FERC okays ownership changes for Tenaska Alabama II Partners

The Federal Energy Regulatory Commission on June 15 approved an April 27 application from Tenaska Alabama II Partners LP for authorization for the acquisition of jurisdictional facilities related to a gas-fired power plant in Alabama.

Specifically, Tenaska Alabama II Inc. (Alabama II Inc.) will acquire from Diamond Alabama II LLC (Diamond Alabama II) an additional 0.30% general partnership interest in Tenaska Alabama II Partners LP and Tenaska Kiowa Investments LLC (Kiowa Investments) will acquire from Diamond Autauga II LP (Diamond Autauga II) a 46.875% limited partnership interest in Tenaska Diamond II.

The applicant states that the transaction may not require commission approval, however, out of an abundance of caution, it nevertheless asks the commission to authorize it. “This order authorizes the Proposed Transaction without making any determination of jurisdiction,” said the June 15 FERC order.

Applicant is an exempt wholesale generator with market-based rate authority, a reactive power rate schedule and it owns and operates an approximately 924-MW, natural gas-fired facility located in Autauga County, Alabama. The facility is situated within the Southern Company Services balancing authority area (SOCO BAA).

Applicant is currently owned by Alabama II Inc., which holds a 0.35% managing general partnership interest; Diamond Alabama II, which holds a 0.3% general partnership interest; TC Alabama GP LLC (TC Alabama GP), which holds a 0.35% general partnership interest; and Tenaska Alabama B LP (Alabama B), which holds a 99% limited partnership interest.

Only the 0.3% general partnership interest held by Diamond Alabama II in applicant is being conveyed in this portion of the approved transaction. Alabama II Inc. is wholly owned by Tenaska Energy, a developer and owner of power production facilities throughout the United States.

Diamond Alabama II is wholly owned by Diamond Generating Corp. (Diamond Generating), which, in turn is indirectly owned by Mitsubishi Corp., a publicly traded corporation under the laws of Japan.

TC Alabama GP is ultimately indirectly owned by ITOCHU Corp. and Chubu Electric Power, both of which are also publicly-traded corporations under the laws of Japan.

Alabama B is owned by: Alabama II Inc., which holds a 1% general partnership interest; Tenaska Diamond II LP (Tenaska Diamond II), which holds a 64% limited partnership interest; and TC Alabama LP LLC, which holds a 35% limited partnership. Further downstream the corporate structure of Alabama II Inc., and as relevant to the rransaction, Tenaska Diamond II is owned by: Tenaska Inc., which holds a 0% general partnership interest; Diamond Nebraska LP (Diamond Nebraska), which holds a 0% general partnership interest; Tenaska, which holds a 26.716449% limited partnership interest; Tenaska Energy Holdings LLC (Tenaska Holdings), which holds a 26.40851% limited partnership interest; and Diamond Autauga II, which holds a 46.87500% limited partnership interest.

Diamond Nebraska is owned by: Diamond Generating, which holds a 1% general partnership interest and a 98% limited partnership interest; and DGC Nebraska Partners Inc. (DGC Nebraska), which holds a 1% limited partnership interest. DCG Nebraska is wholly owned by Diamond Generating. Diamond Autauga II is owned by Diamond Generating, as general partner, and Diamond Nebraska, as limited partner. Kiowa Investments is owned by Tenaska, which owns a 50.28986% membership interest; and by Tenaska Holdings, which owns a 40.71014% membership interest.

Following this transaction, Diamond Generating will no longer own any direct or indirect interests in the applicant. The direct interests in the applicant will be owned by: Alabama II Inc., which will then hold a 0.65% managing general partnership interest; TC Alabama GP, which will continue to hold a 0.35% general partnership interest; and Alabama B, which will continue to hold a 99% limited partnership interest.

The interests in Tenaska Diamond II will be owned by: Tenaska Inc., which will continue to hold a 0% general partnership interest; Tenaska, which will continue to hold a 26.71649% limited partnership interest; Tenaska Holdings, which will continue to hold a 26.40851% limited partnership interest; and Kiowa Investments, which will then hold a 46.875% limited partnership interest. Applicant also stated that Diamond Nebraska will withdraw as a general partner of Tenaska Diamond II.

About Barry Cassell 20414 Articles
Barry Cassell is Chief Analyst for GenerationHub covering coal and emission controls issues, projects and policy. He has covered the coal and power generation industry for more than 24 years, beginning in November 2011 at GenerationHub and prior to that as editor of SNL Energy’s Coal Report. He was formerly with Coal Outlook for 15 years as the publication’s editor and contributing writer, and prior to that he was editor of Coal & Synfuels Technology and associate editor of The Energy Report. He has a bachelor’s degree from Central Michigan University.