Duke Energy Florida LLC applied Feb. 10 at the Federal Energy Regulatory Commission for all necessary authorizations and approvals for an asset transfer whereby it will acquire Georgia Power’s ownership interest in Intercession City Unit P11 (“IC Unit P11”), an approximately 143 MW (summer rating) distillate fuel oil-fired combustion turbine unit.
In addition, the transaction includes Duke Energy Florida’s purchase and the transfer of Georgia Power’s ownership interest in certain associated assets, namely jurisdictional interconnection facilities and IC Unit P11-related materials and supplies.
Georgia Power presently owns an undivided one-third interest in the facility pursuant to which it is entitled to all of the electrical output of IC Unit P11 during the summer months of June through August and the shoulder month of September. Duke Energy Florida currently owns the remaining undivided two-thirds interest in the facility, and is entitled to all of the electrical output generated by it during the eight other months of the year (October of one year through May of the next year).
Duke Energy Florida asked that the commission issue an order granting this application by July 31.
This transaction is the result of Georgia Power’s exercise of its contractual option to terminate the Amended and Restated Intercession City Siemens Unit Transmission Service Agreement (TSA) between Duke Energy Florida and Georgia Power, which is a FERC-filed agreement providing for transmission service over Duke Energy Florida’s transmission system from the co-owned facility to Georgia Power’s service territory. That option requires Duke Energy Florida to buy Georgia Power’s ownership interest in the facility for net book value.
The commission issued a letter order in August 2015 accepting the termination of the Intercession TSA effective May 21, 2015, and acknowledging the notice of Georgia Power’s exercise of its option.
The transaction involves the acquisition of Georgia Power’s co-ownership interest in a single oil-fired combustion turbine unit. IC Unit P11 is one of fourteen combustion turbine units located at the Intercession City Station, which is a 984-MW (summer rating) facility located in Osceola, Florida. Some of the Intercession City units use natural gas as their primary fuel, while others use distillate fuel oil. With the exception of IC Unit P11, Duke Energy Florida currently owns the capacity of all other Intercession City units year round.
Duke Energy Florida is a unit of Duke Energy (NYSE: DUK), while Georgia Power is a subsidiary of Southern Co. (NYSE: SO).