Newark Energy Center LLC (NEC), EIF Newark LLC and other related companies on Sept. 22 notified the Federal Energy Regulatory Commission of a non-material change in status as a result of the pending achievement of commercial operation (COD) following the undertaking of interconnection equipment testing by NEC’s approximately 755-MW natural gas-fired facility.
COD is expected shortly after the submission of this Sept. 22 notice. The achievement of COD of the NEC Facility does not affect the findings upon which the commission relied in 2014 in granting market-based rate (MBR) authority to each of the companies filing this notice. The commission already found that the addition of NEC’s capacity does not cause any market power issues in the relevant markets, the notice said.
NEC owns and operates an approximately 755 MW (nameplate) natural gas-fired combined cycle electric facility located in Newark, New Jersey. The facility is interconnected to the transmission system owned by Public Service Gas & Electric and operated by PJM Interconnection. The NEC Facility is located in the PJM East, AP South, and 5004/5005 submarkets of the PJM balancing authority area (BAA).
NEC is an exempt wholesale generator under the Public Utility Holding Company Act of 2005. All of the output of the NEC Facility will be sold at wholesale pursuant to NEC’s MBR authority. NEC’s affiliate, EIF Newark, may take title to and sell certain capacity form the NEC Facility at wholesale in the PJM capacity market.
NEC is wholly-owned by EIF-NEC LLC, which is wholly-owned by EIF-NEC Holdings LLC (EIF-NEC Holdings). EIF-NEC Holdings is wholly-owned by funds managed and controlled exclusively by Ares EIF Management LLC (EIF). Through certain entities it controls, EIF is the sole manager of certain private equity investment funds that invest in power projects in the United States. Ares Holdings LP indirectly holds 100% of the voting or equivalent membership interests in EIF.
The notice added: “There has been no change to the Notice Parties’ reportable capacity since NEC’s MBR Application, except for EIF’s divestiture of 30 MW in the PJM BAA (EIF sold all of its interests in Allegheny Hydro No. 8 and Allegheny Hydro No. 9) as well as the reduction of RC Cape May’s name plate rating due to the retirement of Unit 1. RC Cape May (PJM, PJM East, AP South and 5004/5005) now has a reportable nameplate capacity of 323 MW instead of the 475.6 MW reported in the NEC MBR Application. Therefore, the results of the screens included in the NEC MBR Application conservatively overstate the Notice Parties’ presence in PJM (by approximately 183 MW) and the relevant submarkets (by approximately 153 MW). The Notice Parties still pass the pivotal supplier screen and wholesale power market share screen in all of the relevant markets.”