Balko Wind companies seek FERC approval for sale of passive equity interests

Balko Wind LLC, Balko Wind Transmission LLC and DESRI VI Balko Wind Holdings LLC applied May 28 at the Federal Energy Regulatory Commission for authorization of the acquisition by BAL Investment & Advisory, Inc. or an affiliate (BALIA Investor), EFS Renewables Holdings LLC (EFS Investor), Flamingo Wind OK LLC (Flamingo Investor) and Citicorp North America (Citi Investor) of passive equity interests in Balko and Balko Transco.

Although the proposed transaction may not require authorization under Federal Power Act Section 203(a)(1) due to the passive interests nature of the interests being transferred and may qualify for the blanket authorization from Section 203(a)(2) for the acquisition of non-voting securities, the applicants said they are filing this application out of an abundance of caution to ensure that all required regulatory approvals have been obtained for this deal.

Balko is developing and will own and operate an approximately 299.7-MW (nameplate) wind facility located in Beaver County, Oklahoma. The facility is interconnected to the electric transmission grid owned by Oklahoma Gas and Electric within the Southwest Power Pool (SPP) balancing authority area (BAA) via a 345-kV, approximately five-mile transmission line. Balko Transco, which is a wholly owned subsidiary of Balko, owns and operates the transmission line. Balko began sales of electric energy for testing purposes on April 24.

Balko is committed to sell the full output of the facility under 20-year power purchase agreements with two non-affiliates: Public Service Co. of Oklahoma (PSCO) and Western Farmers Electric Cooperative (WFEC). The power purchase agreement with WFEC, representing an output of 100 MW of the facility’s approximately 300 MW of capacity, commences at the commercial operation date. The power purchase agreement with PSCO, representing an output of the remaining 200 MW of the facility’s capacity, commences in January 2016.

Balko Transco is a wholly owned subsidiary of Balko, which, in turn, is a wholly owned subsidiary of Balko Holdings. Balko Holdings is ultimately controlled by D. E. Shaw & Co. Inc. (DESCO Inc.). Dr. David E. Shaw is the chairman, president, and sole stockholder of DESCO Inc.

The buyers of these passive interests are:

  • Flamingo Investor is a wholly owned subsidiary of Google Inc., the internet search engine company, and is affiliated with Google Energy LLC, a power marketer that has been authorized to sell energy, capacity, and ancillary services.
  • EFS Investor is a wholly owned subsidiary of Aircraft Services Corp., which itself is a wholly owned subsidiary of General Electric Capital Corp. General Electric Capital is a wholly owned subsidiary of General Electric (NYSE: GE).
  • Citi Investor is a subsidiary of Citigroup Inc., a global financial services company that provides a broad range of financial products and services to consumer and corporate customers.
  • BALIA Investor is an indirect, wholly owned subsidiary of Bank of America Corp. which is a bank holding company and a financial holding company.
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.