More changes come through for Sierra Pacific

Sierra Pacific Resources has found buyers for two more of its generating facilities, while a federal agency has given the nod to its purchase of an Oregon utility, Portland General Electric.

NRG Energy Inc. and Dynegy Inc. agreed to jointly purchase the 740 megawatt gas-fired Clark Generating Station and 590 megawatt of the 605 megawatt, coal-fired Reid Gardner Generating Station, both currently owned by Sierra Pacific Resources' subsidiary, Nevada Power Co., and serving the rapidly growing Las Vegas market.

On Tuesday, the Federal Energy Regulatory Commission unanimously approved Sierra Pacific Resources' application to acquire Portland General Electric, which serves approximately 720,000 electric customers in the Portland-Salem region of northwest Oregon.

Monday's agreement for the sale of the Reid Gardner and Clark stations carried a $634 million price tag.

The sale of its power generation facilities was a regulatory requirement of the merger of Nevada Power Co. and Sierra Pacific Resources, which also owns Sierra Pacific Power Co. Other subsidiaries include the Tuscarora Gas Pipeline Co., which owns a 50 percent interest in an interstate natural gas transmission partnership, and Sierra Pacific Communications, a telecommunications company.

Sierra Pacific Resources is transforming itself into an electrical transmission and distribution company, carrying power from generating facilities into customers' buildings but not generating the electricity itself.

Sales of Sierra Pacific's 50-percent share of the Valmy power station to NRG and its Tracy/Pinon plants and several smaller generation facilities to WPS Power Development were announced in October. Sierra Pacific's 14-percent share of the Mohave power station has also been sold to the AES Corp., leaving the Sunrise and Harry Allen generation facilities in Southern Nevada among the asset packages still on the block.

Sierra Pacific announced in March it would sell all its generating capacity at auction, expecting to gather $1 billion to be invested in the purchase of Portland General Electric.

The price for the Tracy/Pinon combo and smaller plants was $250 million, while the Valmy sale brought $273 million to Sierra Pacific Resources. The share of the Mohave Generating Station went for $667 million, so the auction has brought in $1.824 billion, almost double what was projected. And some assets still for sale.

Sierra Pacific announced its intent to acquire Pacific General Electric in November 1999 and has completed all state and most federal regulatory approvals.

"Federal Energy Regulatory Commission approval is a major milestone in Sierra Pacific's actions to acquire Pacific General Electric," said Sierra Pacific chairman, president and chief executive officer Walter M. Higgins. "We've worked hard to reach this point and we appreciate the diligent work on behalf of FERC staff and all of the parties to bring this transaction closer to completion."

Sierra Pacific has obtained approval from the Oregon Public Utilities Commission and the U.S. Department of Justice. The only remaining approval must come from the U. S. Securities and Exchange Commission, under the Public Utilities Holding Company Act. The transaction is expected to close during the first quarter of 2001.