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19 November 2004 - Constellation Energy has announced that its wholesale origination and risk management arm, Constellation Energy Commodities Group, Inc., has signed a 570 MW, four year power purchase agreement with Dynegy Power Marketing, Inc.
The power purchase agreement covers power generated by two combined cycle units at the Kendall Plant, located south of Chicago, USA.
President of Constellation Energy Commodities Group, Thomas V. Brooks, said, "The physical characteristics of the Kendall plant are particularly good, and the energy products we expect to receive will add an attractively priced new generation resource to our competitive supply portfolio."
Under the terms of the agreement, Constellation Energy will receive $117.5m in cash from Dynegy and effectively assume Dynegy's rights, benefits and obligations under a 570 MW power purchase agreement with LSP-Kendall Energy, LLC. The deal will commence 1 December 2004 and is for a period of four years.
In exchange for the cash payment and benefits including energy, capacity and ancillary product revenue, Constellation Energy will pay Dynegy an amount equal to the payment obligations under the Kendall power purchase agreement for the relevant four-year term.
Dynegy has retained the rights, benefits, and obligations under the power purchase agreement from December 2008 through the remainder of the term.
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