5 July 2002 – Wisconsin Public Service Corp. announced recently that it has signed agreements to purchase the 180-MW De Pere Energy Center and will enter into a power purchase agreement for up to 235 MW of capacity and energy for 10 years from Calpine’s proposed Sherry Energy Center to be located near Marshfield, Wisconsin.
The agreement, originally announced in April, calls for Wisconsin Public Service to pay Calpine $120.4 million ($72 million at close and $48.4 million near year-end 2003) for the De Pere transaction that includes termination of the existing power purchase agreement. The cost of the capacity purchases from the Sherry Energy Center will be approximately $250 million over the 10- year period. Wisconsin Public Service will be responsible for supplying the fuel for the energy it receives from the Sherry Energy Center.
“Everybody wins in the De Pere deal,” said Charlie Severance, Wisconsin Public Service’s Director of Bulk Power Supply. “It’s good for Public Service and its customers, because we’ll have a better mix of resources that will mean lower rates for our customers. Termination of the existing De Pere Energy Center power purchase agreement will allow additional flexibility to acquire future supply that takes advantage of changes in technology to provide lower- cost options to meet the increasing demands of Public Service’s customers.
“The Sherry Energy Center power purchase agreement helps to provide continued growth of the competitive generation market in Wisconsin, which we believe is important. The addition of new generation in Central Wisconsin will improve the reliability of the State’s electric system. We’re very pleased to have the definitive agreement signed,” Severance continued.
The power from the De Pere Energy Center was already under long-term contract to Wisconsin Public Service. In addition, Wisconsin Public Service will purchase 150 megawatts of electricity in 2005, increasing to an estimated 235 MW in 2006 through 2015, from Calpine’s proposed Sherry Energy Center. The additional capacity is needed by Public Service to serve expected growth in northeast Wisconsin.
The acquisition and purchase agreements further strengthen electric supply to Wisconsin Public Service customers in the coming years. The agreements are subject to regulatory approvals, including the Public Service Commission of Wisconsin. It is expected that the transaction will close during the third quarter of 2002.
About Wisconsin Public Service: Wisconsin Public Service Corporation is an electric and natural gas utility serving Northeast and North Central Wisconsin and an adjacent portion of Michigan’s Upper Peninsula. A subsidiary of WPS Resources Corporation, Wisconsin Public Service serves approximately 400,000 electric customers and 300,000 natural gas customers.