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New York Poised to Close Last Coal-fire Power Plant

LCG, December 4, 2019--The last operating coal-fired power plant in New York is moving toward closure shortly. Last month, Somerset Operating Company, a subsidiary of Riesling Power LLC, submitted a request to the New York State Public Service Commission (NYSPSC) to waive the state's required, 180-day notice to close the Somerset Station, allowing the facility to be retired on February 15, 2020. Closure is contingent on approvals by both NYSPSC and the New York Independent System Operator (NYISO), which will evaluate if it will cause an adverse effect on grid reliability.

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Construction Commences on Enel’s Aurora Wind Farm in North Dakota

Enel Green Power North America, Inc. (“EGPNA”), the US renewable energy company of the Enel Group, has started construction of the 299-MW Aurora Wind Farm in North Dakota.

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Industry News

Enron Says Dispute Could Cost India $5 Billion

LCG, Sept. 19, 2001--Enron Corp.'s Dabhol Power Co. said yesterday that its dispute with the Indian state of Maharashtra could end up costing the federal government of India $5 billion, because of Maharashtra's disregard for its contractual obligations.

Enron completed the first 740 megawatt phase of the Dabhol power plant near Bombay in the middle of last year and the Maharashtra State Electricity Board, the sole customer for the plant's output, immediately began dragging its feet in paying for the power it purchased.

Enron was forced to invoke first state guarantees and later federal guarantees to get paid for bills tendered in the fall of last year and early this year. The MSEB in May canceled its purchases from the plant but still owes Dabhol for a month's power. The state-owned utility said Dabhol had "violated" contractual obligations, fined the company $400 million, and grandly advised it to simply deduct the electric bill from what it owed in fines.

There was no provision for any of that in the power purchase agreement signed between Enron, Dabhol, the state of Maharashtra, the MSEB and the government of India six years ago.

The MSEB has also said it would not take power from the a,444 second phase of Dabhol, which would have been completed by now had Enron not halted construction in July. In July, Enron Chairman Kenneth Lay also said his company wanted to get out of India and would sell its 65 percent interest in Dabhol for what it had in it -- $1 billion.

In a statement released yesterday, Dabhol spokesman Jimmy Mogal said "Should this dispute be eventually resolved through the PPA-prescribed termination process, including international arbitration, the liability of (the MSEB, the government of Maharashtra and the government of India) would be approximately $5 billion."

The statement also suggested that India could avoid facing liabilities that could total $5 billion by choosing to settle the dispute by paying offshore sponsors and foreign lenders. If it did so, its liability could be less than half that amount, the statement said.

"We also believe that (foreign lenders) too may now want to exit from the project entirely, and they would want their debt of approximately $1.1 billion to be purchased as well," Dabhol said.

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