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September 14, 2016updated 07 Nov 2021 11:59am

American Electric Power to sell four power plants to Blackstone and ArcLight JV

Major investor-owned electric utility US American Electric Power (AEP) has signed an agreement to sell four plants totaling approximately 5,200MW for around $2.17bn.

Major investor-owned electric utility US American Electric Power (AEP) has signed an agreement to sell four plants totaling approximately 5,200MW for around $2.17bn.

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A newly formed joint venture (JV) of Blackstone and ArcLight Capital Partners purchased the plants, which include the 1,186MW natural gas-powered Lawrenceburg Generating Station in Lawrenceburg in Indiana, a 840MW natural gas-powered Waterford Energy Center in Waterford in Ohio, a 507MW natural gas-powered Darby Generating Station in Mount Sterling in Ohio, and 2,665MW coal-powered Gen. James M. Gavin Plant in Cheshire, Ohio.

AEP’s chairman, president, and chief executive officer Nicholas Akins said: “AEP’s long-term strategy has been to become a fully regulated, premium energy company focused on investment in infrastructure and the energy innovations that our customers want and need.

“This transaction advances that strategy and reduces some of the business risks associated with operating competitive generating assets.”

“We are working closely with the Blackstone and ArcLight teams to obtain the regulatory approvals necessary to complete the sale.”

“Our employees have done an incredible job operating these power plants in PJM, and I’m confident that they will contribute to the future success of Blackstone and ArcLight.

“We will continue to operate these plants safely in the coming months while working closely with the Blackstone and ArcLight teams to obtain the regulatory approvals necessary to complete the sale. We also will be working with employees and community leaders to ensure a smooth transition.”

Located in the region served by PJM Interconnection, the sale is subject to regulatory approvals from the Federal Energy Regulatory Commission, the Indiana Utility Regulatory Commission, and federal clearance pursuant to the Hart-Scott-Rodino Antitrust Improvements Act of 1976.

It is expected to close in the Q1 of next year and AEP expects to net approximately $1.2bn in cash after taxes, repayment of debt, and transaction fees.

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Free Report
img

Battery energy storage will be the key to energy transition – find out how

The market for battery energy storage is estimated to grow to $10.84bn in 2026. The fall in battery technology prices and the increasing need for grid stability are just two reasons GlobalData have predicted for this growth, with the integration of renewable power holding significant sway over the power market. Over the last decade, various new digital and smart technologies have been integrated, with countries aggressively promoting the modernization of grids, enhancing the grids’ capability to meet present and future requirements. As part of the effort, batteries are being deployed for a wide range of uses. A few such uses include aiding smart grids, integrating renewables, and creating responsive electricity markets. Read this report for expert insights into:
  • Market size and growth
  • Key drivers and restraints
  • Regional trends
  • The impact of the commodity price increase on the battery prices
Get ahead of this growing market and win big by utilizing our report.
by GlobalData
Enter your details here to receive your free Report.

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