In the Matter of Dominion Nuclear Connecticut, Inc., Millstone Power Station, Unit Nos. 1, 2, and 3; Order Approving Indirect Transfer of Control of Licenses

Dominion Nuclear Connecticut, Inc. (DNC or the licensee) is licensed by the U.S. Nuclear Regulatory Commission (NRC or Commission) to possess and maintain, but not operate, Millstone Power Station, Unit No. 1, and possess, maintain, and operate (in conjunction with certain unaffiliated owners of Millstone, Unit No. 3) Millstone Power Station, Unit Nos. 2 and 3 (Millstone Units or the facilities) under Facility Operating License Nos. DPR-21, DPR-65, and NPF-49, issued by the Commission on October 7, 1970, September 26, 1975, and January 31, 1986, respectively. The Millstone Units are located at the licensee's site in New London County, Connecticut.

By application dated October 8, 2003, as supplemented November 7, 2003, DNC requested that the Commission consent, to the extent that proposed corporate restructuring results in an indirect transfer, to the indirect transfer of control of these facility operating licenses for the Millstone Units. The indirect transfer would result from the planned corporate restructuring involving certain intermediate subsidiaries of DNC's parent company, Dominion Resources, Inc. (DRI). DNC is a wholly-owned, indirect subsidiary of DRI.

DRI directly owns Virginia Electric & Power Company (VEPCO), Dominion Energy, Inc. (DEI), and Consolidated Natural Gas Company (CNG). DEI owns 100% of Dominion Nuclear, Inc. (DNI), and CNG owns 100% of Dominion Retail, Inc. (Retail). DNI is the parent company of Dominion Nuclear Holdings, Inc. (DNH), Dominion Nuclear Marketing I, Inc. (DNMI), Dominion Nuclear Marketing II, Inc. (DNMII), and Dominion Nuclear Marketing III, LLC (DNMIII). DNH and Retail also have part ownership of DNMIII. DNMI, DNMII, and DNMIII are the direct parent companies of DNC, the holder of the licenses of the Millstone Units. This corporate structure can be graphically seen as Exhibit B, “Current Corporate Ownership of Dominion Nuclear Connecticut,” in the October 8, 2003, Application.

The proposed corporate restructuring will have DRI continue to own VEPCO, DEI and CNG. Dominion Energy Marketing, Inc. (DEM) will be formed by merging DNMI and DNMII, and will be the direct subsidiary of DEI and a parent company of DNC. DNI will be eliminated and, therefore, will no longer be a subsidiary of DEI, and DNH will become a direct subsidiary of DEI. CNG will continue to be the direct parent company of Retail, and Retail will continue to be a direct parent company of DNMIII. Thus, only DEM and DNMIII will be the direct parent companies of DNC. This proposed corporate restructuring can be graphically seen as Exhibit C, “Corporate Ownership of Dominion Nuclear Connecticut, After Proposed Realignment,” in the October 8, 2003, Application.

DNC would continue to own (in the case of Millstone, Unit No. 3, along with certain unaffiliated co-owners) the Millstone Units following approval of the proposed indirect transfer of the license, and would continue to be exclusively responsible for the operation (except for Millstone Power Station, Unit No. 1), maintenance and eventual decommissioning of the facilities. No physical changes to the facilities or operational changes were proposed in the application.

Approval of the indirect transfer of the operating licenses was requested by DNC pursuant to title 10 of the Code of Federal Regulations (10 CFR), section 50.80. Notice of the request for approval and an opportunity for a hearing was published in the Federal Register on November 12, 2003 (68 FR 64132). 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 gives its consent in writing. After reviewing the information in the application from DNC and other information before the Commission, the NRC staff has determined that the corporate restructuring involving certain intermediate subsidiaries of DRI will not affect the qualifications of DNC as the holder of the licenses and that the indirect transfer of control of the licenses, to the extent effected by the foregoing transaction, is otherwise consistent with applicable provisions of law, regulations, and orders issued by the Commission, subject to the conditions set forth below. The foregoing findings are supported by a Safety Evaluation (SE) dated April 2, 2004.

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 indirect transfer of the control of Facility Operating License Nos. DPR-21, DPR-65 and NPF-49 referenced above is approved, subject to the following condition: should the planned restructuring by DRI not be completed by December 31, 2004, this Order shall become null and void, provided that upon written 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 application dated October 8, 2003, as supplemented on November 7, 2003, and the SE dated April 2, 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 accessible from the Agencywide Documents Access and Management Systems (ADAMS) Public Electronic Reading Room on the Internet at the NRC Web site, http://www.nrc.gov/NRC/ADAMS/index.html .