Adding to its gas-fired power portfolio, Calpine Corp. (NYSE: CPN) said Oct. 4 that it has agreed to purchase an 800-MW power plant owned by Bosque Power Co. LLC, for $432m plus adjustments, or approximately $540 per kilowatt.
The natural gas-fired, combined-cycle plant is located in Central Texas near the unincorporated community of Laguna Park in Bosque County.
“Bosque is a modern combined-cycle plant making it a good fit for our clean, efficient fleet while increasing our presence in ERCOT’s north zone consistent with our strategy to boost capacity in Texas as electric demand rises and reserve margins tighten,” said Calpine President and CEO Jack Fusco. “The Bosque acquisition presents a great opportunity for Calpine to add generation capacity at an important time in the evolution of one of our core markets and at a discount to replacement cost.”
At the time of the purchase, Calpine will change the name of the merchant plant to the Calpine Bosque Energy Center. The 280-acre site includes two generation blocks. One is a 250-MW block with one natural-gas turbine, one heat-recovery steam generator and one steam turbine that achieved commercial operations in June 2001. The other is a 550-MW block with two natural-gas turbines that went online in June 2000 as well as two heat-recovery steam generators and one steam turbine that achieved commercial operations in June 2011.
Calpine said it is targeting a transaction close in early November and expects to fund the acquisition with cash on hand. The transaction is subject to customary closing conditions and expiration of the waiting period under the Hart-Scott-Rodino Act. No shareholder approval is required.
Calpine is already the largest independent power producer in the U.S., with a fleet of 93 power plants representing more than 28,000 MW of generation capacity. Its 91 operating plants as well as two under construction consist primarily of natural gas-fired and renewable geothermal power plants that use advanced technologies to generate power in a low-carbon and environmentally responsible manner.