Energy Choice
                            

Matters

Archive

Daily Email

Events

 

 

 

About/Contact

Search

NRG Announces Asset Sales Providing $2.8 Billion In Cash Proceeds, Including Texas Generating Plant

February 7, 2018

Email This Story
Copyright 2010-17 EnergyChoiceMatters.com
Reporting by Paul Ring • ring@energychoicematters.com

NRG Energy, Inc. and Global Infrastructure Partners (GIP) have entered into a Purchase Agreement for GIP to purchase NRG's ownership in NRG Yield and NRG's Renewables Platform for cash proceeds of $1.375 billion, subject to certain adjustments.

Separately, NRG and Cleco Corporate Holdings LLC (Cleco) entered into a Purchase and Sale Agreement for Cleco to purchase NRG's South Central business for a total purchase price and cash proceeds of $1.0 billion, subject to certain adjustments.

NRG said the transactions collectively will result in $2.8 billion cash proceeds (excludes transaction costs; subject to working capital and other customary purchase price adjustments), and will result in $7.0 billion of debt being removed (debt as of 9/30/17)

Renewables Sale

The GIP purchase and sale agreement includes the sale of NRG's ownership in NRG Yield's Class B and Class D shares, NRG's renewable energy development and operations platforms, NRG's renewable energy non-ROFO (Right of First Offer) backlog and pipeline, and the NRG ROFO updated pipeline, with the exception of four assets which are addressed in separate agreements as further detailed below.

"The sale of NRG's Renewables Platform and NRG's interest in NRG Yield does not impact NRG's commitment to provide comprehensive energy solutions for corporate and residential customers," NRG said

The GIP transaction is expected to close in the second half of the year and is subject to various customary closing conditions, approvals and consents, including: Federal Energy Regulatory Commission (FERC); California Public Utility Commission (CPUC); Connecticut Public Utilities Regulatory Authority (CT PURA); Department of Energy (DOE); Pennsylvania Public Utilities Authority (PAPUC); and antitrust review under Hart-Scott-Rodino. The transaction is not subject to shareholder approval.

NRG's renewable assets and development pipeline sold under the process includes 0.5 GW In-Operation and 6.4 GW in Backlog and Pipeline

Additionally, NRG and NRG Yield entered into Purchase and Sale Agreements for NRG Yield to purchase NRG's interest in the following ROFO pipeline assets: 527 MW Carlsbad Energy Center and 154 MW Buckthorn Solar for additional cash proceeds of $407 million, subject to certain adjustments. As noted, GIP will acquire NRG's interest in NRG Yield

The Carlsbad Energy Center and Buckthorn Solar drop downs are expected to close before year-end and are subject to both projects achieving commercial operations status as well as various customary closing conditions and approvals.

As part of the sale of NRG's interest in NRG Yield, NRG and NRG Yield agreed to maintain a ROFO agreement for NRG's remaining 102 net MW ownership in Agua Caliente, and also amended the ROFO agreement to remove Ivanpah as a ROFO asset.

South Central Sale

The South Central business, to be sold in its entirety to Cleco, owns and operates a 3,555 MW portfolio of generation assets consisting of 225 MW Bayou Cove, 430 MW Big Cajun-I, 1,461 MW Big Cajun-II, 1,263 MW Cottonwood and 176 MW Sterlington, and serves a customer base of cooperatives, municipalities and regional utilities under load contracts.

Notably, the Cottonwood plant is located in East Texas, though it is located in MISO, not ERCOT

As part of the transaction, NRG is entering into a sale leaseback agreement for its 1,263 MW Cottonwood plant, a CCGT natural gas-fired combined cycle plant, through May 2025.

The Cleco transaction is expected to close in the second half of the year and is subject to various customary closing conditions, approvals and consents; including: Federal Energy Regulatory Commission (FERC); Louisiana Public Service Commission (LPSC); Committee on Foreign Investment in the United States (CFIUS); and antitrust review under Hart-Scott-Rodino.

NRG Revises Asset Sale Cash Proceeds Target

Today's announcement brings NRG's cumulative Transformation Plan asset sales to $2.9 billion in anticipated cash proceeds, including approximately $150 million of asset monetization closed in the second half of 2017. NRG expects to announce additional asset sales over the course of 2018 and is revising its total asset sales cash proceeds target to approximately $3.2 billion

ADVERTISEMENT
NEW Jobs on RetailEnergyJobs.com:
NEW! -- Business Development Manager - Texas, Retail Provider
NEW! -- Business Development Manager - Northeastern US, Retail Supplier
NEW! -- Senior or Principal Quantitative Research Analyst, Energy Commodity/Risk
NEW! -- Operations Manager -- Retail Supplier
NEW! -- Business Development Manager -- Retail Supplier -- Philadelphia
Commercial Energy Advisor -- Dallas
Analyst Billing and Transaction Services, Retail Operations -- Retail Provider -- Houston

Email This Story

HOME

Copyright 2010-16 Energy Choice Matters.  If you wish to share this story, please email or post the website link; unauthorized copying, retransmission, or republication prohibited.

 

Archive

Daily Email

Events

 

 

 

About/Contact

Search