City of Rochelle Reaches Transmission Asset Purchase Agreement with NextEra Energy

City of Rochelle Reaches Transmission Asset Purchase Agreement with NextEra Energy

City of Rochelle Reaches Transmission Asset Purchase Agreement with NextEra Energy

The City of Rochelle has approved an agreement to sell its transmission facilities to NextEra Energy Transmission MidAtlantic, LLC, an indirect subsidiary of NextEra Energy, Inc. The facilities consist of approximately 20 miles of 138 kV transmission lines and associated substation facilities at Caron Road and Twombly (Substation #2).

Through Rochelle Municipal Utilities (RMU), Rochelle has operated the facilities as a transmission owner since August 1, 2015, under the tariff of PJM Interconnection LLC, a regional transmission operator. Rochelle made the decision to sell the assets so that it could focus on its core competency, which is operating its electric distribution system to serve retail customers.

According to Rochelle Mayor Chet Olson, “This transaction provides Rochelle and RMU with the best strategic opportunity going forward to service its residents and electric utility customers.” The Mayor went on to say that “all members of the council and staff are excited to work with NextEra and its personnel.”

City Manager, Jeff Fiegenschuh echoed the Mayor’s sentiment saying “This transaction allows our utility team to focus more of our time and assets on our local distribution system and service area. After all, this is what municipal electric utilities do best: provide great customer service and reliable power. Further, through this partnership, NextEra Energy Transmission MidAtlantic will be providing $20,000 per year for 10 years for community and economic development projects in our downtown area”.

The sale came about after a lengthy process, which began in July of 2017 when RMU issued a request for proposals to explore a potential strategic partnership with, or an outright sale to, a qualified transmission-focused company. After receiving numerous competitive proposals, RMU staff and its consulting team conducted interviews and engaged in extensive deliberation before choosing NextEra Energy Transmission MidAtlantic LLC as offering the best overall and long-term value to the City.

Eric S. Gleason, President of NextEra Energy Transmission, LLC said “the purchase of Rochelle’s transmission assets provides our company with a welcome opportunity to develop a close, long-term working relationship with a great municipal utility and to expand our transmission footprint.”

The transaction is still subject to state and federal regulatory approvals and the parties are working together to complete and close the transaction by the end of September, 2018.