Dominion Energy has agreed to sell interests in three merchant electric generation assets for total proceeds of $1.32bn in two separate transactions.
US-based private investment firm Starwood Energy Group Global has signed an agreement to acquire 100% interest in two combined-cycle gas turbine (CCGT) plants totalling 1,708MW from Dominion Energy, for approximately $1.23bn.
The two CCGT plants include a 1,240MW Fairless Power Station (Fairless) located in Pennsylvania, and 468MW Manchester Street Power Station (Manchester), which is located in Rhode Island.
Located 25 miles outside of Philadelphia in Fairless Hills, Pennsylvania, Fairless is a natural gas-fired power plant, which was constructed in 2004.
The Manchester station is located in Providence, Rhode Island, and was repowered as a CCGT in 1995. It dispatches into the Southeast New England (SENE) zone of ISO-New England.
Both plants are said to be located in regional transmission organisations that provide a forward capacity market for electric generation assets.
The completion of the transaction is subject to customary regulatory approvals and is expected to take place by the end of this year. For this transaction, King & Spalding served as legal counsel to Starwood.
Dominion Energy will also sell 25% interest in the Catalyst Old River Hydroelectric Limited Partnership, which owns a 192MW hydroelectric generating station in Louisiana.
The interest in the Catalyst Old River Hydroelectric is being divested for a cash consideration of approximately $90m.
Dominion Energy chairman, president and chief executive officer Thomas F. Farrell, II, said: “We are pleased with these results from our non-core asset sales. The total proceeds exceed the midpoint of our previously issued guidance range of $1.0 to $1.5bn. These actions demonstrate our commitment to the company’s credit profile and represent the successful completion of the credit improvement initiatives that we announced in March.”