Laidlaw to buy California power plant
Laidlaw Energy Group Inc. is looking to expand its operations outside the U.S. East Coast, having recently executed a letter of agreement to purchase a 14-megawatt (MW) biomass power plant in California.
The company currently has two biomass power projects under development, a 7-MW facility in New York and a 65-MW plant in New Hampshire. “We are very pleased to be moving forward with the expansion of our business model to the West Coast,” said Michael Bartoszek, Laidlaw CEO. “We are very excited about the California market for alternative energy and the opportunities it presents.”
The transaction would mean Laidlaw purchases the facility from current owner Renegy Holdings Inc., along with other shareholders, according to Laidlaw. The facility is idle so Laidlaw will be upgrading the equipment and hiring a new crew prior to startup, expected in early- to mid-2013, according to Lou Bravakis, Laidlaw’s executive vice president. Once operating, the plant will run on low-grade forest residue material, although fuel supply contracts, as well as power purchase agreements, have yet to be finalized, he added.
“This is our first West Coast project but it fits our business model of acquiring existing assets which we can add value to that are located in markets that are favorable to renewable energy, such as California,” Bravakis said, adding that the terms of the agreement with Renegy restrict disclosure of the plant’s specific location within the state. Renegy’s website, however, says it purchased a 13-MW idle biomass power plant in Susanville, Calif., in 2007, and had plans to restart it in 2010. In 2009, Renegy delisted and deregistered its common stock as a cost-saving measure. The company website does not include information on any other California plant locations.
Bartoszek said the transaction is part of a larger strategy of growth and diversification that Laidlaw has been pursuing for some time. “We shortly expect to announce another major acquisition that will further expand our business,” he said. “In addition we have been working to add highly qualified project management personnel to our team so that we have the necessary resources in place to manage multiple projects across the U.S.”