to delete paragraphs 10,11,12, and 13 in their entirety and insert the reference "Deleted." in each paragraph.

2.1.2 2(C)(16) which specifies "securities or other obligations of PECO Energy Company, British Energy, Inc.," is being revised to read "securities or other obligations of Exelon Corporation,"

2.1.3 2(C)(21) the following changes are proposed:

The contingency commitment parties PECO Energy Company or British Energy, Inc." are being replaced with Exelon Generation Company, LLC in four places.

The reference to the contingency commitment amount of "$110 million" is being replaced with "$200 million" in two places.

The reference to the contingency commitment agreement is being changed from the existence of which is represented in the application for the transfer of the Clinton License to AmerGen Energy Company, LLC," to "dated December 22, 2003,."

The phrase "or cause them to fail to perform or impair their performance" is being replaced with or cause it to fail to perform or impair its performance."

2.2 Oyster Creek Nuclear Generation Station, Facility Operating License No. DPR-1 6 2.2.1 3 "Sale and License Transfer Conditions" is revised to delete paragraphs A,B,C, and D in their entirety and insert the reference "Deleted." in each paragraph.

2.2.2 3(G) which specifies "securities or other obligations of PECO Energy Company, British Energy, Inc.," is being revised to read "securities or other obligations of Exelon Corporation,."

2

ATTACHMENT I Evaluation of Proposed Changes 2.2.3 3(L) the following changes are proposed:

The contingency commitment parties PECO Energy Company or British Energy, Inc." are being replaced with Exelon Generation Company, LLC."

The phrase or their affiliates, successors, or assigns, to void cancel or diminish their" is being replaced with "or its affiliates, successors, or assigns, to void cancel or diminish its."

The reference to the contingency commitment agreement is being revised from, the existence of which is represented in the initial November 5,1999 transfer application and in the AmerGen letter to the NRC dated April 6, 2000," to "dated December 22, 2003,."

The phrase "or cause them to fail to perform or impair their performance" is being replaced with "or cause it to fail to perform or impair its performance."

2.3 Three Mile Island Nuclear Station, Unit 1 Facility Operating License No. DPR-50 2.3.1 2(c) Sale and License Transfer Conditions" is being revised to delete paragraphs 10,11,12, and 13 in their entirety and insert the reference "Deleted."

in each paragraph.

2.3.2 2(c)(16) the following changes are proposed:

The contingency commitment parties PECO or British Energy, pic." are being replaced with the party "Exelon Generation Company, LLC" in three places.

The reference to the contingency commitment amount of "$65 million" is being replaced with "$200 million" in two places.

The reference to the contingency commitment agreement is being changed from "for TMI-1, the existence of which is represented in the application," to "dated December 22, 2003,."

The phrase "or cause them to fail to perform or impair their performance" is being replaced with "or cause it to fail to perform or impair its performance."

3.0 BACKGROUND

On December 22, 2003, EGC purchased 100% of the stock of British Energy US Holdings, Inc.

(BE Holdings), which indirectly owns 50% of AmerGen. As such, EGC now owns 100% of AmerGen both directly and indirectly through its ownership of BE Holdings, which will be renamed Nuclear US Holdings, Inc. In connection with this acquisition, and pursuant to the prior written consent of the NRC dated December 15, 2003, EGC issued a contingency funding commitment to AmerGen in the amount of $200 million dated December 22, 2003. This commitment replaced the prior contingency funding commitments of $100 million each from EGC and British Energy plc, the indirect parent company of BE Holdings. EGC is an indirectly wholly owned subsidiary of Exelon Corporation, a publicly traded U.S. company. As such, there is no longer any material indirect foreign ownership of AmerGen.

3.

IV ATTACHMENT I Evaluation of Proposed Changes When AmerGen acquired its interests in Clinton, Oyster Creek, and TMI-1, the predecessor to BE Holdings, British Energy, Inc., was a wholly owned subsidiary of British Energy plc, a Scottish corporation. The transfer of the operating licenses to AmerGen presented three issues related to this ownership. First, it raised questions regarding the potential for foreign ownership, domination or control of those licenses. Second, AmerGen planned to hold nuclear decommissioning trust funds that were to be invested and preserved for decommissioning these plants. Third, British Energy pic had provided contingency funding commitments that ultimately resulted in a commitment for up to $100 million in order to supplement the financial qualifications of AmerGen to own and operate Clinton, Oyster Creek, and TMI-1.

In approving the transfer of control to AmerGen of the licenses now owned by AmerGen, the NRC imposed conditions in each of the licenses that were driven by or affected by the British Energy pic indirect ownership in AmerGen. First, the NRC imposed conditions to implement measures to negate the potential for foreign domination or control by British Energy plc.

Second, the NRC imposed specific prohibitions on any investment of AmerGen nuclear decommissioning trust funds in British Energy, Inc. Third, the NRC imposed conditions relating to the contingency funding commitment provided by British Energy plc. These conditions are no longer warranted based upon the current ownership structure of AmerGen. Thus, AmerGen is submitting this license amendment request to delete certain license conditions in their entirety and to revise certain license conditions, in order to conform the operating licenses to reflect the current 100% ownership of AmerGen by EGC and Exelon Corporation, EGC's ultimate corporate parent.

4.0 TECHNICAL ANALYSIS

4.1 Changes related to the potential for foreign domination or control.

In accordance with 10 CFR 50.38, neligibility of certain applicants,' the NRC will not issue a reactor license to any entity that the NRC knows, or has reason to believe, is owned, controlled, or dominated by an alien, a foreign corporation, or a foreign government. In accordance with the NRC's Standard Review Plan Regarding Foreign Ownership, Control or Domination of Applicants for Reactor Licenses, AmerGen has implemented and maintained a negation action plan to mitigate the potential for foreign ownership, control or domination. In approving the transfers of the Clinton, Oyster Creek and TMI-1 licenses to AmerGen, the NRC imposed license conditions to assure that certain negation measures would remain in effect and to provide for a special notice requirement that would identify potential increases in the percentage of indirect foreign ownership interests in AmerGen.

British Energy plc no longer has an indirect ownership interest in AmerGen. Thus, the ownership structure of AmerGen no longer presents the potential for foreign ownership, control or domination, and negation measures are no longer warranted. AmerGen requests that the related NRC license conditions be deleted, in accordance with the more detailed description that follows:

4.1.1 Decision-making authority over safety issues, found in the following sections of the respective facility operating licenses: Clinton 2(C)(10); Oyster Creek 3(A);

TMI-1 2(c)(10).

4

ATTACHMENT I Evaluation of Proposed Changes License conditions in each facility operating license prohibit any material changes to the Limited Liability Company Agreement dated August 18, 1997 (LLC Agreement) regarding decision making authority over safety issues" without prior NRC approval. The LLC Agreement provides that the Chairman of the Management Committee would be appointed and removed only by a U.S.

controlled member group. Under Article 6.3(b)(i) of the LLC Agreement, the Chairman casts the tie breaking vote on the Management Committee regarding "all safety issues,' assuring the exercise of U.S. control and domination over safety concerns.

AmerGen is now a wholly owned indirect subsidiary of Exelon Corporation.

Thus, the ownership structure of AmerGen no longer raises the potential for foreign ownership, control or domination, and U.S. control of safety issues is assured without this negation measure. Accordingly, this license condition in each facility operating license is no longer warranted, and the proposed amendments delete this condition from each license.

4.1.2 U.S. member control of at least half of the appointments to AmerGen's Management Committee, found in the following sections of the respective facility operating licenses: Clinton 2(C)(1 1); Oyster Creek 3(B); TMI-1 2(c)(1 1).

This license condition in each facility operating license explicitly requires that the U.S. member group control at least half of the Management Committee of AmerGen. Because of this condition, a foreign-owned member group can never appoint more than half of the Management Committee.

AmerGen is now wholly owned by Exelon Corporation. Thus, the ownership structure of AmerGen no longer raises the potential for foreign ownership, control or domination, and U.S.-controlled members will appoint all members of the Management Committee. Accordingly, this license condition in each facility operating license is no longer warranted, and the proposed amendments delete this condition from each license.

4.1.3 Key officers must be U.S. citizens, found in the following sections of the respective facility operating licenses: Clinton 2(C)(1 2); Oyster Creek 3(C);

TMI-1 2(c)(12).

This condition in each facility operating license requires that the Chief Executive Officer, Chief Nuclear Officer, and the Chairman of AmerGen's Management Committee be U.S. citizens. It also requires that these three positions have exclusive control of the respective operating licenses.

AmerGen is now wholly owned by Exelon Corporation. Thus, the ownership structure of AmerGen no longer raises the potential for foreign ownership, control or domination, and there will be U.S. control of the selection of individuals in these positions. Accordingly, this license condition in each facility operating license is no longer warranted, and the proposed amendments delete this condition from each license.

5

LI ATTACHMENT I Evaluation of Proposed Changes 4.1.4 Requirement that AmerGen supply the NRC with Schedule 13D or 13G filings, found in the following sections of the respective facility operating licenses:

Clinton 2(C)(13); Oyster Creek 3(D); TMI-1 2(c)(13).

This license condition in each facility operating license requires that AmerGen transmit to the NRC any Securities and Exchange Commission Schedule 13D or 13G filings that disclose foreign beneficial ownership of any class of PECO stock.

Schedule 13D and 13G filings are required under the Securities Exchange Act of 1934, as amended, 15 USC 78m(d), when a party acquires beneficial ownership of five percent of a security. Given an existing indirect beneficial foreign ownership of a 50 percent interest in AmerGen, this license condition provided a mechanism for the NRC to identify whether or not any additional indirect foreign beneficial ownership had occurred.

AmerGen is now wholly owned by Exelon Corporation. Thus, the ownership structure of AmerGen no longer raises the potential for foreign ownership, control or domination, and there is no longer any special need to identify potential increases in the percentage of indirect foreign beneficial ownership of AmerGen.

Additionally, the NRC does not routinely require licensees to provide notices regarding 13D and 13G filings where foreign ownership, control or domination is not implicated. This license condition in each facility operating license is no longer necessary, and the proposed amendments delete it.

4.2 Changes related to Investment Restrictions Prior to the acquisition of BE Holdings by EGC, the facility operating licenses for Oyster Creek and Clinton specifically prohibited the respective decommissioning trust funds from investing in securities or other obligations of PECO Energy Company or British Energy, pc. Thus, the trust fund was prohibited from making investments in companies with significant ownership interests in AmerGen or their affiliates. Exelon Corporation is now the only publicly traded company with an ownership interest in AmerGen.

Investments in Exelon Corporation or any of its subsidiaries and affiliated companies, including PECO Energy Company, Nuclear US Holdings, and the companies it owns, would be prohibited by making reference to Exelon Corporation. These amendments delete the historical references and apply the prohibition to Exelon Corporation.

4.3 Changes related to new Contingency Funding Agreement Prior to the acquisition of BE Holdings by EGC, AmerGen had contingency funding commitments totaling $200 million, with $100 million committed from EGC and

$100 million committed from British Energy plc, the previous indirect parent company of BE Holdings. As a result of the acquisition of BE Holdings by EGC, and pursuant to the prior written consent of the NRC dated December 15, 2003, EGC has issued a new contingency funding commitment to AmerGen in the amount of $200 million. The prior funding commitments of $100 million each have been rescinded and are no longer in effect.

There is no change in the amount of funding commitments currently held by AmerGen.

However, the legacy" provisions in the licenses, referring to earlier funding commitments in varying amounts, no longer reflect the current status of AmerGen's 6

II ATTACHMENT I Evaluation of Proposed Changes funding commitment from EGC. The proposed amendments update the facility operating licenses to reflect that EGC has provided the contingency funding commitment in the amount of $200 million, dated December 22, 2003, and conform the operating licenses to reflect this.

5.0 REGULATORY ANALYSIS

5.1 NO SIGNIFICANT HAZARDS CONSIDERATION Overview In accordance with 10 CFR 50.90, Application for amendment of license or construction permit," AmerGen Energy Company, LLC (AmerGen) is requesting amendments to conform the operating licenses to reflect the current ownership structure of AmerGen.

Criteria According to 10 CFR 50.92, Issuance of amendment," paragraph (c), a proposed amendment to an operating license involves no significant hazards consideration if operation of the facility in accordance with the proposed amendment would not:

(1)

Involve a significant increase in the probability or consequences of an accident previously evaluated; or (2) Create the possibility of a new or different kind of accident from any accident previously evaluated; or (3)

Involve a significant reduction in a margin of safety.

In support of this determination, an evaluation of each of the three criteria set forth in 10 CFR 50.92 is provided below regarding the proposed license amendments.

1.

The proposed change does not involve a significant increase in the probability or consequences of an accident previously evaluated.

The proposed changes are administrative in nature and would merely conform the facility operating licenses to reflect the current ownership structure of AmerGen. No actual plant equipment or accident analyses will be affected by the proposed changes.

Therefore, the proposed changes do not involve a significant increase in the probability or consequences of an accident previously evaluated.

2.

The proposed change does not create the possibility of a new or different kind of accident from any accident previously evaluated.

The proposed changes are administrative in nature and would merely conform the facility operating licenses to reflect the current ownership structure of AmerGen. No actual plant equipment or accident analyses will be affected by the proposed changes and no failure modes not bounded by previously evaluated accidents will be created.

7

ATTACHMENT I Evaluation of Proposed Changes Therefore, the proposed changes do not create the possibility of a new or different kind of accident from any accident previously evaluated.

3.

The proposed change does not involve a significant reduction in a margin of safety.

The proposed change is administrative in nature and would merely conform the facility operating licenses to reflect the current ownership structure of AmerGen. No actual plant equipment or accident analyses will be affected by the proposed changes.

Additionally, the proposed changes will not relax any criteria used to establish safety limits, will not relax any safety system settings, or will not relax the bases for any limiting conditions for operation. Therefore, the proposed changes do not involve a significant reduction in any margin of safety.

Based on the above, it has been determined that the requested changes do not involve a significant increase in the probability or consequences of an accident previously evaluated; or.

create the possibility of a new or different kind of accident from any accident previously evaluated; or involve a significant reduction in a margin of safety. Therefore, the requested license amendments do not involve a significant hazards consideration under the standards set forth in 10 CFR 50.92(c).

5.2 APPLICABLE REGULATORY REQUIREMENTS/CRITERIA In accordance with 10 CFR 50.38, Ineligibility of certain applicants," the NRC will not issue a reactor license to any entity that the NRC knows, or has reason to believe, is owned, controlled, or dominated by an alien, a foreign corporation, or a foreign government. In accordance with the NRC's Standard Review Plan Regarding Foreign Ownership, Control or Domination of Applicants for Reactor Licenses, AmerGen implemented and maintained a negation action plan to mitigate the potential for foreign ownership, control or domination. In approving the transfers of the Clinton, Oyster Creek and TMI-1 licenses to AmerGen, the NRC imposed license conditions to assure that certain negation measures would remain in effect and to provide for a special notice requirement that would identify potential increases in the percentage of indirect foreign ownership interests in AmerGen.

Since the ownership structure of AmerGen no longer presents the potential for foreign ownership, control or domination, negation measures and the related facility operating license conditions are no longer required.

6.0 ENVIRONMENTAL CONSIDERATION

Overview In accordance with 10 CFR 50.90, Application for amendment of license or construction permit," AmerGen is requesting amendments to conform the facility operating licenses to reflect the current ownership structure of AmerGen.

8

ATTACHMENT I Evaluation of Proposed Changes Criteria AmerGen has evaluated the proposed operating license amendments consistent with the criteria for identification of licensing and regulatory actions requiring environmental assessment in accordance with 10 CFR 51.21, "Criteria for and identification of licensing and regulatory actions requiring environmental assessments." The proposed license amendments are administrative in nature and will not result in any change in the types, or any increase in the amounts, of any effluents that may be released off-site, and will not cause any increase in individual or cumulative occupational radiation exposure.

(i)

The amendment involves no significant hazards consideration.

As demonstrated in Section 5.1, No Significant Hazards Consideration," the proposed changes do not involve any significant hazards consideration.

(ii) - -There is no significant change in the types or significant increase in the amounts of any effluent that may be released offsite.

The proposed changes do not result in an increase in power level, do not increase the production nor alter the flow path or method of disposal of radioactive waste or byproducts; thus, there will be no change in the amounts of radiological effluents released offsite.

Based on the above evaluation, the proposed changes will not result in a significant change in the types or significant increase in the amounts of any effluent released offsite.

(iii)

There is no significant increase in individual or cumulative occupational radiation exposure.

The proposed changes will not result in any changes to the configuration of the facility.

The proposed changes revise the facility operating licenses to conform with the current ownership structure and will not cause a change in the level of controls or methodology used for the processing of radioactive effluents or handling of solid radioactive waste, nor will the proposed amendments result in any change in the normal radiation levels in the plant. Therefore, there will be no increase in individual or cumulative occupational radiation exposure resulting from these changes.

7.0 REFERENCES

1.

Limited Liability Company Agreement of AmerGen Energy Company, LLC dated August 18, 1997 9

1'.

ATTACHMENT 2-A Markup of Proposed Facility Operating License Page Changes CLINTON POWER STATION, UNIT I REVISED FACILITY OPERATING LICENSE PAGES Page 5 Page 6 Page 7 License Transfer Conditions (10) he AmerG Limited L lity Comp y Agreem t dated gust 18, 1 <7, and any ubsequen mendmen as of the ate of the rder appr ing the tra ferof thiicense to

erGen, y not be odified in any ma rial respe concemi decision-aking aut rity over fety issues' a efined them witho the prior tten con nt of the Director, Ofe of Nucl rReactoegulatlo (11) t least alf of the embers o AmerGen's anage rnt Commee shall

-.--- ~

b iappoied by a n foreign r~mber group all of wh h appoInNs A sh be U.citizens.

Amendment No. 130 (12)

The Chie xecutive Officer, ief.Nucer Office if some e othe than the hief Exec tive Offic ), and C irman o he Mana ement m'itt of A erGen E rgy Corn ny, LLC hall be

. citize Thes individ als shall ha the resp sibility an exclusiv authorit o ensur and sh 11 ensu, that the b siness an activities AmerG Energy ompan LLC

• th resp ct to the C license e at all tim s conduc 'd in a ma ner co istent ith the N protecti of the public health and safety nd con def se an security C the Unite States..

(13) meren nergy Co any, LL shall caus to be tra Rmitted t the Director, O ice of N lear React r Regulat n, within0 days o filing wit the U.S.

Sec ities an Exchange ommissio, any Sch dules 13 or 13G ed pursuant to th ecuritie Exchange ct of 193 that disc se bene ial owne hip of any registe d class f stock of CO Ener Compan or any ffiliate, s cessor or assig e of PE 0 Energy ompany t which p

's o rship mt est in AmerGen ay sub quently be ssigned o transferre with pr r written consent of e NRC,r the paren or owner such af ate, suc ssor, or assignee, wh hever e ity is the is ier of suc stock.

(14)

AmerGen is required to provide decommissioning funding assurance of no less than $210 million, after payment of any taxes, that will be deposited in the decommissioning trust fund for CPS at the time of CPS's transfer to AmerGen.

(15)

The decommissioning trust agreement for CPS must be in a form acceptable to the NRC.

a Ion ts on o

rton (16)

With respect to the decommissioning trust fu, investments in the securities or other obligations of iPEC Energy )

,ritsh Energy, 1nc, AmerGen Energy Company, LLC or affiliates thereof, or their successors or assigns shall be prohibited. Except for investments tied to market indexes or other nonnuclear sector mutual funds, investments in any entity owning one or more nuclear power plants are prohibited.

(17)

The decommissioning trust agreement for CPS must provide that no disbursements or payments from the trust shall be made by the trustee until the trustee has first given the NRC 30 days prior written notice of payment. The decommissioning 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 Director, Office of Nuclear Reactor Regulation.

(18)

The decommissioning trust agreement must provide that the agreement cannot be amended in any material respect without the prior written consent of the Director, Office of Nuclear Reactor Regulation.

Amendment No. 4-3-, 137 (19)

The appropriate section of the decommissioning trust agreement shall reflect 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.

(20)

AmerGen Energy Company, LLC shall take all necessary steps to ensure that the decommissioning trust is maintained in accordance with the application for approval of the transfer of the Clinton license to it and the requirements of the Order approving the transfer, and consistent with the safety evaluation supporting the Order.

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c~~eforane under the commitment, or remoer intrfee wth merGen's ability to draw upon the commitment. Also, AmerGen Energy Company, LLC shall inform the NRC in writing at any time that it draws upon the million commitment.

D.

The facility requires exemptions from cffan requirements of 10 CFR Part 50 and 10 CFR Part 70. These include: (a) an exemption from the requirements of 10 CFR 70.24 for the criticality alarm monitors around the fuel storage area; (b) an exemption from the requirement of 10 CFR Part 50, Appendix J - Option B, paragraph 1II.B, exempting the measured leakage rates from the main steam isolation valves from inclusion in the combined leak rate for local leak rate tests (Section 6.2.6 of SSER 6); and (c) an exemption from the requirements of paragraph III.B of Option B of 10 CFR Part 50, Appendix J, exempting leakage from the valve packing and the body-to-bonnet seal of valve E51-F374 associated with containment penetration IMC44 from inclusion in the combined leakage rate for penetrations and valves subject to Type B and C tests (SER supporting Amendment 62 to Facility Operating License No. NPF-62). The special circumstances regarding each exemption, except for Item (a) above, are identified in the referenced section of the safety evaluation report and the supplements thereto.

An exemption was previously granted pursuant to 10 CFR 70.24. The exemption was granted with NRC Material License No. SNM-1886, issued November 27, 1985, and relieved the licensee from the requirement of having a criticality alarm system. AmerGen Energy Company, LLC is hereby exempted from the criticality alarm system provision of 10 CFR 70.24 so far as this section applies to the storage of fuel assemblies held under this license.

Amendment No.42-137

or ATTACHMENT 2-B Markup of Proposed Facility Operating License Page Changes OYSTER CREEK GENERATING STATION REVISED FACILITY OPERATING LICENSE PAGES Page 6 Page 7 F.

The licensee shall have and maintain financial protection of such type and in such amounts as the Commission shall require in accordance with Section 170 of the Atomic Energy Act of 1954, as amended, to cover public liability claims.

3.

Sale and License Transfer Conditions:

A.

e Am en L ited Lia ity Co any Ag eement ted A ust 18, N97, a any su equen mend nts ther a as of t

he Ord

, appro Nng the tnsfer C the licen e to A erGen.

ay not modifie in any aterial repect c mcerningecisi-makin, utho v over fety isss" as de ed the in with t the p r write con nt of the Di ctor, fice of uclear R ctor Re, lation

/./

At ast half f the me bers of A ergen's anagem t Cornttee shaNe appointed by a onforei memberoup, al f whose,pointeeshall be 14S. citize\\

C.

Th Chief Ex utive Of cer (CEO Chief Nucl r Officer CNO) (i someo other than he CEO),

d the C irrnan of erGen's anageme Commit e shall U. S.

citize.

They sh I have th responsib ity and exc sive aut rity to e ure, an hall ensure. hat the bu ess and tivities o merGen w h respec to the 0 ter Cree operating icense are t all tim conducte n a manner onsisten with the rotection C the public eahh and s fety and mmon de nse and sec ty of t United tates.

D.

Al erGen s I1 cause to e transmitte to the Dir or, Offic of Nucler React Re ~ylation, hin 30 day of filing wi the U.S.

curities d Exch e Corission, any chedules D or 13G ed pursuan to the Sec rties Exc ge Act C 1934 at disclo benefici ownership C any regis red class f stock of ECO En rgy Co any or any a iliate, suc sessor, or as gnee of P 0 Energ Company o which ECO Energy C panys o nership mnt est in Am en maybe subseq ntly ass ned wit the prior w tten conse of the NRt\\

E.

AmerGen shall provide decommissioning funding assurance of no less than $400 million, after payment of any taxes, deposited in the decommissioning trust fund for Oyster Creek when Oyster Creek is transferred to AmerGen.

F.

The decommissioning trust agreement for Oyster Creek must be in a form acceptable to the NRC.

r C0 rpO04 4

G.

With respect to the decom iiing trust fund, investments in the securities or other obligations of PECO Energy C pcny, ritEnergy, Inc. AmerGen, or their affiliates, successors, or assigns shall be prohibited. Except for investments tied to market indexes or other nonnuclear sector mutual funds, investments in any entity owning one or more nuclear power plants are prohibited.

H.

The decommissioning trust agreement for Oyster Creek must provide that no disbursements or payments from the trust shall be made by the trustee unless the trustee has first given the NRC 30-days prior written notice of payment. The decommissioning 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 Director, Office of Nuclear Reactor Regulation.

Amendment No. 213

I 1.

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, Office of Nuclear Reactor Regulation.

J.

The appropriate section of the decommissioning 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.

K.

AmerGen shall take all necessary steps to ensure that the decommissioning trust is maintained in accordance with the application for approval of the transfer of the Oyster Creek license and the requirements of the Order approving the transfer, and consistent with the safety evaluation supporting such Order e

xconzGcalc C,,,paxv LCD L.

AmerGen shall take no action to cause lr:.

g rizisEnc r affiliates, successors, or assigns, to void, cancel, or diminish mS200illo contigency commitment to AmerGen, thc 4xstenee-ef-w'+ch4xpepresented in uhp 4ipizpL Nc A

mbe. 5. 1999 tLansfeF eppletion atnd ithe AmerGen letter to the NRC-datd April_

becemIr 22. 2003

-6, or cause to fail to perform or impair performance under the commitment, or remove or interfere with AmerGen's ability to draw upon the

~

commitment. Also, AmerGen shall inform the NRC in writing whenever it draws upon the S200 million commitment.

4.

This license is effective as of the date of issuance and shall expire at midnight on April 9, 2009.

FOR THE NUCLEAR REGULATORY COMMISSION Original Signed by Thomas E. Murley, Director Office of Nuclear Reactor Regulation

Attachment:

Appendices A and B -

Technical Specifications Date of Issuance: July 2, 1991 Amendment No.2 13

ATTACHMENT 2-C Markup of Proposed Facility Operating License Page Changes THREE MILE ISLAND NUCLEAR STATION, UNIT I REVISED FACILITY OPERATING LICENSE PAGES Page 7 Page 8

CONTROLLDCOPY 5.

The licensee shall provide routine reporting of the long-term corrosion "lead tests" test results on a quarterly basis as well as more timely notification if adverse corrosion test results are discovered.

(9) Long Range Planning Program The revised "Plan for the Long Range Planning Program for the Three Mile Island Nuclear Station - Unit 1 (the Plan) submitted by GPUN letter C311-94-2124 dated September 26, 1994 is approved.

a. The Plan shall be followed by the Licensee from and after November 28, 1994.

b.

The Category A schedule shall not be changed without prior approval from the NRC. Categories B and C schedules may be changed without prior approval by NRC.

Sale and License Transfer Conditions (10) e Limit Liability ompan Agreem t date August

,1997, ay note mo fied in ny mate respect concern g deci on-makihg author over afety issue as deined the in witho t the prio\\ written onsent the Director, Offi e of Nuclea eact Regula on.

(11 )

At le St half of e member of AmerGe\\'s Mana ment Co mittee sh I be appoi d by a nin-foreign member grou\\ all of whih appoin es shall b\\U.S.

citizens 1~e.Ie.4ed (12)

ThChief Execu ve Officer (

0), Chief uclear Off er (CNO) if someonkother than he CEO), an Chairman o the Manag ment Coi ittee of erGen s lI be U.S. c izens. Thes individuals all have th responsib ty and exlusive authorit to ensure, d shall ensu

, that the siness an activities f AmerG with respect to the T 1 license are t all times onducted Ha manneconsiste with the proection of th public health nd safety d commo defense nd security of t United St es.

(13) merGen hall cause be trans tted to the irector, 0 ice of Nuc ar Reactor R

Regulation ithin 30 dads of filing h the Secu ies and schange C

mission, an Schedul 13D or 1 filed purs ant to the curities a d Exchani Act of 1 93 hat discl se benefic I ownershi of a regist ed class stock of CO or any a iate, suc essor, or a signee of CO to whi PECO's wnership terest in Amer en may e subsequ tly assigned or transfe ed with t prior writt consent o the NR or the paret or owne f such affil te, succe or, or

assignee, ichever ntity is the suer of suh stock.

Amendment No. -*2 Amendment No. 207, 18, 28 I

CONTROE COPY (14)

AmerGen shall provide decommissioning funding assurance of no less than $303 million, after payment of any taxes, to be held in the decommissioning trust(s) for TMI-1 at the time of the transfer of the TMI-1 license to AmerGen, including any amounts held in any decommissioning trust(s) that may continue to be maintained by GPU Energy for TMI-1 after such license transfer.

(15)

AmerGen shall take all necessary steps to ensure that the decommissioning trust is maintained in accordance with the application, the requirements of the Order Approving Transfer of License and Conforming Amendment, dated April 12, 1999, and the related Safety Evaluation date 1999.

(16)

AmerGen shall take no action to caus tish g,

(or successors or asigns of FPCCO os~riisb,

-Per, approved by the NRC) to void, cancel, or (ZOO7m iinish the$~

w million contingency fund commitment from

,(or successors or assigns of -PEG ritis pprove y the A \\~~~~~~~~~~~~6QG e!-wh),G i F9 By6R or cause J

b e.der 22 23 to fail to perform or impair performance under the commitment, or remove

!+s or interfere with AmerGen's ability to draw upon the commitment. Further, AmerGen (ii shall inform the Director, Office of Nuclear Reactor Regulation, in writing, at such time that it draws upon the $imillion co n

tin g

e affect the NRC's authority to assure that adequate funds will remain available to fund the transition to safe shutdown, should any question arise regarding availability of funds for such a purpose.

6. This license is effective as of the date of issuance and shall expire at midnight, April 19, 2014.

FOR THE ATOMIC ENERGY COMMISSION Original Signed by A. Giambusso A. Giambusso, Deputy Director for Reactor Projects Directorate of Licensing

Attachment:

Appendix A Technical Specifications Date of Issuance: April 19, 1974 Amendment No. +9-2 Amendment No. 207, 210, 228

ATTACHMENT 3-A Typed Pages for Facility Operating License Changes CLINTON POWER STATION, UNIT I REVISED FACILITY OPERATING LICENSE PAGES Page 5 Page 6 Page 7 License Transfer Conditions (1 0)

Deleted.

(11)

Deleted.

Amendment (12)

Deleted.

(13)

Deleted.

(14)

AmerGen is required to provide decommissioning funding assurance of no less than $210 million, after payment of any taxes, that will be deposited in the decommissioning trust fund for CPS at the time of CPS's transfer to AmerGen.

(15)

The decommissioning trust agreement for CPS must be in a form acceptable to the NRC.

(16)

With respect to the decommissioning trust fund, investments in the securities or other obligations of Exelon Corporation, AmerGen Energy Company, LLC or affiliates thereof, or their successors or assigns shall be prohibited. Except for investments tied to market indexes or other nonnuclear sector mutual funds, investments in any entity owning one or more nuclear power plants are prohibited.

(17)

The decommissioning trust agreement for CPS must provide that no disbursements or payments from the trust shall be made by the trustee until the trustee has first given the NRC 30 days prior written notice of payment. The decommissioning 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 Director, Office of Nuclear Reactor Regulation.

(18)

The decommissioning trust agreement must provide that the agreement cannot be amended in any material respect without the prior written consent of the Director, Office of Nuclear Reactor Regulation.

Amendment.

(19)

The appropriate section of the decommissioning trust agreement shall reflect 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.

(20)

AmerGen Energy Company, LLC shall take all necessary steps to ensure that the decommissioning trust is maintained in accordance with the application for approval of the transfer of the Clinton license to it and the requirements of the Order approving the transfer, and consistent with the safety evaluation supporting the Order.

(21)

AmerGen Energy Company, LLC shall take no action to cause Exelon Generation Company, LLC, (or successors or assigns of Exelon Generation Company, LLC approved by the NRC) to void, cancel, or diminish the

$200 million contingency commitment from Exelon Generation Company, LLC, (or successors or assigns of Exelon Generation Company, LLC approved by the NRC) dated December 22, 2003, or cause it to fail to perform or impair its performance under the commitment, or remove or interfere with AmerGen's ability to draw upon the commitment. Also, AmerGen Energy Company, LLC shall inform the NRC in writing at any time that it draws upon the $200 million commitment.

D.

The facility requires exemptions from certain requirements of 10 CFR Part 50 and 10 CFR Part 70. These include: (a) an exemption from the requirements of 10 CFR 70.24 for the criticality alarm monitors around the fuel storage area; (b) an exemption from the requirement of 10 CFR Part 50, Appendix J - Option B, paragraph lll.B, exempting the measured leakage rates from the main steam isolation valves from inclusion in the combined leak rate for local leak rate tests (Section 6.2.6 of SSER 6);

and (c) an exemption from the requirements of paragraph lll.B of Option B of 10 CFR Part 50, Appendix J, exempting leakage from the valve packing and the body-to-bonnet seal of valve 1 E51-F374 associated with containment penetration 1 MC-44 from inclusion in the combined leakage rate for penetrations and valves subject to Type B and C tests (SER supporting Amendment 62 to Facility Operating License No.

NPF-62). The special circumstances regarding each exemption, except for Item (a) above, are identified in the referenced section of the safety evaluation report and the supplements thereto.

An exemption was previously granted pursuant to 10 CFR 70.24. The exemption was granted with NRC Material License No. SNM-1 886, issued November 27,1985, and relieved the licensee from the requirement of having a criticality alarm system.

AmerGen Energy Company, LLC is hereby exempted from the criticality alarm system provision of 10 CFR 70.24 so far as this section applies to the storage of fuel assemblies held under this license.

Amendment

ATTACHMENT 3-B Typed Pages for Facility Operating License Changes OYSTER CREEK GENERATING STATION REVISED FACILITY OPERATING LICENSE PAGES Page 6 Page 7

- F.

The licensee shall have and maintain financial protection of such type and in such amounts as the Commission shall require in accordance with Section 170 of the Atomic Energy Act of 1954, as amended, to cover public liability claims.

3.

Sale and License Transfer Conditions:

A.

Deleted.

B.

Deleted.

C.

Deleted.

D.

Deleted E.

AmerGen shall provide decommissioning funding assurance of no less than $400 million, after payment of any taxes, deposited in the decommissioning trust fund for Oyster Creek when Oyster Creek is transferred to AmerGen.

F.

The decommissioning trust agreement for Oyster Creek must be in a form acceptable to the NRC.

G.

With respect to the decommissioning trust fund, investments in the securities or other obligations of Exelon Corporation, AmerGen, or their affiliates, successors, or assigns shall be prohibited. Except for investments tied to market indexes or other nonnuclear sector mutual funds, investments in any entity owning one or.

more nuclear power plants are prohibited.

H.

The decommissioning trust agreement for Oyster Creek must provide that no disbursements or payments from the trust shall be made by the trustee unless the trustee has first given the NRC 30-days prior written notice of payment. The decommissioning 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 Director, Office of Nuclear Reactor Regulation.

Amendment No. 24, I.

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, Office of Nuclear Reactor Regulation.

J.

The appropriate section of the decommissioning 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.

K.

AmerGen shall take all necessary steps to ensure that the decommissioning trust is maintained in accordance with the application for approval of the transfer of the Oyster Creek license and the requirements of the Order approving the transfer, and consistent with the safety evaluation supporting such Order.

L.

AmerGen shall take no action to cause Exelon Generation Company, LLC or its affiliates, successors, or assigns, to void, cancel, or diminish its $200 million contigency commitment to AmerGen, dated December 22, 2003, or cause it to fail to perform or impair its performance under the commitment, or remove or interfere with AmerGen's ability to draw upon the commitment. Also, AmerGen shall inform the NRC in writing whenever it draws upon the $200 million commitment.

4.

This license is effective as of the date of issuance and shall expire at midnight on April 9, 2009.

FOR THE NUCLEAR REGULATORY COMMISSION Original Signed By Thomas E. Murley, Director Office of Nuclear Reactor Regulation

Attachment:

Appendices A and B -

Technical Specifications Date of Issuance: July 2, 1991 Amendment No. 243,

ATTACHMENT 3-C Typed Pages for Facility Operating License Changes THREE MILE ISLAND NUCLEAR STATION, UNIT I REVISED FACILITY OPERATING LICENSE PAGES Page 7 Page 8

- 5.

The licensee shall provide routine reportirig of the long-term corrosion "lead tests" test results on a quarterly basis as well as more timely notification if adverse corrosion test results are discovered.

(9)

Long Range Planning Program The revised Plan for the Long Range Planning Program for the Three Mile Island Nuclear Station - Unit 1" (the Plan) submitted by GPUN letter C311-94-2124 dated September 26, 1994 is approved.

a.

The Plan shall be followed by the Licensee from and after November 28, 1994.

b.

The Category A schedule shall not be changed without prior approval from the NRC. Categories B and C schedules may be changed without prior approval by NRC.

Sale and License Transfer Conditions (1 0)

Deleted.

(11)

Deleted.

(12)

Deleted.

(13)

Deleted.

Amendment No. 92 Amendment No. 27 2&, 228, (14)

AmerGen shall provide decommissioning funding assurance of no less than

$303 million, after payment of any taxes, to be held in the decommissioning trust(s) for TMI-1 at the time of the transfer of the TMI-1 license to AmerGen, including any amounts held in any decommissioning trust(s) that may continue to be maintained by GPU Energy for TMI-1 alter such license transfer.

(15)

AmerGen shall take all necessary steps to ensure that the decommissioning trust is maintained in accordance with the application, the requirements of the Order Approving Transfer of License and Conforming Amendment, dated April 12, 1999, and the related Safety Evaluation dated April 12, 1999.

(16)

AmerGen shall take no action to cause Exelon Generation Company, LLC (or successors or assigns of Exelon Generation Company, LLC approved by the NRC) to void, cancel, or diminish the $200 million contingency fund commitment from Exelon Generation Company, LLC, (or successors or assigns of Exelon Generation Company, LLC approved by the NRC) dated December 22, 2003, or cause it to fail to perform or impair its performance under the commitment, or remove or interfere with AmerGen's ability to draw upon the commitment.

Further, AmerGen shall inform the Director, Office of Nuclear Reactor Regulation, in writing, at such time that it draws'upon the $200 million contingency fund. This provision does not affect the NRC's authority to assure that adequate funds will remain available to fund the transition to safe shutdown, should any question arise regarding availability of funds for such a purpose.

6. This license is effective as of the date of issuance and shall expire at midnight, April 19, 2014.

FOR THE ATOMIC ENERGY COMMISSION Original Signed by A. Giambusso A. Giambusso, Deputy Director for Reactor Projects Director of Licensing

Attachment:

Appendix A Technical Specifications Date of Issuance: April 19, 1974 Amendment No.

Amendment No. 207, 218, 228,

ATTACHMENT 4 Exelon Generation Company, LLC Funding Agreement Dated December 22, 2003

Exelon Generation Company, LLC 4300 Winfield Road Warrenville, Illinois 60555 December 22, 2003 AmerGen Energy Company, LLC 200 Exelon Way Kennett Square, PA 19348

Subject:

Funding Agreement Ladies and Gentlemen:

Reference is made to a letter agreement dated January 12, 2001 (January 12, 2001 Agreement), pursuant to which Exelon Generation Company, LLC (EGC) agreed to provide funding to AmerGen Energy Company, LLC (AmerGen) in connection with the operation and maintenance of all of the commercial nuclear power reactors now owned or to be acquired by AmerGen, and to a letter agreement dated April 3, 2000 (April 3, 2000 Agreement) pursuant to which British Energy plc (British Energy) agreed to provide funding to AmerGen under the same or similar terms and conditions as the January 21, 2001 Agreement.

Pursuant to this funding agreement, EGC agrees to assume all of British Energy's obligations under the April 3, 2000 Agreement, as well as its own obligations under the January 12, 2001 Agreement. Thus, EGC will provide funding of up to a total of $200 million to be available to AmerGen in connection with the operation and maintenance of all of the commercial nuclear power reactors already owned or to be acquired by AmerGen, or any other wholly owned subsidiary of AmerGen. This funding agreement substitutes for the January 12, 2001 Agreement, which is hereby rescinded, and EGC acknowledges that the April 3, 2000 Agreement is discontinued, revoked, rescinded, void and unenforceable pursuant to the prior written consent of the Nuclear Regulatory Commission (NRC) dated December 15, 2003, because the obligations thereunder have been assigned to, and assumed by, EGC pursuant to this funding agreement.

In consideration of the benefits to be derived by EGC from AmerGen's ownership and operation of commercial nuclear reactors (directly or indirectly through any wholly owned subsidiary), the mutual benefits to be derived by AmerGen and EGC from the commitments contemplated hereunder, in furtherance of the Limited Liability Company Agreement of AmerGen (LLC Agreement) dated as of August 18, 1997, and as amended and restated from time to time, and any provision in the LLC Agreement which could limit application of this letter agreement notwithstanding, EGC hereby agrees that, subject to the terms and conditions of this funding agreement, it will provide funds pursuant to the terms of this letter agreement to AmerGen to assure that AmerGen will have sufficient funds available to meet its expenses.

EGC represents and warrants that it will provide funding to AmerGen at any time that the Management Committee of AmerGen determines that, in order to protect the public health and safety and/or to comply with NRC requirements, such funds are necessary to meet the ongoing operating expenses at any AmerGen operating nuclear power plant or such funds are necessary to safely maintain any such plant; provided, however, that EGC's maximum liability to

provide funding hereunder shall not exceed $200 million cumulatively over the life of this agreement.

This agreement shall take effect immediately and will remain in effect and remain irrevocable until such time as either: (1) AmerGen has submitted to the NRC a written certification meeting the requirements of 10 CFR. 50.4(b)(8) & (9) that the fuel has been permanently removed from the reactor vessel of the last plant operated by AmerGen (including any plant operated by any wholly owned subsidiary of AmerGen), i.e., after AmerGen has determined to permanently cease operations at its last operating reactor; or (2) NRC has given its prior written consent to the discontinuance of the funding arrangement contemplated by this funding agreement.

EGC shall have the right to demand that AmerGen permanently cease operations at any plant rather than using funds available under this agreement for continued operations, provided that, in such event, AmerGen will nevertheless have the right to continue to obtain the funds necessary to assure the safe and orderly shutdown of any such plant and to continue the safe maintenance of any such plant until AmerGen can certify to the NRC that the fuel has been permanently removed from the reactor vessel.

EGC hereby represents and warrants to AmerGen that its obligations under this funding agreement are valid, binding and enforceable obligations of EGC in accordance with their terms (subject to bankruptcy, insolvency, reorganization and similar laws affecting creditors' rights generally and general equitable principles) and does not require the consent, approval or authorization of any Governmental Agency or third party other than those which have been obtained and are in full force and effect on the date hereof.

EGC hereby irrevocably, unconditionally and expressly waives, and agrees that it shall not at any time assert any claim or take the benefit or advantage of, any appraisal, valuation, stay, extension, marshaling of assets or redemption laws, any bankruptcy, insolvency or similar proceedings, or exemption, whether now or any time hereafter in force, which may delay, prevent or otherwise affect the performance by EGC of its obligations hereunder.

This funding agreement shall be governed and construed in accordance with the laws of the Commonwealth of Pennsylvania without giving effect to conflict of law principles.

Very truly yours, Exelon Generation Company, LLC By:

e s

Edward J.Alllen, r.\\

Vice Prt_,den