Exhibit 3

STATE OF CONNECTICUT

DEPARTMENT OF ENVIRONMENTAL PROTECTION

STATE OF CONNECTICUT

AND

TRADING AGREElVlENT AND

ORDER NO. 8107

MODIFICATION NO.2

NORTHEAST NUCLEAR

ENERGY COMPANY

TRADING AGREElVlENT AND ORDER MODIFICATION

In the maner of a Trading Agreement and Order between the Commissioner of Environmental

Protection ("Commissioner") and Northeast Nuclear Energy Comp'!O¥ ("NNECO").

WHEREAS, the Commissioner and NNECO, having agreed to the terms and conditions set

forth in Trading Agreement and Order No. 8107 issued on October 13, 1995, and Trading

Agreement and Order No. 8107 Modification issued on April 29, 1999, do now, by mutual

agreement, modify said Trading Agreements and Orders as follows:

1. Delete paragraph A.2. and substitute the following therefor:

At the facility, NNECO operates five (5) oil-fired heating boilers ("boilers"),

numbered CBI, CB2, CB3, B&WI, andB&W2.

2. Delete paragraph A.3. and substitute the following therefor:

The boilers are subject to Section 22a-174-22 of the Regulations of Connecticut

State Agencies ("Regulations"). On and after May 31,1995, Section 22a-174-

22(e) of the Regulations requires that the boilers emit nitrogen. oxides ("NOx") at

a rate no greater than 0.25 pounds per million British thermal. units

("lbslMMBtu") of heat input.

3. Add paragraph AA. as follows:

Stack testing conducted in March and April of 1995 showed that boilers numbered

CBI, CB2, CB3, and B&W2 exceeded the allowable NOx emission rate. Stack

testing conducted in March of 2000 showed that all five boilers exceeded the

allowable NOx emission rate.

Date:

(Pril1ted 011 Recycled Paper)

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NORTHEAST NUCLEAR

ENERGY COMPANY

2 TRADING AGREEMENT AND ORDER

MODIFICATION NO.2

4. Add paragraph AS as follows:

Pursuant to Section 22a-174-22U) of me Regulations, NNECO will acquire

approved emission reduction credits (<<ERCs") to offset excess NOx emissions

from the boilers. Approved ERCs are defined for purposes of this order as those

for which the Commissioner has provided written authorization for use in

compliance with Section 22a-174-22 of the Regulations.

5. Add paragraph A.6. as follows:

From January Urrough April, 1997, NNECO did not qave sufficient ERCs on

hand to cover excess NOx emi.ssions from boilers num~red CBI, CE2, CB3,

and B&W2. Excess NOx emissions during said time period were 3.2 tons.

6. Add paragraph A.7. as follows:

NNECO has adjusted the 3.2 tons of ERCs required in paragraph A.6. upwards by

100% and retired the required ERCs (6.4 tons) on April 23, 1997.

7. Delete paragraph C.l. and substitute the following therefor:

On and after May 31,1995 for boilers numbered CB1, CB2, CB3, andB&W2,

and on and after April 12, 2000 for boiler numbered B&Wl ,NNECO shall have

in its possession approved ERes for the boilers; shall document and record the

amounts of all fuel and approved ERCs used by each boiler each month; shall

maintain and provide such records in accordance with the following and Section

22a-174-4 of the Regulations, until May I, 2003; and:

a. Before the first day of each month, calculate projected ERCs required for

the boilers for the nex.t calendar month as follows:

ERCs (tons) ; (Estimated Fuel Use in MMBTU X (FLER(lbIMMBTU) -

[.95 x .25 IblMMBTU]))!2000 pounds

Where FLER means full load emission rate referenced in paragraph C.2.;

Initials:

b. Except as otherwise specified in subparagraphs C.3. and C.4., NNECO

shall have in their possession sufficient approved £RCs no later that the

first of each calendar month to assure compliance for, at a minimum, that

/'-..--, c.... Date: .11..='2.",,".l..:\ 0-,-\__
NORTHEAST NUCLEAR

ENERGY COMPANY

3 TRADING AGREEMENT AND ORDER

MODIFICATION NO.2

c.

d.

e.

f.

g.

h.

I.

k.

. Initials:

month. Excess credits from previous months can be applied to subsequent

months. Approved ERCs shall be acquired for the period beginning May

31,1995 for boilers numbered CBI, CB2, CB3 and B&W2, and April 12,

2000 for boiler numbered B&Wl, and until NNECO achieves permanent

compliance with the emission standard in Section 22a-174-22(e) of the

Regulations;

No later than the tenth day of each month, calculate approved ERes used

in [he preceding calendar month;

Document and record monthly fuel used by each boiler and the approved

ERCs used;

No later than March 1, 1999 and on March I, thereafter until 2004, include

with its annual emissions report to the Commi;Sio'ner, the fuel consumed

and approved ERCs used monthly for the previous calendar year;

Retain records and supporting documentation as described in this section

for a minimum of five years, commencing on the date such records were

created;

Maintain documentation to attest to the fact that approved ERCs used

during the ozone season were generated during the ozone season. The

ozone season is May I to September 30 in any calendar year. Generator

certification of this fact shall be sufficient;

Provide the records specified above to the Commissioner within thirty (30)

days of receipt of a written request from the Commissioner; .- !

Notwithstanding paragraph c.I.a.; ERCs requirecl shaJl be adjusted

upwards by at least 100% if ERCs are not in NNECO's possession prior to

use;

NNECO shall notify the Commissioner in writing, within thirty (30) days

from the date of discovery of any deficit in ERCs, and shall submit copies

of supporting calculations for review and approval by the Commissioner;

and

NOlhing in this Trading Agreement and Order shall prOhibit the

Commissioner from imposing additional premiums or taking additional

enforcement action that the Commissioner deems appropriate.

Date;~
NORTHEAST NUCLEAR

ENERGY COMPANY

4 TRADING AGREEMENT AND ORDER

MODIfICATION NO.2

8. Delete paragraph C.2. and substitute the following therefor:

From May 31,1995 to May I, 2003, for boilers numbered CBl, CB2, CB3 and

B&W2, and from April 12,2000 to May 1,2003 for boiler numbered B&WI,

NNECO, during operation of each boiler, shall not exceed the FLERs shown in

Table 1 below.

Table I

FLERs and NOx Emission Rates

UNIT RIEL FLER rate FLER rate 2000 Stack RACf rate

(lblMMBtu) (lblMMBtu) test rate limits

prior to 2000 On and after (lplMMBtu) (lbIMMBtu) . stack test 2000 Slack test

30iler CBl No.4 oil 0.33 0.42 0.38 0.25

30iler CB2 No.40il 0.33 0.39 0.35 0.25

30iler CB3 No.40il 0.33 0.35 0.32 0.25

Joiler B&WI No.40il N/A 0.29 0.26 0.25

JoilerB&W2 No.4 oil 0.26 0.35 0.32 0.25

All other tenns and conditions of Trading Agreement and Order no. 8107 issued by the

Commissioner acting under Chapter 446c. Sections 22a-6. 22a-171, 22a-174, 22a-176. and 22a177 of the Connecticut General Statutes shall remain in effect.

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Initials: ~\(
NORTHEAST NUCLEAR

ENERGY COMPANY

5 TRADING AGREEMENT AND ORDER

MODIFICATION NO.2

Northeast Nuclear Energy Company hereby consents to the entry of this modification to the

Trading Agreement and Order without further notice.

Northeast Nuclear Energy Company

Signature: _r:e---..0:::.~\.~~~'O:,=::~==---__

Type Name:

Type Title:

Frank C. Rothen

VP--Nuclear work Services

Date: -_'='.I="-L=---:7"'~--

Entered as a modificatio'!.2!.iP Order of the Cr~s~ner of En

numbered 8107 this Z""" day of 2

Arthur J. Rocque,

Commissioner

TOWN OF WATERFORD

LAND RECORDS

MA.ILED CERTIFIED MAIL,

RETURN RECEIPT REQUESTED

Certified Document No.