The Federal Energy Regulatory Commission on May 6 approved a March 29 application from Calhoun Power Co. LLC requesting authorization for a deal where East Alabama Generating LLC will indirectly acquire from Calhoun Generating LLC 100% of its membership interests in Calhoun Power.
Calhoun Power is an exempt wholesale generator (EWG) with market-based rate authority. Calhoun Power owns a 632-MW dual fuel, simple cycle generation facility located in Calhoun County, Alabama. The Calhoun Facility is interconnected to the transmission system of the Southern Co. (NYSE: SO) and is situated within the Southern balancing authority area (Southern BAA).
Calhoun Power said that output from the Calhoun Facility is committed to an unaffiliated entity under a long-term off-take agreement that is structured as a tolling agreement.
Calhoun Power is wholly owned by Calhoun Power Holdings LLC, which in turn is wholly owned by Calhoun Generating. Calhoun Generating is indirectly owned by LS Power Development LLC, a developer, owner and operator of independent power projects.
The buyer, East Alabama Generating, is a wholly owned subsidiary of Harbert Power Fund V LLC (HPF V), which was formed to invest in EWGs, qualifying facilities (QFs), and related power assets. HPF V is managed by Harbert Power MM V LLC, a wholly owned subsidiary of Harbert Management Corp. (HMC). HMC is an institutional investment manager regulated by the Securities and Exchange Commission.
The now-approved transaction involves a purchase and sale agreement between Calhoun Generating and East Alabama Generating. Under the agreement, East Alabama Generating will acquire 100% of Calhoun Generating’s interests in Calhoun Holdings. East Alabama Generating will then become the sole equity owner of Calhoun Holdings, and, as a consequence, of Calhoun Power.