Shell Energy North America (SENA), a subsidiary of Shell, has agreed to acquire Rhode Island State Energy Center (RISEC), the owner of a 609MW combined-cycle gas turbine (CCGT) power plant located in Rhode Island, US.
RISEC is majority-owned by funds managed by the global investment firm Carlyle with 51% stake. The remaining 49% stake in the holding company is held by EGCO RISEC II, a subsidiary of Thailand-based Electricity Generating Public Company (EGCO).
Located outside Providence, RISEC’s two-unit CCGT power plant has an average operating capacity of 594MW. The facility commenced operations following its completion in 2002.
The American CCGT plant provides electricity to the ISO New England market, where demand is anticipated to rise due to increasing decarbonisation efforts in sectors such as transportation and home heating.
Through the proposed deal, Shell will secure long-term supply and capacity offtake in the deregulated Independent System Operator New England (ISO New England) power market.
Shell Energy North America has held an energy conversion agreement with RISEC since 2019 in ISO New England, securing 100% of the plant’s energy offtake.
In addition, the acquisition will enable SENA to maintain its current operations and reduce market risk by guaranteeing a reliable and stable power generation source.
Furthermore, the transaction is expected to generate an internal rate of return (IRR) exceeding the hurdle rate set for Shell’s power business.
Shell downstream, renewables and energy solutions director Huibert Vigeveno said: “Shell has had a successful integrated gas and power business in the growing ISO New England market for over 20 years, and this acquisition secures valuable trading opportunities by guaranteeing SENA’s position in the market.
“Our strong understanding of this plant’s performance positions Shell to capitalise on its value within our existing trading portfolio.”
The transaction, which is expected to close in Q1 2025 following regulatory approvals, will be absorbed within Shell’s existing cash capital expenditure framework, without any change to its guidance.
Earlier in August this year, Shell Deutschland selected Linde Engineering to build a 100MW renewable hydrogen plant for the REFHYNE II project at the Shell Energy and Chemicals Park Rheinland in Wesseling, Germany.
