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29 November 2006 -- American Electric Power announced today that its Columbus Southern Power utility subsidiary has agreed to purchase the Darby Electric Generating Station from DPL Energy, LLC, a subsidiary of DPL Inc., for approximately $102 million.
The transaction is contingent on the receipt of required regulatory approvals from the Federal Energy Regulatory Commission (FERC) and federal clearance pursuant to the Hart-Scott-Rodino Antitrust Improvements Act of 1976, and is expected to close in the first half of 2007.
The Darby plant, located approximately 20 miles southwest of Columbus, Ohio, near Mount Sterling, is a natural-gas, simple-cycle power plant with a nominal generating capacity of 480 megawatts and a summer capacity of approximately 450 MW. The plant began commercial operation in 2001.
"Our forecasts indicate that the growing electricity needs of customers in our eastern seven states' footprint will soon be beyond the capabilities of our existing fleet of power plants," said Michael G. Morris, AEP's chairman, president and CEO. "Our strategy for meeting growth in demand includes two equally important facets: the construction of new plants, like the clean-coal Integrated Gasification Combined Cycle generation projects we are pursuing in Ohio and West Virginia, and the acquisition of recently completed gas-fired merchant plants when the price is right.
The Darby plant will help AEP keep pace with 2 percent annual growth in peak demand in its eastern service area and help the company maintain the 15 percent reserve margin required by the PJM Interconnection to ensure reliability. When the transaction closes, AEP will operate the Darby plant as part of the company's generation pool that provides power to AEP's utility units serving customers in Indiana, Kentucky, Michigan, Ohio, Tennessee, Virginia and West Virginia.
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