The Federal Energy Regulatory Commission on Oct. 29 approved the purchase by Nevada Power of the Sun Peak power plant in Las Vegas.
On May 2, Nevada Power and Nevada Sun-Peak Limited Partnership filed an application for the disposition by Sun Peak and acquisition by Nevada Power of the Sun Peak dual-fuel simple cycle peaking plant (Sun Peak Generating Unit).
Nevada Power is a wholly owned subsidiary of NV Energy, which also owns Sierra Pacific Power. NV Energy is a subsidiary of Berkshire Hathaway Energy.
Sun Peak is an indirect subsidiary of ArcLight Energy Partners Fund III LP and ArcLight Energy Partners Fund IV LP, both of which are private equity investment funds managed by ArcLight Capital Partners LLC.
Sun Peak owns and operates the Sun Peak Generating Unit and is an exempt wholesale generator under the Public Utility Holding Company Act of 2005. Sun Peak sells all of the capacity and associated energy output form the Sun Peak Generating Unit to Nevada Power under a long-term fixed rate power supply contract.
The Sun Peak Generating Unit is a 222 MW dual-fired simple cycle plant located in Las Vegas. It is interconnected to Nevada Power’s transmission system and sells 100% of its capacity pursuant to the terms of a long term power purchase agreement set to expire May 31, 2016. Nevada Power has the right to purchase the asset upon the expiration of the term of the Power Purchase Agreement. Nevada Power has designated the Sun Peak Generating Unit as a designated network resource and utilizes the capacity from the unit to meet native load obligations which Nevada Power will continue to do following the closing of this transaction.
This transaction is part of an Emissions Reduction and Capacity Replacement Plan to comply with the requirements of Nevada Senate Bill 123. Nevada Senate Bill 123 includes a schedule for retiring or eliminating at least 800 MW of coal-fired capacity by Dec. 31, 2019, 300 MW of which must be retired by Dec. 1, 2014, and an additional 250 MW must be retired by Dec. 31, 2017. The bill calls for construction, acquisition or contracting for 350 MW of capacity from renewable energy facilities, and also the construction or acquisition of about 550 MW from other electric generating plants.
Nevada Power on May 2 filed with the Nevada Public Utilities Commission its latest plans to comply with this legislative mandate to reduce its coal-fired generation. Under the plan, the company will: retire the coal-fired Reid Gardner Units 1-3 (300 MW) by the end of 2014; retire Reid Gardner Unit 4 (257 MW) by the end of 2017; and eliminate its 11.3% stake (255 MW) in the Navajo coal plant by December 2019.
The utility is lining up this company-owned replacement capacity:
- Las Vegas Cogeneration combined-cycle Unit 2, add by January 2015, 224 MW, gas-fired intermediate capacity;
- Sun-Peak Generating simple-cycle Units 1-3, add by June 2016, 222 MW, gas-fired peaking;
- Moapa Solar, add by October 2016, 76 MW, intermittent solar capacity;
- Las Vegas Cogeneration combined-cycle Unit 1, add by October 2017, 50 MW, gas-fired peaker.