Tenaska closes $780m gas plant financing

Tenaska has closed roughly $780 million in commercial financing for the Westmoreland Generating Station, a Pennsylvania natural gas-fired power plant. 

The 925 MW plant will be located about 45 miles south of Pittsburgh in South Huntingdon Township, Westmoreland County. The company purchased the plant site south of the intersection of Route 31 and Interstate 70 in 2009.

MUFG Union Bank, BNP Paribas, Citigroup Global Markets and Industrial and Commercial Bank of China led the financing group, Tenaska said. According to vice president and treasurer Dave Kirkwood, the forward capacity market in PJM Interconnection – which delivers power in 13 eastern states and the District of Columbia – and five-year revenue hedging were “key to the success of the financing”. 

The project is owned by Tenaska Pennsylvania Partners, which comprises Tenaska and Mitsubishi Corporation subsidiary Diamond Generating Corporation. 

Construction began on the Westmoreland plant earlier this year, the company said, and commercial operation is set to start in 2018, with Black & Veatch as the engineering, procurement and construction contractor. Two natural gas turbines from Mitsubishi Hitachi Power Systems (MHPS) will power the plant. 

Originally, the plan was for construction to begin last year, but has been delayed repeatedly since inception. The latest delay came when Tenaska revised its air quality plan after MHPS determined that fewer pollutants would be released starting up and shutting down the system than originally anticipated in estimates prepared in 2014. 

Tenaska vice president of environmental affairs Larry Carlson said that the lower environmental impact would be achieved through emissions control equipment and 20 percent fewer power plant startups and shutdowns.