PSEG Power, through its wholly-owned subsidiary PSEG Fossil, has acquired the 755-MW Keys Energy Center project in Maryland from Genesis Power LLC and an energy-focused private equity fund managed by Ares EIF Management LLC.
PSEG Power said in a June 17 statement that it plans to rename the facility the PSEG Keys Energy Center (KEC). PSEG Power – an independent power producer and subsidiary of Public Service Enterprise Group (NYSE: PEG) – expects to begin construction of the natural gas-fired, combined-cycle plant in 2015. The plant, which represents an investment of $825 million-$875 million, is targeted to be completed and supplying needed capacity and energy to the state of Maryland and region in 2018. The project was bid into and cleared the PJM Interconnection capacity auction in May 2014.
PSEG Fossil will oversee construction, operate and maintain the plant. SNC-Lavalin Constructors Inc. is the engineering, procurement and construction contractor. The combined-cycle plant will use state-of-the-art generating technology, including a full complement of emissions controls and run on clean, efficient natural gas. The plant will generate approximately 700 jobs during the two-year construction phase. More than 20 permanent jobs will be created to run the new plant once it becomes operational.
“The new plant offers a strong operational and financial fit for PSEG Power’s balanced generation portfolio and will expand our footprint in our core PJM market,” said Bill Levis, PSEG Power president and COO.
“We have extensive experience in developing and running combined-cycle plants,” said Richard P. Lopriore, president of PSEG Fossil. “PSEG Power is committed to working with local government and community organizations to provide employment opportunities for as many qualified workers as possible from the local area.”
Located in Prince George’s County, Maryland, the PSEG Keys Energy Center will feature two gas-fired turbines and one steam turbine. The project is located north of North Keys Road and about 1.25 miles east of Brandywine, Maryland, very near Washington DC.
The plant will connect to the Potomac Electric Power Co./PJM 500 kV transmission line adjacent to the property; no new transmission lines are required. Fuel to run the plant is also readily available; a major interstate natural gas pipeline is within close proximity of the site.
PSEG Power is an independent power producer that generates and sells electricity in the wholesale market, with a fleet totaling more than 13,000 MW. With the addition of the PSEG Keys Energy Center, the combined-cycle gas turbine fleet would grow to represent in excess of 4,000 MW, or approximately one third of the fleet. PSEG Fossil is a subsidiary of PSEG Power, and operates the company’s portfolio of natural gas-, coal- and oil-fired generating units.
Ares Management LP (NYSE: ARES) is a leading global alternative asset manager with approximately $87 billion of assets under management and more than 15 offices in the United States, Europe and Asia as of March 31, 2015. Ares EIF Management LLC, formerly known as Energy Investors Funds (EIF), was acquired by Ares in January 2015. EIF was founded in 1987 as one of the first private equity fund managers focused on the independent power industry.