Florida Power & Light told the Federal Energy Regulatory Commission on Sept. 18 that Cedar Bay Generating Co. LP, the owner of a coal-fired power plant, no longer seeks to retain its Exempt Wholesale Generator (EWG) status.
“On July 2, 2015, the Commission authorized a transaction pursuant to which CBAS Power Holdings, LLC would transfer 100% of its equity interest in the Cedar Bay facility to Florida Power & Light Company (the ‘Transaction’),” said the brief filing. “The Transaction closed on September 18, 2015. Cedar Bay no longer has a need for its EWG status. Accordingly, Cedar Bay hereby notifies the Commission that it no longer seeks to maintain its EWG status.”
The Florida Public Service Commission on Aug. 27 approved FPL’s plan to buy and then quickly shut the coal-fired Cedar Bay power plant. This deal will free FPL customers of the high cost of purchasing power from the Cedar Bay plant under a long-term power purchase deal. Although FPL is expected to pay $520.5 million for the 250-MW plant, purchasing Cedar Bay is more cost effective for customers than continuing the existing purchase power contract, which extends through 2024, the commission decided.
With the plant purchase, FPL will terminate the power contract and its customer costs. FPL also plans to decrease Cedar Bay plant operations by about 90%, thus reducing carbon dioxide emissions, and expects to retire the plant nearly eight years sooner than would have been the case without the purchase.
Other recent events related to this deal include:
- FPL filed on Aug. 19 with FERC an interim power purchase deal that would let it sell power to itself out of Cedar Bay in the limited time the plant will run after this plant purchase deal is completed.
- The members of FERC on July 2 approved this buy. FPL told the commission that CBAS Power Holdings is a subsidiary of The Carlyle Group, a global alternative investment management firm. FPL said that it anticipates dispatching the facility until at least 2016, but at an approximately 5% capacity factor instead of at the current approximately 50% capacity factor. Due to the expected availability of a new interstate natural gas pipeline system to fuel its natural gas-fired units, FPL projects that it will retire the Cedar Bay facility in early 2017.
U.S. Energy Information Administration data shows eastern Kentucky coal producer Nally & Hamilton as the contract supplier to the Cedar Bay plant, under a contract to expire in December of this year.