UK utility moves in on US

UK power generator National Power has announced plans to invest $1.6bn over the next three years in the construction of gas fired power stations in the USA. The company is one of several UK utilities attempting to capitalise on the liberalization of the US market.

Its plans include constructing more than 3000 MW of capacity in Texas, New England and other regions. Other UK utilities, including Scottish Power and PowerGen, have made unsuccessful attempts at entering the US market through mergers or acquisitions.

National Power will build a 1100 MW combined cycle plant at Midlothian in Texas. This plant will be the company`s first greenfield development in the USA. Through its subsidiary, American National Power, it already owns interests in six US power stations.

The Midlothian plant will be built by ABB and will be entirely funded by National Power. It will be operational in 2000. Texas Utilities has agreed to purchase 1000 MW of the plant`s output for an initial two year period.

Talks between Cinergy and Scottish Power were terminated last month. A bid for Cinergy would have cost Scottish Power around £4bn ($2.35bn). Cinergy has also held talks with PowerGen, which earlier this year made a bid to merge with Houston Industries.