Brookfield Renewable Energy Partners L.P. has announced an agreement to acquire a hydroelectric portfolio in Pennsylvania from Talen Energy for US$860 million.
Brookfield Renewable will acquire and fund the transaction with institutional partners and maintain an economic interest in the portfolio of approximately 40 percent. A portion of the purchase price will be funded with third party investment grade, non-recourse financing expected to close concurrently with the transaction.
The portfolio consists of two facilities, the 252 MW Holtwood station on the Susquehanna River and the 40 MW Wallenpaupack station on Lake Wallenpaupack in the Pocono Mountains, with a combined expected average annual generation of approximately 1.1 million megawatt hours.
The acquisition provides a strong fit with Brookfield Renewable’s 417 MW Safe Harbor facility located eight miles upstream from Holtwood. All output is currently sold into PJM and the portfolio benefits from a diverse revenue stream including energy, capacity, renewable energy credits and ancillary services.
Both Holtwood and Wallenpaupack have long-term FERC operating licenses through 2030 and 2045, respectively.
Sachin Shah, Chief Executive Officer of Brookfield Renewable, stated:
“These high-quality assets provide a unique opportunity to leverage our operating platform and hydroelectric expertise in a market facing significant coal retirements and increasing reliance on renewables.”
The transaction is subject to regulatory approvals and other customary closing conditions and is expected to close in the first quarter of 2016.