With the Friday ruling by the District Court Judge Larry Noll - in a clash between CPS Energy and its partner NRG Energy over the proposed South Texas Project nuclear plant expansion - going in favor of CPS Energy, it will become easier for either partner to withdraw from the project without losing its entire investment.

CPS Energy, the municipal utility serving San Antonio, had sued NRG over the terms of their deal for the construction of a third and fourth reactor, close to the current South Texas Project - a proposal that is yet to receive loan guarantees from the Energy Department.

In its December 7-filed lawsuit, CPS, which has spent $350 million on the project, had sought a clarification from NRG about its rights, in case it decides to withdraw itself from the collapsing nuclear deal.

Prior to the Friday ruling, NRG’s chief executive David Crane told investors that the company would withdraw, and bear an almost $400 million loss, if the nuclear arrangement with CPS stops making financial sense.

Urging the two companies to renegotiate their terms, Noll said in his ruling that either company has a right withdraw from the proposal; and that, as of now, each partner is a
50 percent equity shareholder. Noll added that “no forfeiture of interest exists” as per the terms of the contract.