EDF and Constellation Energy in US EPR alliance

26 July 2007

Electricité de France (EdF) and US energy company Constellation Energy are to create a 50/50 joint venture to develop, own and operate a fleet of new nuclear power plants in the USA and Canada based on the Areva US Evolutionary Power Reactor (US EPR) design.

Under the terms of the agreement, EdF will make an initial investment of $350 million into the joint-venture, UniStar Nuclear Energy, followed by subsequent contributions of up to $275 million upon reaching certain milestones, including $175 million related to the filing of construction and operating license applications at existing Constellation Energy nuclear sites. In exchange, Constellation Energy plans to contribute its shareholding in UniStar Nuclear and to develop up to four standardised EPR nuclear plants on the existing Constellation nuclear sites - Calvert Cliffs in southern Maryland, and Nine Mile Point and R.E. Ginna in upstate New York. Constellation Energy and EdF will each own a 50% interest in UniStar.

In addition, EdF may acquire up to 9.9% of outstanding Constellation shares in the open market, 5% of which can be acquired in the first year of the agreement.

Mayo A. Shattuck III, chairman, president and chief executive officer of Constellation Energy said: “Constellation Energy strongly believes nuclear power must play a prominent role in our nation's energy future, which will be vitally important in helping America achieve its goals of reducing greenhouse gas emissions and moving toward greater energy independence,” but added: “Many milestones lie ahead since we've yet to make a commitment to build.”

An eight-member board will be established with equal representation from both companies and chaired by a representative from Constellation Energy.

Areva welcomed the move and will continue to market the technology through the UniStar Nuclear business model jointly developed by Constellation and Areva and established in 2005. The EPR is a 1,600 MW pressurised water reactor design and is the only Generation III+ design that is currently being built.

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