Attached files
| file | filename |
|---|---|
| 8-K - FORM 8-K - EXELON GENERATION CO LLC | d8k.htm |
| EX-99.1 - PRESS RELEASE - EXELON GENERATION CO LLC | dex991.htm |
 Exelon’s Acquisition of John Deere Renewables
August 31, 2010
Exhibit 99.2 |
 2
Forward-Looking Statements
This presentation includes forward-looking statements within the meaning of the
Private Securities Litigation Reform Act of 1995, that are subject to risks
and uncertainties. The factors that could cause actual results to differ
materially from these forward-looking statements include those discussed
herein as well as those discussed in (1) Exelon’s 2009 Annual Report on Form
10-K in (a) ITEM 1A. Risk Factors, (b) ITEM 7. Management’s
Discussion and Analysis of Financial Condition and Results of Operations and
(c) ITEM 8. Financial Statements and Supplementary Data: Note 18; (2) Exelon’s
Second Quarter 2010 Quarterly Report on Form 10-Q in (a) Part II, Other
Information, ITEM 1A. Risk Factors, (b) Part 1, Financial Information,
ITEM 2. Management’s Discussion and Analysis of Financial Condition and
Results of Operations and (c) Part I , Financial Information, ITEM 1. Financial
Statements: Note 12 and (3) other factors discussed in filings with the Securities
and Exchange Commission (SEC) by Exelon Corporation and Exelon Generation
Company, LLC (Companies). Readers are cautioned not to place undue reliance
on these forward-looking statements, which apply only
as
of
the
date
of
this
presentation.
None
of
the
Companies
undertakes
any
obligation
to
publicly
release
any
revision
to
its forward-looking statements to reflect events or circumstances after the
date of this presentation. |
 3
Transaction Summary
Components of purchase price
•
$860M for operating assets and advanced-stage Michigan development
projects •
Up to $40M in additional payments contingent on commencement of construction
on Michigan development projects
•
Equivalent to ~$1,000/KW
Financing
•
Exelon will fund transaction with Exelon Generation debt (no equity
issuance) •
Clean
capital
structure
with
no
tax
equity
and
project
debt
(1)
•
Ability to utilize production tax credits
735 MW operating portfolio spread across 36 projects located in eight states
•
75% of the operating portfolio is sold under long-term power purchase
arrangements
•
86% of contracted portfolio has PPAs through 2026 or beyond
1,468 MW in development pipeline
•
PPAs
have
already
been
executed
for
230
MW
in
Michigan
–
projects
expected
to
be operational in 2012-2013
Acquisition positions Exelon as a large wind operator, complementing its
world-class nuclear fleet
(1) Except for $1.8M loan from Illinois Finance Authority for AgriWind project in
IL |
 4
Strategic Rationale
Diversify with additional clean generation
•
JDR’s proven wind platform provides unique opportunity and entry point into
U.S. wind business
•
Provides diversity in geographic presence and generation type
•
Supports
Exelon
2020
by
adding
more
“clean”
generation
to
our
portfolio
and
positions us for potential federal RPS
Contracted portfolio with option for future growth
•
75% of operating portfolio sold under long-term PPAs
•
1,468 additional MW in pipeline, of which 230 MW have executed PPAs
•
Only plan further development of contracted assets
Attractive economics and good fit
•
Purchase price compares favorably with other wind transactions
•
Disciplined investment approach aligned with Exelon’s approach
•
Addition of strong renewable energy development team
Acquisition further enhances Exelon’s strong environmental leadership and
provides future opportunities for incremental development
|
  5
Financials Are Attractive
Economics for operating and advanced development portfolio are attractive
EPS breakeven in 2011, accretive beginning in 2012
•
Assumes transaction is funded with 100% debt
EBITDA
run-rate
of
~$150M/year
including
PTCs
(1)
(including
Michigan
development
projects)
Free cash flow accretive by 2013
•
Includes estimated capex (before tax incentives) of $450-$500M in
2011-2012 for Michigan development projects
Expect transaction to have minimal impact on credit metrics
EPS Accretion / Dilution
0.0%
0.6%
1.5%
2011E
2012E
2013E
(1)
Production Tax Credits |
 6
6
Asset Profile –
Operating
The portfolio is largely made up of contracted operating assets
Geographic Distribution
TX, 26%
MO,
22%
MI, 17%
ID, 12%
MN,
11%
OR,
10%
KS, 2%
IL, 1%
Note:
There is ongoing litigation with Southwest Public Service related to PURPA
contracts which could impact the price at which the generation from these
units is sold. Cracking issues experienced by Deere on certain Suzlon
turbine blades have been addressed to our satisfaction.
We have factored both items into our valuation.
Project State
MW
# of Wind
Projects
Ownership
Placed in
Service
Date
PPA End
Date
Federal
Incentive
Off-Taker
Idaho
88.2
3
100%
2009/2010
2028/2030
ITC Grant
Idaho Power
Illinois
8.4
1
99%
2008
2018
PTC
Wabash Valley Power
Kansas
12.5
1
100%
2010
2030
PTC
Kansas Power Pool
Michigan
121.8
2
100%
2008
2018/2028
PTC
Wolverine Power Supply
/ Consumers Energy
Minnesota
77.7
9
94%-100%
2003/2008
2018/2028
PTC
Various
Missouri
162.5
4
99%-100%
2008
2027
PTC
Associated Electric /
MO Joint Municipal
Oregon
74.5
4
99%-100%
2009
2029
ITC Grant
PacifiCorp
Texas
189.8
12
100%
2006/2009
N/A
PTC
Southwest Public Service
Total
735.4
36 |
 7
7
Asset Profile –
Pipeline
PPAs already executed for these
projects
Development pipeline includes
wind projects ranging from 20 MW
to 300 MW
Development of projects to be
considered on a case-by-case
basis
State
Project Name
MW
MI
Michigan Wind II
90
MI
Harvest II
59
MI
Blissfield (MW IV)
81
Total
230
Projects to be developed by Exelon
Optional projects for development
Ohio
198
Michigan
40
Idaho
20
Texas
760
Maine
50
Colorado
40
Oregon
30
California
100
Total
1,238
Total
1,468 |
 8
Regulatory Approval Process
FERC approval required
DOJ antitrust approval required under the Hart-Scott-Rodino Antitrust
Improvements Act
Other than Texas, no state approval is necessary
Expect to close transaction in 4Q 2010; no material issues expected
|