Dynegy has signed an agreement to divest three US power generation power plants for around $300m.
The company is expected to generate aggregate sales proceeds of around $780m from the sales, including earlier announced LS Power transaction. The proceeds will be used to reduce its debt.
Currently, Dynegy has agreed to divest its 625MW Lee energy facility in the PJM ComEd region to an affiliate of Rockland Capital for around $180m.
The divestment of gas-fueled peaking asset will help the company to generate additional cash proceeds for debt repayment.
Dynegy has also agreed to divest two generating assets to Starwood Energy Group Global for about $119m.
The combined 310MW assets include two intermediate gas-fueled plants situated in Dighton and Milford, Massachusetts.
According to Dynegy, the deal satisfies the mitigation plan approved by the Federal Energy Regulatory Commission (FERC) regarding the firm’s purchase of Engie’s US-based asset portfolio.
Last December, FERC raised competitive concerns with respect to the capacity markets in the ComEd Locational Delivery Area (LDA) in PJM and the Southeastern New England (SENE) capacity zone in ISO-NE.
Dynegy had presented a mitigation plan to solve FERC’s concerns, which asked for a divestment of capacity in SENE within six months of closing.
Both transactions are subject to customary regulatory approvals.
Dynergy operates power generating facilities, which hold a capacity to produce around 28,000MW of electricity.
Last year, Dynegy has announced the shut down of three uneconomical coal-fueled units at two power plants in Illinois, US.
Dynegy announced the shut down of unit one and three at the Baldwin power station, as well as unit two at the Newton power station.
Source: Fossil Fuel