In the Matter of Florida Power Corporation (Crystal River Unit No. 3); Order Approving Application Regarding Proposed Acquisition by CP&L Holdings, Inc. of Florida Progress Corporation

I

Florida Power Corporation (FPC) is the majority owner and a holder of Facility Operating License No. DPR-72 for Crystal River Unit 3 (CR-3), which was issued December 3, 1976. FPC owns a 91.7806% interest in CR-3, with the remaining interest held by nine minority owners. FPC is the licensed operator of CR-3.

II

Pursuant to Section 184 of the Atomic Energy Act of 1954, as amended, and 10 CFR 50.80, FPC filed an application dated January 31, 2000, requesting approval of the indirect transfer of control of FPC's interest in the CR-3 operating license that will occur under a proposed share exchange transaction between Florida Progress Corporation (Progress), the parent of FPC, and CP&L Holdings, Inc. (Holdings). Holdings is being formed by Carolina Power and Light Company (CP&L) as part of an internal CP&L reorganization. Upon consummation of the share exchange transaction, under which Holdings will acquire all of the outstanding shares of Progress, Progress will become a wholly owned subsidiary of Holdings. FPC, which will remain a wholly owned subsidiary of Progress, will also become an indirect subsidiary of Holdings upon completion of the acquisition of Progress by Holdings. FPC will retain its existing ownership interest in and the license for CR-3 and remain the licensed operator of CR-3 after the share exchange transaction. No physical changes to the facility or operational changes are being proposed in the application. Additional information concerning this indirect transfer is contained in a letter from CP&L to the U.S. Nuclear Regulatory Commission (Commission) dated February 14, 2000, and in a letter from FPC to the Commission dated March 28, 2000. Notice of the application and an opportunity for hearing was published in the Federal Register on March 17, 2000 (65 FR 14631). No hearing requests were filed.

Under 10 CFR 50.80, no license shall be transferred, directly or indirectly, through transfer of control of the license, unless the Commission gives its consent in writing. Upon review of the information submitted by FPC in its application, and the other information before the Commission, the NRC staff has determined that the proposed acquisition of Progress by Holdings through the proposed share exchange transaction will not affect the qualifications of FPC as a holder of the license referenced above, and that the indirect transfer of the license, to the extent effected by the acquisition, is otherwise consistent with applicable provisions of law, regulations, and orders issued by the Commission subject to the conditions set forth herein. These findings are supported by a Safety Evaluation dated May 22, 2000.

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 application regarding the subject acquisition is approved, subject to the following conditions:

(a) FPC shall provide the Director of the Office of Nuclear Reactor Regulation a copy of any application, at the time it is filed, to transfer (excluding grants of security interests or liens) from FPC to its existing or proposed direct or indirect parent or to any other affiliated company, facilities for the production, transmission, or distribution of electric energy having a depreciated book value exceeding ten percent (10%) of FPC's consolidated net utility plant, as recorded on FPC's book of accounts,

(b) Should the acquisition of Progress by Holdings not be completed by June 1, 2001, this Order shall become null and void, provided, however, on application and for good cause shown, such date may be extended. This Order is effective upon issuance.

For further details with respect to this action, see the initial application dated January 31, 2000, additional information contained in a letter from CP&L to the Commission dated February 14, 2000, a letter from FPC to the Commission dated March 28, 2000, and the Safety Evaluation dated May 23, 2000, which are available for public inspection at the Commission's Public Document Room, the Gelman Building, 2120 L Street, NW., Washington, DC, and accessible electronically through the ADAMS Public Electronic Reading Room link at the NRC Web site (http://www.nrc.gov).