ML23103A191

Request for Threshold Determination Under 10 CFR 50.80

ML23103A191
Person / Time
Site:	Nine Mile Point
Issue date:	04/20/2023
From:	Hipolito Gonzalez NRC/NRR/DORL/LPL1
To:	O'Connor B Long Island Lighting Co, Long Island Power Authority
References
EPID L-2023-LRO-0008
Download: ML23103A191 (1)

Text

April 20, 2023 Ms. Bobbi J. OConnor General Counsel Long Island Power Authority 333 Eagle Ovington Boulevard Suite 403 Uniondale, NY 11553

SUBJECT:

NINE MILE POINT NUCLEAR STATION, UNIT 2 - REQUEST FOR THRESHOLD DETERMINATION UNDER 10 CFR 50.80 (EPID L-2023-LRO-0008)

Dear Ms. OConnor:

By letter dated February 15, 2023 (Agencywide Documents Access and Management System (ADAMS) Accession No. ML23047A364), the Long Island Power Authority (Authority) and its wholly-owned operating subsidiary, the Long Island Lighting Company doing business as LIPA (LILCO d/b/a LIPA), requested that the U.S. Nuclear Regulatory Commission (NRC, the Commission) make a threshold determination that a merger transaction planned between the Authority and LILCO d/b/a LIPA, in which the dissolution of LILCO d/b/a LIPA would result in LILCO d/b/a LIPAs 18-percent ownership interest in Nine Mile Point Nuclear Station, Unit 2 (NMP2), Renewed Facility Operating License No. NPF-69, subsequently being held by the Authority as the surviving entity, would not constitute a transfer of control under Title 10 of the Code of Federal Regulations (10 CFR), Section 50.80, Transfer of licenses, requiring prior approval by the Commission.

The NRC staff has completed its review and concludes that the proposed transaction resulting in the dissolution of the Authoritys wholly-owned subsidiary LILCO d/b/a LIPA through merger with the Authority, its parent entity, and by which LILCO d/b/a LIPAs 18-percent ownership interest in NMP2 would be held by the Authority as the surviving entity, would not constitute a direct or indirect transfer of control under 10 CFR 50.80. Therefore, prior NRC approval is not required for the merger and restructuring as described. The enclosed safety evaluation documents the NRC staffs review and findings.

B. OConnor If you have any questions, please contact the Nine Mile Point Nuclear Station Project Manager, Richard Guzman, at (301) 415-1030.

Sincerely, Digitally signed by Hipolito Hipolito J. J. Gonzalez Date: 2023.04.20 Gonzalez 10:18:20 -04'00' Hipólito J. González, Chief Plant Licensing Branch I Division of Operating Reactor Licensing Office of Nuclear Reactor Regulation Docket No. 50-410

Enclosure:

Safety Evaluation cc:

Mr. David Dardis Constellation Energy Generation, LLC Executive Vice President and General Counsel 1310 Point Street, 15th floor Baltimore, MD 21231 Additional Distribution via Listserv

SAFETY EVALUATION BY THE OFFICE OF NUCLEAR REACTOR REGULATION THRESHOLD DETERMINATION FOR THE PLANNED MERGER OF THE LONG ISLAND POWER AUTHORITY AND LONG ISLAND LIGHTING COMPANY D/B/A LIPA NINE MILE POINT NUCLEAR STATION, UNIT 2 DOCKET NO. 50-410

1.0 INTRODUCTION

By letter dated February 15, 2023 (Agencywide Documents Access and Management System Accession No. ML23047A364), the Long Island Power Authority (Authority) and its wholly-owned operating subsidiary, the Long Island Lighting Company doing business as LIPA (LILCO d/b/a LIPA), requested that the U.S. Nuclear Regulatory Commission (NRC, the Commission) make a threshold determination that a merger transaction planned between the Authority and LILCO d/b/a LIPA (the licensees), in which the dissolution of LILCO d/b/a LIPA would result in LILCO d/b/a LIPAs 18-percent ownership interest in Nine Mile Point Nuclear Station, Unit 2 (NMP2), Renewed Facility Operating License No. NPF-69, subsequently being held by the Authority as the surviving entity, would not constitute a transfer of control under Title 10 of the Code of Federal Regulations (10 CFR) 50.80, Transfer of licenses, requiring prior approval by the Commission.

2.0 BACKGROUND

As stated by the licensees, NMP2 currently has two co-licensees-Constellation Energy Generation, LLC (Constellation), which owns 82 percent of and operates NMP2, and LILCO d/b/a LIPA, a wholly-owned subsidiary of the Authority, which owns the remaining, minority 18 percent of NMP2. Constellation has exclusive responsibility and control over the physical possession, operation, and maintenance of the facility. The Authority has determined that its overall operations could be simplified by consolidating the Authority and its wholly-owned operating subsidiary, LILCO d/b/a LIPA, into one merged entity, with the Authority as the surviving entity. The anticipated form of dissolution would be through a merger of LILCO d/b/a LIPA with its parent entity, the Authority. As the surviving entity, the Authority would hold the 18-percent ownership interest in NMP2.

3.0 TECHNICAL EVALUATION

The NRC staff reviewed the licensees request for a threshold determination that a proposed organizational restructuring resulting in the dissolution of the Authoritys wholly-owned Enclosure

subsidiary LILCO d/b/a LIPA through merger with the Authority, and by which LILCO d/b/a LIPAs 18-percent ownership interest in NMP2 would be held by the Authority as the surviving entity, would not involve a direct or indirect transfer of control of the NRC license requiring prior NRC approval pursuant to the regulations governing the license (i.e., 10 CFR 50.80).

The regulation at 10 CFR 50.80(a) states, in part, that:

No license for a utilization facility ... or any right thereunder, shall be transferred, assigned, or in any manner disposed of, through transfer of control of the license to any person, unless the Commission gives its consent in writing.

As stated by the licensees, the Authority currently exercises financial and operational control over LILCO d/b/a LIPA, including the management of the 18-percent ownership interest in NMP2. All staffing of LILCO d/b/a LIPA is comprised of Authority employees, with control and oversight of LILCO d/b/a LIPA by the Authoritys Board of Trustees. Further, this control and oversight has included the exercise and fulfillment of rights and obligations, as well as assumption of liabilities, arising from holding the 18-percent ownership share of NMP2.

With Constellation as the operating licensee and maintaining an 82-percent ownership interest in NMP2, control and operations of the licensed facility will not change as a result of the merger and subsequent dissolution of LILCO d/b/a LIPA into the Authority, resulting in the 18-percent minority ownership interest of NMP2 being retained by the Authority. There would be no change in licensed activities or management or a transfer of control of NMP2 or its day-to-day operations as a result of the merger transaction and dissolution of LILCO d/b/a LIPA. The transaction would not involve any change to either the management organization or technical personnel of Constellation, which has exclusive responsibility under the operating license for operating and maintaining NMP2, and which is not involved in the proposed restructuring.

The NRC staff notes that the NRC had previously reviewed and approved the exercise of control by the Authority over the 18-percent ownership interest in NMP2 in LIPAs stock purchase of LILCO, when LILCO held the 18-percent minority interest in NMP2. Specifically, in 1997, the NRC approved the acquisition of LILCO and its assets in an indirect transfer to LIPA.

Thus, the NRC had previously granted consent for the exercise of control by the Authority in its 1997 acquisition of LILCO.

In summary, the NRC staff finds that the planned merger between the Authority and its wholly-owned operating subsidiary, LILCO d/b/a LIPA, would not be a transfer of control of the NMP2 license because the 18-percent ownership interest in the NMP2 license would continue to be controlled by the Authority after the merger and the merger would not involve Constellation.

4.0 CONCLUSION

Based on the above, the NRC staff concludes that the proposed organizational restructuring resulting in the dissolution of the Authoritys wholly-owned subsidiary LILCO d/b/a LIPA through merger with the Authority, its parent entity, and by which LILCO d/b/a LIPAs 18-percent ownership interest in NMP2 would be held by the Authority as the surviving entity, would not

constitute a direct or indirect transfer of control under 10 CFR 50.80. Therefore, prior NRC approval is not required for the merger and restructuring as described.

Principal Contributor: R. Turtil, NMSS Date: April 20, 2023

ML23103A191 OFFICE NRR/DORL/LPL1/PM NRR/DORL/LPL1/LA NMSS/REFS/FAB/BC NAME RGuzman KEntz FMiller DATE 04/13/2023 4/14/2023 04/13/2023 OFFICE OGC - NLO NRR/DORL/LPL1/BC NRR/DORL/LPL1/PM NAME JWachutka HGonzález RGuzman DATE 04/17/2023 04/20/2023 04/20/2023