April 16, 2008
PPL Enters into Tolling Agreement at 664MW Pennsylvania Plant
Pennsylvania-based utility PPL's subsidiary has entered into a purchase and sale agreement for the acquisition of rights to the capacity and energy of a 664MW natural gas-fired power plant in Lebanon, Pennsylvania.
PPL EnergyPlus, PPL's energy marketing subsidiary, has agreed to acquire a long-term tolling agreement from BE Ironwood, a subsidiary of The Bear Stearns Companies. The combined-cycle plant will continue to be owned and operated by a subsidiary of Virginia-based utility AES.
Under the tolling arrangement, PPL EnergyPlus will pay AES Ironwood compensation for generating electricity at the plant with natural gas supplied by PPL EnergyPlus. The tolling arrangement runs through December 2021.
Joe Hopf, president of PPL EnergyPlus, said: "This tolling agreement will provide us with immediate additional capacity in the Pennsylvania-Jersey-Maryland region. While PPL continues to pursue opportunities to acquire or build new assets, we also are opportunistically taking advantage of cost-effective arrangements in which we can increase the megawatts we have at our disposal in the short term."