Dominion is investigating the possible sale of four merchant power plants located in Indiana, Pennsylvania, West Virginia and Ohio, CEO Tom Farrell told investors during a conference call last week. Meanwhile, the company is keeping an eye on the Point Beach nuclear power plant, which could be put up for sale by Wisconsin Energy.

Farrell said that the company is exploring the possible sale of the State Line power plant (coal-fired, Hammond, IN, net summer capability: 515 MW), and three gas-fired peaking units — Armstrong (Shelocta, PA, net summer capability: 625 MW), Troy (Luckey, OH, net summer capability: 600 MW) and Pleasants (St. Mary’s, West Virginia, net summer capability: 313 MW).

“These plants represent 7% of our generation capacity and about 3% of our 2005 overall production,” he noted. “Given current market valuations for these type of assets, we anticipate that a transaction will not only improve our return on invested capital, it will be accretive to earnings and our credit metrics.”

Farrell said that the company is “intent on making sure that we have the best performing assets that Dominion can have and operate in the Dominion family as we go forward, wherever they come from.”

The plants “operate well; we have great personnel located at each of them, but they don’t keep up with the rest of our company’s goals on return on invested capital.”

Meanwhile, Farrell said that the Point Beach nuclear power plant in Wisconsin is “certainly an asset we’ll be very interested in. As we go along through the process, I’m sure others will be interested in it, as they were in Palisades.”

Entergy Corp. and Consumers Energy recently reached an agreement for Entergy to purchase the 798 MW Palisades nuclear plant near South Haven, MI, for $380 million.

“We were certainly interested in Palisades,” Farrell said. “I won’t comment on what other folks do; we just were unable to get to where they got.”

Concentric Energy Advisors recently sent out inquiries to owners and operators of nuclear plants in the U.S. trying to gauge interest in a possible purchase of the plant or operating the plant on behalf of We Energies. We Energies is a unit of Wisconsin Energy.

Earlier this year, Wisconsin Energy CEO Gale Klappa said that the company would undertake a formal review related to its Point Beach nuclear power plant, and that possible options included the sale of the facility. Dominion already owns the Kewaunee nuclear station in Wisconsin.

Dominion reported unaudited net income determined in accordance with generally accepted accounting principles for the three months ended June 30 of $161 million (46 cents/share), compared to net income of $332 million (97 cents/share) for the same period last year.

Operating earnings for the three months ended June 30 amounted to $295 million (84 cents/share) compared to operating earnings of $340 million (99 cents/share) for the three months ended June 30, 2005.

©Copyright 2006Intelligence Press Inc. All rights reserved. The preceding news reportmay not be republished or redistributed, in whole or in part, in anyform, without prior written consent of Intelligence Press, Inc.