FirstEnergy selling hydroelectric plants, including Lake Lynn station
FirstEnergy Corp. is seeking government approval to sell 11 hydroelectric power generation plants, including the Lake Lynn Power Station in Springhill Township.
The Lake Lynn plant at the Cheat River dam is among four plants in Pennsylvania, three in West Virginia and four in Virginia that FirstEnergy of Akron, Ohio, intends to sell to Harbor Hydro Holdings LLC, a subsidiary of the employee-owned LS Power Equity Partners II, LP, which has offices in New York, New Jersey, Missouri and California.
Harbor Hydro is expected to retain the 35 employees who work at the plants, said FirstEnergy spokeswoman Stephanie Thornton.
A sales agreement with Harbor Hydro Holdings was reached on Aug. 23 and has been submitted to the Federal Energy Regulatory Commission, Virginia’s State Corporation Commission and other agencies for approval. The companies expect to close the sale in the fourth quarter this year if the sale is approved.
“It’s consistent with our larger plan to divest non-strategic, non-regulated power generating plants,” Thornton said.
The sale is not related to FirstEnergy’s recently announced plans to deactivate the Hatfield’s Ferry Power Station in Greene County and the Mitchell Power Station in Washington County, she said.
“The deactivations of the Hatfield and Mitchell power stations were due to low demand for electricity and the cost of future environmental regulations. We first announced the intention to sell up to 1,180 megawatts of unregulated, hydro-generation assets during the fourth quarter 2012 quarterly investor call, held in February 2013,” Thornton said. “The sale of these units supports the company’s financial plan to divest non-core, unregulated generation assets and use the proceeds to improve credit metrics in our competitive business. These units were chosen for sale as they are more attractive to potential buyers versus other generating assets.”
The plants in the proposed sale can produce a combined maximum of 527 megawatts of electricity, which is less than 3 percent of FirstEnergy’s total generation output.
Some of the plants in the sale are owned by FirstEnergy subsidiaries Allegheny Energy Supply Co. LLC and Green Valley Hydro LLC.
The Lake Lynn Power Station, which can produce up to 3 megawatts, has been in operation since 1926. Allegheny Energy owns the plant.
The lake is named after A.M. Lynn, president of West Penn Power from 1917 to 1927, who was instrumental in building the plant.