In the Matter of Wisconsin Public Service Corporation, Wisconsin Power and Light Company, and Nuclear Management Company, LLC (Kewaunee Nuclear Power Plant, Unit No. 1); Order Approving Transfer of Operating Authority and Conforming Amendment

I

Wisconsin Public Service Corporation (WPSC), Wisconsin Power and Light Company (WPL), and Nuclear Management Company, LLC (NMC) (the licensees), are the holders of Facility Operating License No. DPR-43, which authorizes operation of Kewaunee Nuclear Power Plant, Unit No. 1 (Kewaunee or the facility). The facility is located at the licensees' site in Kewaunee County, Wisconsin. The license authorizes WPSC and WPL to possess, and NMC to use and operate, Kewaunee.

II

By application dated December 19, 2003, as supplemented February 18 and March 17, 2004, NMC, acting on behalf of itself and WPSC and WPL, requested approval of the transfer of Facility Operating License No. DPR-43 for Kewaunee from NMC, WPSC, and WPL to Dominion Energy Kewaunee, Inc. (Dominion Energy Kewaunee). NMC also requested approval of a conforming license amendment to reflect the transfer. The initial application and the supplements are hereinafter referred to as “the application” unless otherwise indicated. The application is in connection with the sale of the respective ownership interests in Kewaunee currently held by WPSC (59 percent) and WPL (41 percent) to Dominion Energy Kewaunee and the related transfer of operating authority for the facility from NMC to Dominion Energy Kewaunee. The application also requested a conforming amendment to reflect the transfer. The proposed amendment would reflect the proposed transfer of ownership and operating authority for Kewaunee to Dominion Energy Kewaunee; delete references to NMC, WPSC, and WPL in the license; change the name of Kewaunee Nuclear Power Plant to Kewaunee Power Station to reflect the name under which Dominion Energy Kewaunee plans to operate the facility, consistent with other nuclear plants owned by Dominion companies; and authorize Dominion Energy Kewaunee to possess, use, and operate Kewaunee, and to possess and use related licensed materials, under the same conditions and authorizations as in the current license.

Approval of the transfer of operating authority under the facility operating license and conforming license amendment was requested by NMC pursuant to 10 CFR 50.80 and 50.90. Notice of the application for approval and an opportunity for a hearing was published in the Federal Register on January 20, 2004 (69 FR 2734). No hearing requests or written comments were received.

Pursuant to 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. After reviewing the information in NMC's application and other information before the Commission, and relying upon the representations and agreements contained in the application, the NRC staff has determined that Dominion Energy Kewaunee is qualified to hold the license and that the transfer of the license to Dominion Energy Kewaunee 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, and the Commission's rules and regulations set forth in 10 CFR chapter 1; 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 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 foregoing findings are supported by a safety evaluation dated June 10, 2004.

III

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

(1) After receipt of all required regulatory approvals of the license transfer to Dominion Energy Kewaunee, NMC and Dominion Energy Kewaunee shall inform the Director, 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 before the date of closing. If the transfer is not completed by June 30, 2005, this Order shall become null and void, with the provision that, upon written application and for good cause shown, such date may in writing be extended.

(2) Dominion Energy Kewaunee shall take no action to cause Dominion Resources, Inc., or its successors and assigns, to void, cancel, or diminish their $60 million contingency commitment to Dominion Energy Kewaunee, the existence of which is represented in a Support Agreement in a letter to the NRC dated February 18, 2004, or cause them to fail to perform or impair their performance under the commitment, or remove or interfere with Dominion Energy Kewaunee's ability to draw upon the commitment. Also, Dominion Energy Kewaunee shall inform the NRC in writing any time that it draws upon the $60 million commitment.

(3) Dominion Energy Kewaunee is required to provide qualified decommissioning funds with a net (after tax) cash value of no less than $391.9 million for radiological decommissioning purposes. The funds will be deposited in an external trust fund to be segregated from Dominion Energy Kewaunee's other assets and outside its administrative control, as required by NRC regulations, and Dominion Energy Kewaunee shall take all necessary steps to ensure that this external trust fund is maintained in accordance with the requirements of the Order approving the transfer of the Kewaunee operating license and with the safety evaluation supporting the Order.

(4) Prior to completion of the transfer of the Kewaunee operating license, Dominion Energy Kewaunee shall provide the Director, Office of Nuclear Reactor Regulation, satisfactory documentary evidence that it has obtained the appropriate amount of insurance required of licensees under 10 CFR part 140 of the Commission's regulations.

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 transfer is completed.

This Order is effective upon issuance.

For further details with respect to this action, see the initial application dated December 19, 2003, and supplements dated February 18 and March 17, 2004, and the safety evaluation dated June 10, 2004 , 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 are accessible electronically through the ADAMS Public Electronic Reading Room link at the NRC Web site ( http://www.nrc.gov ).