DALLAS--(BUSINESS WIRE)--Officials from across Pennsylvania joined Panda Power Funds today in commissioning the nation’s first power plant designed to take advantage of abundant U.S. natural gas reserves discovered in the Marcellus Shale. Access to the region’s low-cost natural gas is expected to provide the 829 megawatt Panda “Liberty” generating station with a significant operating cost advantage. The combined-cycle facility will provide power for up to one million homes and is located in Bradford County, Pennsylvania.
The commissioning of the state-of-the-art plant is part of a national trend away from coal-fired to natural gas-fueled generation. The discovery of massive deposits of natural gas in shale basins — such as the Marcellus — has driven down the price, and price volatility, of natural gas. At the same time, the implementation of strict air emission standards has driven up the cost of environmental compliance for competing coal-fired generation. As a result, much of the nation’s 350,000 megawatts of coal-fired generation is at risk of early retirement.
Calling Pennsylvania “the front line of an American energy revolution,” Todd Carter, senior partner and chief executive officer of Panda Power Funds, encouraged those in attendance to continue to responsibly develop the region’s shale gas deposits. “Few things are as important in a dangerous and uncertain world than having a reliable supply of domestically produced, clean and affordable energy,” stated Carter. “Bradford County isn’t just supplying natural gas, or electricity, to the marketplace — but energy security to the nation.”
Environmental Benefits
The state-of-the-art Liberty generating facility will utilize the latest, most advanced emissions-control technology, making it one of the cleanest natural gas-fueled power plants in the nation. In addition, unlike approximately 95 percent of the nation’s generating facilities, the plant is cooled with air rather than water. As a result, the Panda Liberty plant does not draw water from, or discharge water into, the Susquehanna River — eliminating potential impacts to species in the Susquehanna watershed. Special blade designs, low-output motors and building enclosures were also used to help minimize sound.
The Liberty plant also utilizes Siemens H-class gas turbines — the world’s first generation technology designed to achieve operating efficiencies of 60 percent. Liberty is the first plant in the United States to use Siemens’ H-Class gas turbines in a very efficient single shaft configuration.
The generating facility is consequently expected to displace generation from coal-fired power plants which are much less efficient and environmentally friendly. Accordingly, the Panda Liberty plant will produce about 60 percent less carbon dioxide than a comparably sized coal-fired facility, or the equivalent of taking approximately 350,000 cars off the road for an entire year. SO2 and NOX emissions will also be reduced by more than 90 percent, and mercury emissions will be virtually eliminated when compared to a plant fueled by coal.
Pennsylvania Job Creation and Economic Benefits
According to an economic impact study conducted by Impact Data Source of Austin, Texas, the Panda Liberty plant will contribute an estimated $5.97 billion to the area’s economy in the now-past construction phase and the facility’s first 10 years of operation. More than 1,000 jobs were created to construct the Liberty power plant with approximately 650 at peak construction. Twenty-seven full-time employees currently operate the facility, and forty-five indirect jobs are expected to be created within the community to support the plant during operations.
Equally important, in a region largely devoid of pipeline infrastructure, the Panda Liberty generating station is helping to create a long-term market for local royalty owners whose natural gas holdings are otherwise trapped.
Financing
Goldman Sachs, Credit Suisse, Ares Capital, MUFG Union Bank and Investec arranged the senior debt financing for the plant. The transaction marked the fourth financing of a large-scale power facility by Panda Power Funds in 13 months and the first investment of Panda Fund II. The fund supplied equity for the Liberty project along with a large institutional co-investor.
Construction
Gemma-Lane Liberty Partners served as the project EPC Contractor and Siemens Energy Inc. provided the power island package including the natural gas turbines, steam turbine and waste heat recovery boilers. Gemma-Lane Liberty Partners was responsible for installing the power island equipment and for the engineering, procurement and installation of the balance of the plant, and the commissioning of the facility. Construction began in August of 2013 and took approximately 32 months.
Panda Power Funds has also built a “sister” generating facility, the 829 MW Patriot combined-cycle power plant outside of Williamsport which entered commercial service approximately two months after the Liberty plant. Panda is also building the 1,124 MW Hummel Station plant, in Sunbury, Pennsylvania, which is one of the largest coal to natural gas power replacement projects in the country.
About Panda Power Funds, LP
Founded in 2010, Panda Power Funds is a private equity firm headquartered in Dallas, Texas, that develops, owns, operates and manages investments in clean energy. Panda has five combined-cycle power plants in operation in Texas and Pennsylvania, and two combined-cycle power plants currently under construction in Pennsylvania and Virginia with a combined capacity of more than 5,800 megawatts. Panda Power Funds also has a 990 megawatt power project in Maryland in advanced development. The fund built a 20 megawatt solar farm in southwest New Jersey that is one of the largest solar facilities in the Northeast United States. Additional information on Panda Power Funds can be found at www.pandafunds.com.
