Mass. public power agency shrinks debt for power projects

The Massachusetts Municipal Wholesale Electric Company reported that it recently paid its bondholders $45 million in principal and nearly $1 million in interest, bringing the outstanding debt on MMWEC’s power supply projects down to $10.68 million.

The public power electricity supplier, headquartered in Ludlow, Massachusetts, said that all of its power supply project debt will be retired in 2019.

The bonds for the agency’s Nuclear Project 4, which represents a 49-megawatt portion of MMWEC’s 144-megawatt ownership in the Seabrook nuclear power plant in Seabrook, New Hampshire, are now retired, MMWEC said in the summer 2017 issue of its publication, Joint Action News.

“Retirement of these bonds represents an important step towards debt-free ownership of Seabrook Station,” said MMWEC Chief Executive Officer Ronald C. DeCurzio. “The success of this power supply and financing program provides project participants with an independent public power supply and the ability to stabilize rates,” he said.

MMWEC said it has issued more than $4.7 billion in bonds since 1976 to finance and refinance its 735-MW ownership interests in several New England generating facilities, including the Seabrook plant; the Millstone 3 nuclear plant in Waterford, Connecticut; the Stony Brook power plant in Ludlow, Mass., which uses oil and natural gas; and Wyman Unit 4 in Yarmouth, Maine, which runs on oil.

Three years ago, MMWEC retired the bonds associated with a 19.6-MW ownership interest in Millstone and a 2-MW ownership interest in Seabrook. All of the MMWEC debt associated with the Stony Brook and Wyman Unit 4 plants was retired in 2008.

Through its ownership in these plants, MMWEC provides electricity to 28 Massachusetts public power utilities and six Vermont utilities.

MMWEC noted that both the nuclear power plants that it owns shares of — the Seabrook Station and Millstone 3 — are expected to operate until at least 2045, long after the debt for these plants is retired. The agency said a program is in place to extend the life of key components at the fossil fuel-fired Stony Brook plant until at least 2030, without issuing additional debt.

Payments for the principal and interest on MMWEC bonds are derived from contracts through which public power utilities agree to pay a share of MMWEC’s unit ownership costs, including the cost of debt service, unit operation and administrative expenses. In return, the utilities are entitled to receive a proportionate share of the unit’s output.

Berkshire Wind project is 6 years old

MMWEC also noted in its summer issue of Joint Action News that the Berkshire Wind Power Project recently marked six years of operation while posting a capacity factor of nearly 40 percent for the 12 months that ended on June 30.

The June 2017 capacity factor of 39.9 percent is the highest for the month of June since the project began operating, the agency said. Berkshire Wind has achieved a capacity factor of 37.4 percent since it started operating — a relatively high capacity factor for an inland wind project, MMWEC said, noting that this reflects “excellent wind conditions at the project’s home on Brodie Mountain in Hancock, Massachusetts, one of the state’s best wind sites.”

The 10-turbine, 15-MW project is operated by MMWEC and owned by the Berkshire Wind Power Cooperative, made up of MMWEC and 14 of its member public power utilities. The wind project started commercial operation in May 2011.

Last November, Fitch Ratings affirmed its A+ credit rating for the Berkshire Wind Power Project. The credit rating agency cited the financial strength and stability of the public power utilities that own the project along with MMWEC.