By the OGJ Online Staff
HOUSTON, July 26 -- NRG Energy Inc. Thursday said federal regulators delayed its proposed acquisition of two Connecticut power plants from Wisconsin Energy Corp., while they examine its impact on market power in the region.
The Minneapolis, Minn., company said the Federal Energy Regulatory Commission plans to "further explore issues related to the competitive effects" of NRG's purchases of the Bridgeport and New Haven Harbor stations, and expects a report within 90 days.
NRG already owns 2,234 Mw in Connecticut, including four steam electric generating stations -- Devon, Middletown, Montville (Uncasville), and Norwalk Harbor -- and four remote jet stations -- Branford, Cos Cob, Torrington (Franklin Drive), and Torrington Terminal.
The Bridgeport and New Haven plants would add another 1,051 Mw to NRG's existing Connecticut portfolio. The company said the $325 million acquisition will be delayed beyond the expected close in the third quarter, but the company maintained its earnings forecast of $1.35/share for 2001.
"NRG is confident the FERC will ultimately approve the transaction," the company said in a statement . NRG said the base load coal-fired generation would diversify the company's gas dependent Northeast asset portfolio.
Craig Mataczynski, CEO of NRG North America, said the company remains committed to reducing sulfur emissions 50% at the New Haven facility, and, after installing additional environmental controls, reducing sulfur emissions by more than 90% at the Bridgeport Harbor facility.
Michael John, a spokesman for Wisconsin Energy, said the company also remains committed to selling the Connecticut plants as part of its strategy to dispose of noncore assets and refocus on its Milwaukee service territory.
He said the company plans to use the proceeds of the sale to retire debt, buy back shares, and build new generation in Wisconsin. "We hope to close by yearend," he said. The proposed acquisition is also awaiting approval from the US Justice Department.
Wednesday NRG reported second quarter net income of $49.1 million, or 25¢ a share, compared with $43.6 million, or 28¢ a share in the year earlier period. NRG said operating revenues for wholly-owned operations for the quarter were $661.3 million, compared with $473.8 million last year.
Wisconsin Energy Thursday reported second quarter earnings of $46.1 million or 39¢/share, compared to $30.1 million, or 25¢/share in the year earlier period.
Excluding gains on asset sales, the company reported recurring earnings of 25¢/share, compared with pro forma earnings of 23¢/share in the 2001 second quarter.
