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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