Pio Pico targets September 2016 commercial start for 313-MW project

Pio Pico Energy Center LLC on Feb. 4 filed a notice of self certification as an exempt wholesale generator with the Federal Energy Regulatory Commission based on its ownership and operation of a to-be constructed, 313 MW gas-fired simple-cycle facility located in Otay Mesa, an unincorporated area of San Diego County, California.

EIF Pio Pico LLC was formed in 2011 to own Pio Pico, which was formed in 2009 to develop, construct, own, and operate the facility. EIF Pio Pico Holdings LLC is the sole member of EIF Pio Pico. United States Power Fund III LP (USPF III) is the sole member of EIF Pio Pico Holdings. Ares EIF Management LLC (formerly known as EIF Management LLC) manages the assets of USPF III, along with the assets of other private equity funds, which invest in power and other infrastructure assets.

The Pio Pico facility has an expected commercial operation date of around Sept. 30, 2016. The facility will be interconnected with San Diego Gas & Electric (SDG&E), whose transmission system is operated by the California Independent System Operator. Pio Pico will sell at wholesale electric energy and capacity produced from the facility exclusively at wholesale.

Pio Pico said that in 2011 it entered into a 20-year Power Purchase Tolling Agreement (PPTA), as amended, with SDG&E for approximately 304.8 MW of electric capacity. Among other things, the amendments adjust certain milestone dates and postpone the expected initial delivery date for delivery of capacity and energy generated by the facility. The PPTA provides for an Expected Initial Delivery Date of June 1, 2017, and an increase in the length of the PPTA to 25 years (called the “Delivery Period”). Prior to the Delivery Period, for about eight months, the facility’s output will be uncontracted and sold and marketed in the wholesale energy and capacity markets. During the Pre-PPTA Period, Pio Pico will procure the fuel necessary for operations. During the Delivery Period, SDG&E has agreed to provide the natural gas required as fuel to operate the facility and has agreed to purchase all of the electric capacity and energy generated by the Facility and associated ancillary services and environmental attributes.

In a future filing, Pio Pico said it will apply to the commission for market-based rate authority and associated waivers and blanket authorizations.

A company contact is: Mohan P. Thomas Esq., EIF Pio Pico Holdings LLC c/o Ares EIF Management LLC, Three Charles River Place, 63 Kendrick Street, Needham, MA 02494, (781) 292-7014, mpthomas@aresmgmt.com.

About Barry Cassell 20414 Articles
Barry Cassell is Chief Analyst for GenerationHub covering coal and emission controls issues, projects and policy. He has covered the coal and power generation industry for more than 24 years, beginning in November 2011 at GenerationHub and prior to that as editor of SNL Energy’s Coal Report. He was formerly with Coal Outlook for 15 years as the publication’s editor and contributing writer, and prior to that he was editor of Coal & Synfuels Technology and associate editor of The Energy Report. He has a bachelor’s degree from Central Michigan University.