French-owned UniStar not eligible to build nuclear reactor at Calvert Cliffs

Federal officials said Friday that UniStar Nuclear Energy is not eligible to build a third reactor at Calvert Cliffs because it is not a U.S.-owned company, but also said they would continue to process its application.

The Nuclear Regulatory Commission said in a letter that although a review of the application for the $9.6 billion reactor in Southern Maryland will still take place, a license would not be issued until the ownership requirements were met.

Federal law prohibits complete ownership or control of a U.S. nuclear plant by a foreign entity. UniStar is owned by French energy group EDF.

"We'll continue our review," said Diane Screnci, spokeswoman for the NRC's regional office in Philadelphia, which has supervision over Calvert Cliffs.

A spokeswoman for UniStar said the letter does not rule out the company's plans to seek approval to own and operate the reactor. The company has consistently said it ultimately will have a U.S. partner, said the spokeswoman, Kelly Sullivan.

"While EDF and UniStar disagree with the Nuclear Regulatory Commission's conclusion regarding UniStar's present governance structure, we are pleased that the NRC will continue to review all other aspects of our pending application," Sullivan said. "This allows the project to continue moving forward as anticipated."

Sullivan said UniStar will continue to work with the commission to resolve the governance issue. The company has not said when it would find a U.S. partner.

News that UniStar does not meet ownership requirements is not a surprise.

EDF formed UniStar in 50-50 partnership with Baltimore-based Constellation Energy Group with plans to develop several nuclear plants in the United States, including at Calvert Cliffs. Constellation pulled out of negotiations last year over a federal loan guarantee needed to finance the reactor.

Constellation left UniStar on its own to build the plants when CEG pulled out.

In December, UniStar gave the NRC a plan that it said would provide U.S. control without a local partner. It included having two U.S. citizens on its eight-member board and requiring that its chairman and chief executive be U.S. citizens.

The company also set up a security subcommittee whose members would be the board chairman and two U.S. members. The subcommittee would make decisions related to nuclear safety, security and reliability issues.

One watchdog group doesn't believe UniStar will be able to find a U.S. partner.

Michael Mariotte, executive director of Nuclear Information and Resource Service, in Takoma Park, said his group has long warned that EDF's and the French government's dominant role in the project does not pass U.S. nuclear regulations for power plant construction.

"There's probably less than a 5 percent chance at this point it will get built," Mariotte said, noting the recent worldwide concerns about nuclear power after an earthquake and tsunami damaged reactors in Japan. "It's going down fast."

Baltimore Sun staff writers Timothy B. Wheeler and Gus G. Sentementes contributed to this article.

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