8Point3 Energy Partners LP has filed an 8-K with the Securities and Exchange Commission (SEC) in which it notes potential “material impairments” as a result of the FirstEnergy Solutions Corp.’s bankruptcy filing on March 31.
FirstEnergy had signed a PPA in 2011 to purchase the electricity from a 20 MW-AC solar power plant located in Washington County, Maryland. The bankruptcy filing has significantly increased the probability that the contract will be negated. Due to such events,
Management of the Partnership has determined that the carrying value of the Maryland Solar Project will incur a material impairment loss and that the Partnership will recognize such loss during the second quarter of 2018 in the amount by which the carrying value of the Maryland Solar Project exceeds the fair value of the Maryland Solar Project, or an estimated impairment in the range of $40 million to $48 million.
The project generates $8 million in annual revenue. The plant started operations at the beginning of 2013, and the PPA was for 20 years. Belelectric’s 20-year O&M proposal could be found on the Maryland Public Service Commission website.
In 8Point3’s quarterly report, just three days earlier, the company noted that FirstEnergy had seen its credit rating lowered and that bankruptcy had become a risk.
FirstEnergy recently began imploring President Trump to bail out its coal and nuclear assets, after sending a request to Energy Secretary Perry for a wide-reaching bailout of coal and nuclear power plants in PJM’s service area using emergency powers. The company has also been implicated in Secretary Perry’s failed attempt to ram a similar national bailout through the Federal Energy Regulatory Commission (FERC).
It turns out that FirstEnergy CEO Robert E. Murray had asked Perry to make such a move in a private meeting that was photographed by a DOE staff photographer. The photographer was fired for giving the photo to the press and is claiming whistleblower protection.