NRG Energy has agreed to sell two of its generating stations: the 525 MW Seward power plant in New Florence, Pennsylvania and the 352 MW Shelby County power plant in Neoga, Illinois.
David Crane, CEO NRG, stated:
“NRG is focused on maintaining a robust presence and balance through conventional generation assets that complement each other in respect to geography, technology and smart fuel diversity. By streamlining our fleet, we can create additional value for our shareholders and meet the needs of our customers with reliable, efficient and economic power. This is part of our ongoing and deliberate strategy of portfolio optimization.”
The Seward facility, which is located in the PJM Interconnection, is being acquired by Seward Generation, LLC, a Robindale Energy Services, Inc. company. As part of the sale agreement, NRG Energy Services will provide operations and maintenance services to the Seward plant on behalf of Robindale Energy using the current NRG workforce.
The Shelby County facility, which is located in the MISO Interconnection, is being acquired by an affiliate of Rockland Capital, LLC. The station is a 352 MW natural gas-fueled, simple-cycle combustion turbine peaking plant with eight General Electric LM6000 aero-derivative combustion units.
Mauricio Gutierrez, COO NRG, commented:
“Operating a diverse generation fleet is a key component of NRG’s continued success in every region in which we operate. As part of our asset optimization initiative, we’ve identified a few specific facilities that would be better suited in other hands in markets where we can transact at good value while avoiding future capital expenditures.”
The aggregate purchase price for the two generation facilities, both of which are owned by GenOn Energy Inc, an excluded project subsidiary of NRG, is approximately US$ 138 million comprised of cash and other consideration. Together, these assets were projected to average US$10.5 million of Adjusted EBITDA annually over the next 3 years and require approximately $17 million in maintenance capital expenditures over the same period1. The transactions are expected to close in the first quarter of 2016, subject to regulatory approvals, including the Federal Energy Regulatory Commission.