Louisiana-based Cleco has sought and been awarded a $411m depreciation order from the Internal Revenue Service for the company’s Madison Unit 3.
The development was reported in a Jan. 4 8-K filing with the U.S. Securities and Exchange Commission (SEC).
As previously reported in a September SEC filing, Cleco and its Cleco Power unit filed a private letter ruling (PLR) request with the IRS.
The request was filed “in order to determine the appropriateness and timing of the special allowance for depreciation for the Madison Unit 3 Generating Station. Subsequently, on December 28, 2012, Cleco received a favorable PLR from the IRS, consistent with the request allowing for the additional first year depreciation deduction in the amount of $411 million as reflected on Cleco Corporation’s 2011 federal income tax return,” the company said.
“We filed a PLR request to eliminate uncertainty related to this deduction on the tax return,” a Cleco spokesperson said Jan. 8.
According to a Cleco website, Madison 3 is a 600-MW unit fueled by petroleum coke. The circulating fluidized combustion (CFB) plant is also capable of burning biomass as a fuel.
It entered operation in February 2010. The $1bn plant was built at the Brame energy center near Boyce, La.