Constellation completes ownership stake in Texas plant
Constellation Energy announced last week that it has completed its acquisition of NRG Energy’s 44 percent ownership stake in the South Texas Project nuclear power plant.
Located in Bay City, Texas, about 90 miles southwest of Houston, the South Texas Project is a two-unit, 2,501-MWe pressurized water reactor facility. (The 44 percent interest represents about 1,100 MWe.) Unit 1 entered commercial operation in August 1988 and Unit 2 in June 1989, making them among the youngest reactors in the U.S. fleet.
The plant will continue to be operated by STP Nuclear Operating Company, Constellation said.
Done deal? The $1.75 billion transaction, announced in June of last year, was opposed from the start by the plant’s co-owners, Austin Energy and CPS Energy—Texas municipal utilities holding ownership stakes of 16 percent and 40 percent, respectively. Both are currently in litigation over the matter. In addition, in July 2022, Austin and CPS filed a motion with the Nuclear Regulatory Commission to dismiss the license transfer application. Nevertheless, the NRC last Monday approved the license transfer of the reactors’ licenses and the associated spent fuel storage facility, adding the following caveat: “There is a hearing request currently pending before the commission. The transfer approval is subject to the commission’s authority to rescind, modify, or condition the transfer based on the outcome of any subsequent hearing on the application.”
In its announcement, Constellation said that it “is working to reach a favorable resolution for all parties in the related litigation pending in Matagorda County, Texas.”
Official words: “Growing our fleet of the nation’s best-run nuclear plants is at the heart of our growth strategy,” said Joe Dominguez, Constellation’s president and chief executive officer. “As the world is waking up to the immense value of nuclear power to address the climate crisis and maintain energy security, Constellation will continue to look for opportunities to expand our ownership of assets like STP. We look forward to working with our new co-owners and the plant’s team members to provide reliable, clean, and affordable energy, as well as economic benefits to the people of Texas.”
In a separate statement from NRG, president and CEO Mauricio Gutierrez said, “Completion of the sale is an important step in creating shareholder value through optimizing our diversified power supply portfolio. This transaction will release significant capital to fund our current share repurchase and debt reduction programs.”
