BY CONTINUING TO USE THIS SITE, YOU ARE AGREEING TO OUR USE OF COOKIES. REVIEW OUR
COOKIE NOTICE

Register with us today

and in less than 60 seconds continue your access to: Latest news headlines Analytical topics and features Commodities videos, podcast & blogs Sample market prices & data Special reports Subscriber notes & daily commodity email alerts

Already have an account?

Log in to register

Forgot Password

Enter your Email ID below and we will send you an email with your password.


  • Email Address* Please enter email address.

If you are a premium subscriber, we are unable to send you your password for security reasons. Please contact the Client Services team.

If you are a Platts Market Center subscriber (https://pmc.platts.com), Please navigate to Platts Market Center to reset your password.

In this list
Electric Power

Combined Vistra-Dynegy must sell 1,281 MW to stay under cap: Texas PUC staff

Electric Power | Emissions | Metals | Non-Ferrous

Battery 'Gigafactories' and their impact on battery metals raw materials

Electric Power

Platts Market Data – Electric Power

Commodities | Electric Power | Metals

Battery Metals Conference, Inaugural

Electric Power

Georgetown reaches 100% renewables, but some question validity of claim

Combined Vistra-Dynegy must sell 1,281 MW to stay under cap: Texas PUC staff

A merged Vistra Energy and Dynegy must divest at least 1,281 MW of Texas generation to stay under the state-mandated cap of 20% of Electric Reliability Council of Texas installed capacity, state regulatory staff said Monday, and Vistra said Tuesday it has "a pathway" to comply, if regulators require divestiture.

Not registered?

Receive daily email alerts, subscriber notes & personalize your experience.

Register Now

On October 30, Dynegy and Dallas-based Vistra Energy announced plans to merge in an all-stock transaction valued at about $1.74 billion, with Vistra as the surviving entity by mid-2018.

On November 22, Vistra Energy's Luminant Power generation subsidiary filed an application for the deal's approval by the Public Utility Commission of Texas.

The PUC staff's final recommendation filed Monday concludes that the combined company would own and control more than 20% of installed capacity that is deliverable in ERCOT, partly because Dynegy owns 820 MW of generation in the Eastern Interconnection "that are capable of delivering electricity to ERCOT" over DC ties, and "that capacity must be included in Luminant's market share calculation."



In an email Tuesday, Vistra spokesman Allan Koenig said the staff recommendation "was an expected and required part of the process."

"This is a factual case in which the Commission must determine solely if our total electric generation is under the 20 percent limit for participants which own and control generation in the Electric Reliability Council of Texas region," Koenig said. "We look forward to presenting our case to the Commissioners as they consider the agency staff's recommendations and the legal arguments we present. Importantly, nothing has changed with our merger process, and Vistra Energy has a pathway to get under the 20 percent cap if the Commission determines that the combined company will exceed it."


VISTRA-DYNEGY WOULD OWN 18,807 MW IN ERCOT


Before the transaction, Luminant will own 13,945 MW of generation in ERCOT, while Dynegy's total in Texas will be 4,042 MW, and its total outside of Texas will be 22,399 MW, of which only 820 MW is deliverable because of DC tie limitations.

Dynegy's non-Texas generation assets are in California, Connecticut, Illinois, Maine, Massachusetts, New Jersey, New York, Ohio, Pennsylvania, Virginia and West Virginia.

Thus, the proposed combined Vistra-Dynegy would own and control 18,807 MW of ERCOT's 87,632 MW of capacity, which equals 21.46%.

Therefore, the staff memo recommended the following conditions for approving Vistra's acquisition of Dynegy:

* Luminant commits to divesting at least 1,281 MW of installed generation capacity in ERCOT.
* The combined entity files an affidavit certifying sale of the capacity before the merger is completed.
* Luminant terminates a voluntary market power mitigation plan approved in May 2015.
* Luminant files quarterly reports to ensure compliance with the 20% cap for two years or until the combined entity's installed capacity falls below 18.5% of ERCOT's total.
* If Luminant fails to comply with the 20% cap, Luminant files a written report within 30 days.

--Mark Watson, markham.watson@spglobal.com
--Edited by Rocco Canonica, newsdesk@spglobal.com