Calpine (NYSE:CPN) has agreed to acquire the 745-MW Granite Ridge Energy Center from Granite Ridge Holdings, LLC for $500m, or roughly $671 per kilowatt.
The deal is subject to working capital adjustments, Calpine said in an Oct. 13 news release. The combined-cycle, gas-fired power plant is located in Londonderry, New Hampshire, approximately 45 miles northwest of Boston.
Granite Ridge is located in ISO-New England, where tightening market conditions have resulted in capacity revenues that will improve substantially over the next three years, Calpine said.
The power plant, which commenced commercial operation in 2003, features two Siemens 501G combustion turbines, two heat recovery steam generators and one steam turbine.
In 2013, Granite Ridge had a capacity factor of 42.7 %, according to GenerationHub data.
The Granite Ridge project sits on about 48 acres of land and has 27 employees, according to a January 2013 presentation to the Vermont Energy Siting Commission.
Calpine expects to fund the transaction with a combination of debt and cash. The financing plan for the transaction will ultimately be based upon prevailing market conditions. The company has already obtained committed debt financing sufficient to cover the purchase price.
Calpine expects the transaction to close by the first quarter of 2016.
The transaction is subject to the usual closing conditions, antitrust review under the Hart-Scott-Rodino Act and approvals from the Federal Energy Regulatory Commission (FERC), the Federal Communications Commission (FCC) and the New Hampshire Site Evaluation Committee.
The current owners of the plant recently filed an updated interconnection deal with ISO New England. In December 2014, Merrill Lynch Credit Products LLC got approval from FERC to become a 20% stakeholder in the power plant.