Japanese energy giant buys into U.S. biomass power industry
A Tokoyo-based energy company has acquired shares in five biomass-based power facilities located in California from Chicago-based Exelon Corp. IHI Inc., a subsidiary of IHI Corp. from Japan, will gain 70 MW of generating capacity through the acquisitions. All five facilities have been designated by the Federal Energy Regulatory Commission as qualified renewable energy generation plants, and, each facility has a power purchase agreement already in place with investor-owned utilities.
Mikio Mochizuki, executive officer and CEO of IHI, said the acquisition is an important step for the company. “This acquisition forms a solid platform for IHI’s further expansion into the energy services business in North America,” he said, “which is a key element of our global growth.”
According to IHI, all five facilities already have experienced workforces and the current employees at the plant will be rehired by the new company.
Just as IHI’s acquisition reiterates its renewable energy strategy for the future, Exelon also offered perspective on the importance of the sale of its biomass shares. “The sale of these facilities is part of Exelon’s long-term growth strategy,” according to Christopher Crane, president and CEO of Exelon. “By selling assets that are not consistent with that strategy, we can better focus on positioning our generation portfolio for the future.” Exelon’s current energy generation strategies include a heavy focus on nuclear energy.
The terms of the deal were not disclosed, but the five biomass power plants including in IHI’s acquisition are:
• Chinese Station (biomass) in Jamestown, in which IHI acquired a 9.9 MW share;
• Rio Bravo Fresno (biomass) in Fresno, in which IHI acquired a 12 MW share;
• Rio Bravo Jasmin (coal) in Bakersfield, in which IHI acquired a 17.5 MW share;
• Rio Bravo Poso (coal) in Bakersfield, in which IHI acquired a 17.5 MW share;
• Rio Bravo Rocklin (biomass) in Lincoln, in which IHI acquired a 12 MW share.
IHI acquired Exelon’s 50 percent stake in the four Rio Bravo power plants and 45 percent stake in the Chinese Station plant from Covanta Corp.