Centrica plc has agreed to sell its operational Langage and South Humber Bank combined cycle gas turbine (CCGT) power stations, with a combined capacity of 2.3GW, to EP UK Investments Ltd (“EPUK”) for £318million in cash, subject to customary working capital and other completion adjustments. EPUK’s ultimate parent company, EPH, is Europe’s 7th largest power generator and owns the Eggborough and Lynemouth Power stations in the UK.
The transaction is consistent with Centrica’s strategy to shift investment towards its customer facing businesses and to seek opportunities in flexible peaking units, energy storage and distributed generation whilst reducing focus on large scale central power generation.
Centrica’s Distributed Energy & Power business was established in 2015, bringing together expertise from across the Centrica Group to provide large energy users with distributed energy solutions and combine this with our existing power generation capabilities. In December 2016 Centrica was awarded Capacity Market agreements for two fast-response gas peaking plants at Brigg and Peterborough and a battery storage facility in Cumbria. Also including the 370MW CCGT project at King’s Lynn A, Centrica is investing £180 million in new flexible energy storage and gas-fired generation capacity.
The transaction is subject to EU merger clearance and is expected to complete during the second half of 2017.
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