Duke Energy to sell 11 coal, natural gas power plants to Dynegy

Sponsored by

Duke Energy said Dynegy will buy its non-regulated Midwest Commercial Generation Business for $2.8 billion in cash, which includes ownership interests in 11 power plants and Duke Energy Retail Sales, the company's competitive retail business in Ohio.

"This transaction is an important milestone in our strategy to exit the merchant generation business," said Marc Manly, president of Duke Energy's Commercial Businesses. "In the coming months, we will continue to safely operate these plants and work closely with Dynegy to obtain the regulatory approvals necessary to close the transaction. We will also be working with employees and community leaders to ensure a smooth transition for all stakeholders."

The completion of the transaction is conditioned on approval from the Federal Energy Regulatory Commission, the expiration of the waiting period under the Hart-Scott Rodino Act, and the release of certain credit support obligations. Closing is expected to occur in three to six months.

The Midwest generation business includes 11 merchant power plants with a capacity of about 6,100 MW. The power plants are dispatched into the PJM wholesale power market and equipped with environmental controls. The plants are fully owned or partially-owned by Duke Energy Ohio and reported in the company's Commercial Power business unit.

Nine of the power plants are located in Ohio, one is in Illinois and one in Pennsylvania. Dayton Power & Light and American Electric Power's ownership interest in some of the power plants is not included in this transaction.

As a result of this announcement, in the third quarter Duke Energy will recognize an approximate $500 million pre-tax reversal of the $1.4 billion impairment previously recognized in 2014. Use of the proceeds is being evaluated. The transaction is expected to be accretive to shareholders by 2016.

The Duke Energy Ohio and Kentucky and Duke Energy Indiana regulated utilities are not a part of the transaction.

The company began the process to exit its Midwest Commercial Generation Business in February 2014.

Duke Energy's financial advisors are Citigroup and Morgan Stanley. Bracewell & Giuliani is the company's legal advisor.

The following is an alphabetical listing of the 11 power plants being sold.

·      Conesville Station (coal), located in Conesville, Ohio. Partially owned by DP&L and AEP.

·      Dicks Creek (natural gas), located in Middletown, Ohio. Wholly Duke owned.

·      Fayette Energy Facility (natural gas), located in Masontown, Pa. Wholly Duke owned.

·      Hanging Rock Energy Facility (natural gas), located in Ironton, Ohio. Wholly Duke owned.

·      Killen Station (coal), located in Wrightsville, Ohio. Partially owned by DP&L.

·      Lee Energy Facility (natural gas), located in Dixon, Ill. Wholly Duke owned.

·      Miami Fort Station (coal) Units 7 & 8, located in North Bend, Ohio. Partially owned by DP&L.

·      Miami Fort Station (oil), located in North Bend, Ohio. Wholly Duke owned.

·      Stuart Station (coal), located in Aberdeen, Ohio. Partially owned by DP&L and AEP.

·      Washington Energy Facility (natural gas), located in Beverly, Ohio. Wholly Duke owned.

·      Zimmer Generating Station (coal), located in Moscow, Ohio. Partially owned by DP&L and AEP.

Sponsored by

Most Popular Articles


CURRENT MAGAZINE ISSUE

June 2014
Volume 18, Issue 6
file

Utility Products Topics

Transmission & Distribution
                       Vehicles & Accessories
Tools & Supplies   Safety
Line Construction & Maintenance   Test & Measurement

WHITE PAPERS

There is no current content available.

WEBCASTS

There is no current content available.

UTILITY PRODUCTS BUYERS' GUIDE

POWER INDUSTRY JOBS

Industry Company Pages

Keep up-to-date with the latest news and articles from some of the prominent utility product companies and resources.

BUYER'S GUIDE PRODUCTS

Meter Socket Jumpers - Perfect for Submetering Applications

AEP’s Meter Socket Jumper offers a safe and easy means of bypassing a meter socket. The Socket Jumper can be used with either Ringless or Ring style Meters.

Meter Socket Converter

AE Product’s Meter Socket Converter (CNV) converts various Meter Forms to fit the desired application. 14S, 15S or 16S Socket to accept 2S Meter. Optional features available.

Service Disconnect Adapter with Electronic Meter Energizing

AEP’s Service Disconnect Adapter disconnects customer load but maintains power to the electronic meter. The meter maintains reading and communications links for AMR/AMI operations while only disabling the load side.