New Jersey-based utility Public Service Enterprise Group has found a buyer for its 6,750-MW fossil generation fleet in a subsidiary of private equity firm ArcLight Capital Partners.
PSEG, which decided two years ago it was committed to its nuclear power plant assets and would divest most of its remaining generation, is letting go of its gas and coal-fired portfolio for about $1.92 billion. The deal with ArcLight Energy Partners Fund VII, L.P. could be closed by the end of this year or early 2022.
“A year ago, we announced the strategic review of PSEG’s non-nuclear generating assets in line with our long-term focus on regulated utility growth, improving our business mix and enhancing an already compelling environmental, social and governance profile,” PSEG Chairman, President and CEO Ralph Izzo said. “With today’s agreement, which is the result of a robust sale process, PSEG is on track to realize a more predictable earnings profile. Further, this transaction continues our evolution toward a clean energy infrastructure-focused company that will enable our increasingly low-carbon economy.”
PSEG sold its Solar Source assets to Quattro Solar, a division of LS Power, earlier this year. Overall, the divestment will gain the utility company some $2.15 billion in after-tax proceeds.
The PSEG Fossil deal with ArcLight comprises 13 generation units in New Jersey, Connecticut, Maryland and New York.
PSEG Power, another subsidiary, shut down the coal-fired Bridgeport Harbor Unit 3 in June. It was the company’s final coal-fired generation plant still in operation.
In April, the New Jersey Board of Public Utilities extended zero-emission certificates for three PSEG-own nuclear power plants located in the state. Those New Jersey reactor units are Salem 1 and 2 and Hope Creek.
PSEG’s principal operating subsidiaries are: Public Service Electric and Gas Co. (PSE&G), PSEG Power and PSEG Long Island.