EDF dividend from US consolidation

Three US nuclear plants co-owned by EDF and Constellation Energy Nuclear Group are to be integrated into Exelon's nuclear fleet under a newly announced agreement that will see the French company receive a $400 million dividend.

Three US nuclear plants co-owned by EDF and Constellation Energy Nuclear Group are to be integrated into Exelon's nuclear fleet under a newly announced agreement that will see the French company receive a $400 million dividend.

Nine Mile Point's two units will be integrated into Exelon's fleet (Image: Exelon)

CENG is owned 50.1% by Exelon, the USA's largest operator of commercial nuclear plants, and 49.9% by EDF. It currently operates five reactors across the states of New York and Maryland: a single PWR unit at RE Ginna, two BWRs at Nine Mile Point and two PWRs at Calvert Cliffs. The newly announced agreement will see the operating licenses for the units transferred to Exelon, to be integrated into Exelon's management model. Exelon will lend $400 million to CENG to support a special dividend to EDF, and EDF will retain an option to sell its stake in CENG to Exelon at a "fair market value" between January 2016 and June 2022.

Exelon Nuclear president and chief nuclear officer Michael Pacilio described the move as a "logical step forward" following the 2012 merger of Exelon and Constellation. "This consolidation will benefit both Exelon and our partner EDF and allows us to take advantage of additional synergies and streamlining," he said.

An application to transfer CENG's operating licenses to Exelon will be submitted to the US Nuclear Regulatory Commission "within days" and the integration process is expected to take around nine months to complete.

EDF purchased its share of Constellation Energy in 2009, giving it a toehold in US nuclear generation. However, its plans for involvement in US nuclear new-build through the Unistar joint venture were stymied when Constellation pulled out of the consortium in 2010, and the project became 100% owned by EDF. US nuclear regulations implacably prohibit foreign companies from obtaining nuclear operating licenses.

According to half-yearly figures announced by EDF, as well as enabling the company to reduce its net financial debt by $400 million the agreement will have a "slightly accretive" effect from 2015 as the anticipated operating improvements and synergies from Exelon's management of the units are achieved.

Researched and written
by World Nuclear News