BPP Doubles Its Megawatts in the US, Acquiring “Temple II” CCGT Power Plant with Immediate Income Recognition
Banpu Power Public Company Limited, or BPP, an international quality power generating company committed to delivering sustainable energy, which is the parent company of BPPUS, has closed on the purchase of CXA Temple 2 Holdco, LLC, the entity that owned the 755 MW Temple II gas-fired power plant located in Temple, Texas, United States. The acquisition of the new operational plant offers exceptional growth prospects for BPP in the United States, benefiting from synergies with the Temple I power plant and the ability to generate immediate cash flow.
The agreement was made through Temple Generation Intermediate Holdings II, LLC1, a subsidiary of BPP. The acquisition will augment BPP’s production capacity in proportion to its investment by an amount of 378 MW.
Mr. Kirana Limpaphayom, Chief Executive Officer of Banpu Power Public Company Limited, said, “This investment aligning with BPP’s Greener & Smarter Strategy marks a significant milestone in the ongoing expansion in the strategic country. The acquisition also extends our business ecosystem, which is currently expanding into other sectors along the entire value chain in the US market. This includes the Temple I gas-fired power plant, a power trading business in the Electric Reliability Council of Texas (ERCOT) merchant power market, one of the top seven electricity markets with the highest utilization rate in the US, and electricity sales to household customers (Power Retail).
Considering the existing Temple I gas-fired power plant, the strategic proximity between our two power plants, Temple I and Temple II, will generate synergistic value. This will enable us to operate and manage the power plants efficiently, resulting in improved flexibility and reliability in electricity generation. Consequently, we can seize greater profit opportunities in the merchant market and optimize resource utilization, leading to economies of scale.”
The Temple II gas-fired power plant has four key strengths: 1) It’s a large power plant with Combined Cycle Gas Turbine (CCGT) technology, renowned for its modernity, efficiency, high flexibility, and advantageous merit order, making it well-suited for meeting the demands of dynamic merchant market like ERCOT. Additionally, it employs advanced emissions-control technology, establishing itself as one of the leading environmentally friendly gas-fired power plants in the United States; 2) The Temple II gas-fired power plant has the electricity capacity to support approximately 750,000 households across central Texas, playing a vital role in meeting the region’s demand for electricity; 3) The strategic location facilitates efficient power distribution, allowing the plant to respond to the real-time, dynamic demands of the merchant power market. Being co-located with the Temple I gas-fired power plant enhances the Temple II plant’s operational efficiency, optimizes resource utilization, and affords BPP greater opportunities to capture profits in the merchant market; 4) The additional capacity strengthens BPP’s competitive position in managing breakeven points and diversifying risks along the Company’s power business value chain.
“BPP expects to realize revenue from this asset by the third quarter of 2023. Our Company remains committed to expediting investment opportunities in environmentally friendly power plants that use HELE technologies in eight strategic countries. This approach aims to foster the balanced growth of our business portfolio, which encompasses both the conventional fuel-based (Thermal Power Business) and renewable energy (Renewable Power Business) and accelerate our effort to achieve the capacity target of 5,300 MW by 2025,” concluded Mr. Kirana.
