Nine Mile Point acquisition marks first for Constellation

2 January 2001

UNITED STATES Constellation Nuclear Corp's announcement that it will acquire the two Nine Mile Point nuclear plants in western New York marks the Baltimore, Maryland, company's first dip into the market for nuclear power stations in the United States. Constellation Nuclear, which currently owns and operates the two PWRs at Calvert Cliffs, Maryland, offered the highest bid during an auction of the Nine Mile Point plants ordered by state regulators. Constellation said it would pay US$815 million for 100% of unit 1 and 82% of unit 2, plus their fuel.

The Nine Mile Point BWRs are currently owned by group of regional utilities that include Niagara Mohawk, New York State Electric & Gas, Central Hudson Gas & Electric. and Rochester Gas & Electric.

Niagara Mohawk said the price for the Nine Mile Point units amounts to US$1.04 billion, when US$134 million in interest and US$88 million in decommissioning savings are added to the US$815 million in cash and payments.

The Long Island Power Authority, which owns 18% of Nine Mile Point 2, did not put its share up for sale. John Reed, executive director of Navigant Consulting, which conducted the auction, called the bidding process "very competitive" but declined to identify the other bidders.

Under terms of the sale, Constellation Nuclear will sell 90% of its share of the Nine Mile Point plants' output back to the sellers for about 10 years at an average price of US$35 per MWh.

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