Dynegy sells 50% stake in 1,580-MW Elwood plant in Illinois

Dynegy Inc. (NYSE: DYN) said Nov. 21 that it has finalized the sale of its 50% equity interest in the Elwood Energy Facility to its partner, J-Power USA Development Co. Ltd., for $172.5 million in cash.

The natural gas-fueled peaking facility in Elwood, Illinois, has a 1,580-MW capacity.

As part of the transaction, approximately $35 million in previously posted collateral has been returned to Dynegy, and the nonrecourse asset-level financing remains with the new owner. Dynegy intends to use the net proceeds from the sale to satisfy a portion of the Energy Capital Partners buyout obligation.

The Federal Energy Regulatory Commission on Nov. 2 had approved an Aug. 30 application from Elwood Energy LLC, Dynegy and its public utility subsidiaries, and J-POWER USA Generation LP and its public utility subsidiaries for authorization for a transaction whereby Dynegy would sell its indirect ownership interests in Elwood to J-POWER North American Holdings Co. Ltd.

J-POWER USA Generation LP, the limited partnership vehicle of J-POWER USA Investment Co. Ltd., an affiliate company of J-POWER USA Development Co. Ltd. and the John Hancock Life Insurance Co., acquired this 50% interest in Elwood Energy. J-POWER USA Generation has owned a 50% interest in Elwood through an affiliated company from 2007, and now owns 100% interest of Elwood. J-POWER USA and affiliates now have interests in 10 U.S. power generating facilities totaling approximately 3,500 MW in net ownership.

“The additional acquisition of the 50% interest of Elwood is consistent with our strategy of investing in and developing high quality power generating facilities which connect to reliable power markets, like PJM,” stated Mark Condon, President and CEO of J-POWER USA.  “J-POWER USA will continue to look for opportunities to expand its North American power generation business.”

J-POWER USA Development Co. Ltd. is a wholly owned subsidiary of J-POWER North America Holdings Co. Ltd. which is a wholly owned subsidiary of Electric Power Development Co. Ltd. with headquarters located in Tokyo, Japan. With approximately 25,000 MW of net ownership, J-POWER is one of the world’s largest independent generators of electricity, owning 96 power plants in Japan with total generation of approximately 18,000 MW of installed capacity, and 36 international IPP investments totaling approximately 6,600 MW of net installed capacity.

Throughout the Midwest and Northeast, Dynegy operates power generating facilities capable of producing nearly 25,000 MW.

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.