Boston Edison Issues RFP For 2,000 MW
Boston Edison issued a request for proposals (RFP) seeking bids
for about 2,000 MW of electricity to replace power now supplied by
Sithe Energies from plants Sithe recently bought from Boston
Edison. The short-term power purchase agreement with Sithe expires
Nov. 30. The power purchased through this competitive bidding
process, combined with power from the Pilgrim nuclear plant and
other power supply contracts, will be used to meet Edison's needs
Dec. 1 through May 31, 1999. Proposals must be submitted by Aug. 3.
In December, Sithe Energies won the bidding to purchase Edison's
oil and gas-fired generating assets. The purchase price of Edison's
almost 2,000 MW of generating capacity was $536 million. Sithe also
paid $121 million for the six-month transitional power sales
agreement under which Boston Edison will continue to buy power from
the plants. At the time of the sale, Boston Edison said it would
help put the utility on track to achieve a 15% rate reduction for
all customers by Sept.1, 1999, called for under legislation passed
and signed into law last year.
Sithe said it planned to build 2,800 MW of new generating
capacity on the Edison sites at a cost of more than $1 billion.
Boston Edison's largest plants are in Boston and Everett, MA, with
total capacity of 1,768 MW. Smaller units are in Framingham (33
MW), Medway (126 MW) and Weymouth, MA (24 MW). A share of a power
plant in Yarmouth, ME (36 MW) was also included in the sale to
Sithe. The book value of the plants is $450 million.
Sithe Energies, a privately held company, is the third largest
private sector electric power generation company in the United
States. It also is operating or building power plants in Canada,
Australia, China and Thailand.
In April Boston Edison solicited offers for the Pilgrim Station
nuclear plant and associated assets in Plymouth, MA. The company
views the sale of Pilgrim Station as a continuation of its strategy
of exiting the generation business to become a wires-based delivery
company. Pilgrim is a 670 MW boiling water reactor located on 1,675
acres of land bordering Cape Cod Bay. Boston Edison is the sole
owner of the plant. Approximately 25% of its capacity is under
long-term power purchase contracts to various New England
utilities. The plant is connected to the New England transmission
grid, which provides electricity to the six-state region and
interconnects with New York and Canada.
Joe Fisher, Houston
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