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The FERC green-light came Friday, Dynegy officials confirmed, but the transaction as a whole cannot close unless Illinois Pollution Board approvals are also received so that pollution-control equipment can be installed that meets state code.
The IPCB is expected to make its decision on the waiver request on or before November 21.
“Dynegy believes the acquisition of the AER facilities through IPH provides the best future for the five AER plants, their employees and the surrounding communities,” Dynegy president and CEO Robert Flexon said.
Should Illinois officials return a positive decision to the pollution control request, the two companies expect the deal to close before the end of the year.
In March Ameren agreed to sell the 410 megawatt Duck Creek, 650MW E D Edwards, 895MW Coffeen 1,197MW Newton and 1002MW Joppa coal plants to Dynegy.
Including the Ameren plants, Houston-based Dynegy said it would have more than 8000MW of generating capacity in Illinois and about 14,000MW across the US post-deal.
“We expect that this transaction will reduce business risk and improve the predictability of our future earnings and cash flows, which is expected to strengthen Ameren’s credit profile and support Ameren’s dividend,” Ameren chairman and CEO Thomas Voss said at the time.
The transaction is Ameren’s official exit from the merchant generation business, making good on a December 2012 announcement that it would sell off its units to focus on regulated operations in Illinois as well as Missouri.
In related Ameren news, FERC also approved the transfer of the Elgin, Grand Tower and Gibson City merchant gas-fired energy centers in Illinois which were not part of the Dynegy transaction.
Those will transfer from Ameren Energy Generating Company, or Genco, to Ameren Energy Medina Valley Cogen.
In addition, Medina Valley made a deal to sell the Elgin, Gibson City and Grand Tower gas-fired energy centers to a special purpose entity affiliated with and formed by private equity firm Rockland Capital
That deal closing is also expected by the end of the year.
