Electric Power news briefs, June 13
Westmoreland Coal Co. ... Knife River Corp. ... Potomac Electric Power Co. ... Southern Energy Inc. ... Carolina Power & Light Co. ... SeaWest WindPower ... Bonneville Power Administration
Westmoreland Coal Co. and Knife River Corp, a unit of MDU Resources Group Inc., confirmed they have entered into negotiations under which Westmoreland will buy Knife River's coal operations, including active coal mines in North Dakota and Montana, coal sales agreements, reserves, and mining equipment. Westmoreland Coal Co., Colorado Springs, Colo., is implementing a strategic acquisition plan for expansion in the changing energy marketplace. The company's current core operations are Powder River basin coal mining through its 80%-owned subsidiary Westmoreland Resources Inc. and independent power production through its wholly owned subsidiary Westmoreland Inc. The company also holds a 20% interest in Dominion Terminal Associates, a coal shipping and terminal facility in Newport News, Va.
Fitch IBCA views the recently announced sale of Potomac Electric Power Co.'s (PEPCO) generation assets as supportive of credit quality, the rating agency said. PEPCO has entered into an agreement to sell 5,889 Mw, including its entitlements under five purchased power agreements, to Southern Energy Inc. for $2.65 billion (OGJ Online, June 8, 2000). Fitch expects PEPCO to maintain its capital structure and risk profile at levels commensurate with its current rating category, senior secured, of A+. Fitch currently rates PEPCO as follows: first mortgage bonds and collateralized PCRBs, A+; convertible debentures and medium-term notes, A; preferred stock and convertible preferred stock, A�; and commercial paper, F1. Fitch said it will be meeting with management during the third quarter to review the company's financing and business expansion plans
Carolina Power & Light Co., Raleigh, NC, is asking the North Carolina Utilities Commission (NCUC) to approve an $80.6 million�or 3.8% increase� in its fuel rate to recover a fuel cost shortfall for the period ending Mar. 31, 2000, and to meet expected higher fuel costs in the near future, the company reported. The increase would take effect Oct. 1, 2000. The fuel rate is a regulated, direct pass-through charge on all electric consumers for the actual cost of fuel to the utility to produce electricity. The increase would average $2.38/month for a residential electric bill based on 1,000 kw-hr/month. CP&L received a similar fuel factor increase in South Carolina this year.
SeaWest WindPower Inc. is seeking to construct a 24.6 Mw wind power project in Gilliam County, Ore., scheduled to be completed later this year, the company said. The Bonneville Power Administration will conduct an environmental review of the project and is considering a 20-year power purchase agreement for all the project's output. SeaWest has identified and acquired several sites in the Pacific Northwest, with the goal of developing 300 to 500 Mw of renewable energy projects in Oregon and Washington, said CEO Jan Paulin. SeaWest has developed over 85 Mw of utility-scale wind energy projects in the Foote Creek area of Wyoming, in addition to nearly 500 Mw of projects in California, the UK, and Spain.