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FirstEnergy to divest 152-MW Ohio merchant plant to ArcLight, Olympus Power


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FirstEnergy to divest 152-MW Ohio merchant plant to ArcLight, Olympus Power

FirstEnergy Generation is seeking approval from the Federal Energy Regulatory Commission to sell an Ohio merchant power plant to an entity owned by ArcLight Capital Partners LLC and Olympus Power LLC.

The FirstEnergy Corp. subsidiary filed an application March 20 to divest the Bay Shore facility in Lucas County, Ohio, to Walleye Energy LLC. The facility consists of the 136-MW Bay Shore unit 1 and the 16-MW oil-fired Bay Shore CT. Bay Shore unit 1's primary fuel is petroleum coke, according to S&P Global Market Intelligence data.

The output of the facility is sold at wholesale pursuant to its market-based rate tariff.

In July 2016, FirstEnergy announced plans to sell or deactivate Bay Shore unit 1 by May 2020, citing difficult conditions in the PJM Interconnection market. FirstEnergy has since reiterated a commitment to exiting its competitive business.

Walleye Energy is a subsidiary of Orca Acquisitions LLC, in which 95% of the class A managing interests are held by a subsidiary of ArcLight Energy Partners Fund VI LP. Olympus Power owns the remaining 5% class A stake, according to the application, and 100% of the class B nonmanaging interests in Walleye through subsidiaries.

The transaction also includes the purchase of three retired coal-fired generation units from FirstEnergy Generation and a circulating fluidized bed boiler. Financial details of the transaction were not disclosed. Walleye intends to sell the output from Bay Shore at wholesale pursuant to its market-based rate authorization, according to the application.

The deal is expected to close soon after Walleye Energy receives market-based rate authorization from FERC, which is expected by May 21.

The applicants have asked the commission to approve the application by June 18. (FERC docket EC18-72)