The Federal Energy Regulatory Commission on May 15 approved an April 3 application from FortisUS Energy Corp. requesting authorization for a transaction in which a to-be-formed wholly owned subsidiary of a new holding company (New Holdco) affiliated with Energy Ottawa Inc. proposes to purchase all of the outstanding shares of FortisUS, which owns and operates four hydropower qualifying facilities (QFs) in New York.
Although FortisUS stated that the proposed transaction may not require commission approval under Federal Power Act section 203, it nevertheless asked the commission to approve the application. “This order approves the Proposed Transaction without making any determination of jurisdiction,” said FERC’s May 15 ruling.
FortisUS Energy is wholly owned by FortisUS Inc., which in turn is an indirect, wholly owned subsidiary of Fortis Inc. Fortis Inc. is a publicly traded holding company with regulated holdings in electric utilities in five Canadian provinces, Arizona, New York State and two Caribbean countries, and natural gas utilities in British Columbia, Arizona, and New York State.
FortisUS Energy owns four QFs, which comprise approximately 24 MW in the New York Independent System Operator (NYISO) market. All of the output of the four QFs is currently sold under contracts with National Grid, which expire on Dec. 31, 2016. The QFs are:
- The Moose River Project is an approximately 13 MW run-of-the-river project;
- The Philadelphia Project is an approximately 4 MW run-of-the-river facility;
- The Diana Project is an approximately 2 MW run-of-the-river facility; and
- The Dolgeville Project is an approximately 5 MW run-of-the-river hydroelectric facility.
FortisUS states that purchaser will be established as a holding company in the United States and will be the direct owner of the shares of FortisUS. The purchaser is a wholly owned subsidiary of New HoldCo, a company based in Ontario, Canada, which is an affiliate of Energy Ottawa. Energy Ottawa is a diversified energy company, which is based in Ottawa, Canada. Energy Ottawa operates hydroelectric facilities, gas-to-energy generating plants, and it also offers energy management and procurement services. Energy Ottawa directly owns three hydroelectric facilities operated on the Ottawa River in Ottawa, Canada, and through a wholly owned affiliate, Chaudiere Hydro LP, it owns three additional hydroelectric facilities. Energy Ottawa is a wholly owned subsidiary of Hydro Ottawa Holding Inc., which is wholly owned by the City of Ottawa.