DEDHAM, Mass., Sept. 20, 2018 /PRNewswire/ -- Atlantic
Power Corporation (NYSE: AT) (TSX: ATP) ("Atlantic Power" or the
"Company") announced today that it has executed an agreement to
acquire two biomass plants in South
Carolina from EDF Renewables Inc. for $13 million. The Allendale plant is located in Allendale, South Carolina and the Dorchester plant in Harleyville, South Carolina. Each of the
plants has a capacity of 20 megawatts.
Closing of the transaction is expected to occur late in the
third quarter or in the fourth quarter of 2019, following a
restructuring of the plants' ownership structure by EDF Renewables
after the end of relevant tax credit recapture periods. The
transaction is not subject to regulatory approval. Atlantic
Power will assume operation of the plants at closing, or
potentially earlier, subject to negotiation of an agreement with
EDF Renewables. The purchase will be funded from the
Company's discretionary cash.
The two plants are identical in design and have been in
commercial operation since 2013. The biomass fuel for the
plants consists primarily of mill and harvesting residues.
All of the output of the two plants is sold to Santee Cooper, a
state-owned utility, under Power Purchase Agreements ("PPAs") that
run to 2043. Under the terms of the PPAs, the plants receive
energy payments for energy produced. The fuel cost component
of the energy revenues is based on a biomass market index.
There is no project-level debt at either plant.
"This acquisition represents our second external growth
investment following a three-year business restructuring
process. Earlier this summer, we closed the acquisition of
the remaining interests in the Koma Kulshan hydro project," said
James J. Moore, Jr., President and
CEO of Atlantic Power. "We own four biomass plants currently,
and we have considerable operational and commercial experience in
this area. If we can deliver targeted operational and
financial results for both South
Carolina plants, the returns should be very attractive
compared to other potential uses of our discretionary cash.
In addition, the long remaining term of the two PPAs provides a
stable base of cash flows."
About Atlantic Power
Atlantic Power is an independent power producer that owns power
generation assets in nine states in the
United States and two provinces in Canada. The
generation projects sell electricity and steam to investment-grade
utilities and other creditworthy large customers predominantly
under long‑term PPAs that have expiration dates ranging from 2019
to 2037. The Company seeks to minimize its exposure to
commodity prices through provisions in the contracts, fuel supply
agreements and hedging arrangements. The projects are
diversified by geography, fuel type, technology, dispatch profile
and offtaker (customer). The majority of the projects in
operation are 100% owned and directly operated and maintained by
the Company. The Company has expertise in operating most fuel
types, including gas, hydro, and biomass, and it owns a 40%
interest in one coal project.
Atlantic Power's shares trade on the New York Stock Exchange
under the symbol AT and on the Toronto Stock Exchange under the
symbol ATP. For more information, please visit the Company's
website at www.atlanticpower.com or contact:
Atlantic Power Corporation
Investor Relations
(617) 977-2700
info@atlanticpower.com
Copies of the Company's financial data and other publicly filed
documents are available on SEDAR at www.sedar.com or on EDGAR at
www.sec.gov/edgar.shtml under "Atlantic Power Corporation" or on
the Company's website.
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Cautionary Note Regarding Forward-Looking Statements
To the extent any statements made in this news release contain
information that is not historical, these statements are
forward-looking statements within the meaning of Section 27A of the
U.S. Securities Act of 1933, as amended, and Section 21E of the
U.S. Securities Exchange Act of 1934, as amended, and under
Canadian securities law (collectively, "forward-looking
statements").
Certain statements in this news release may constitute
"forward-looking statements", which reflect the expectations of
management regarding the future growth, results of operations,
performance and business prospects and opportunities of the Company
and its projects. These statements, which are based on
certain assumptions and describe the Company's future plans,
strategies and expectations, can generally be identified by the use
of the words "may," "will," "project," "continue," "believe,"
"intend," "anticipate," "expect" or similar expressions that are
predictions of or indicate future events or trends and which do not
relate solely to present or historical matters. Examples of
such statements in this press release include, but are not limited,
to statements with respect to the following:
- The Company's views of potential returns on this investment if
it is able to achieve targeted operational and financial results
for the plants, and how those returns compare to other potential
uses of discretionary cash; and
- the stability of cash flows under the PPAs for both
plants.
Forward-looking statements involve significant risks and
uncertainties, should not be read as guarantees of future
performance or results, and will not necessarily be accurate
indications of whether or not or the times at or by which such
performance or results will be achieved. Please refer to the
factors discussed under "Risk Factors" and "Forward-Looking
Information" in the Company's periodic reports as filed with the
U.S. Securities and Exchange Commission (the "SEC") from time to
time for a detailed discussion of the risks and uncertainties
affecting the Company. Although the forward-looking
statements contained in this news release are based upon what are
believed to be reasonable assumptions, investors cannot be assured
that actual results will be consistent with these forward-looking
statements, and the differences may be material. These
forward-looking statements are made as of the date of this news
release and, except as expressly required by applicable law, the
Company assumes no obligation to update or revise them to reflect
new events or circumstances.
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SOURCE Atlantic Power Corporation