Atlantic Power Corporation Executes New Agreement at Oxnard for 2022 and 2023

Rhea-AI Summary

Atlantic Power Corporation (NYSE: AT) announced a new agreement on March 31, 2021 to sell capacity from its Oxnard plant for two additional years, from January 1, 2022 to December 31, 2023. The 49 MW gas-fired plant will continue under a Resource Adequacy agreement, providing fixed monthly capacity payments and potential revenue from energy sales. The new capacity payment is modestly higher than 2021. The Company anticipates a similar level of Project Adjusted EBITDA for 2022 and 2023 as in 2021.

Positive

• New agreement extends capacity sales for Oxnard through 2023.
• Capacity payment for 2022 and 2023 is modestly higher than in 2021.
• Continues to provide reliable generation, supporting renewable energy integration.

Negative

• None.

DEDHAM, Mass., April 1, 2021 /PRNewswire/ -- Atlantic Power Corporation (NYSE: AT) (TSX: ATP) ("Atlantic Power" or the "Company") announced today that on March 31, 2021, it executed a new  agreement to sell capacity from the Oxnard plant for an additional two years, effective January 1, 2022 through December 31, 2023.

Oxnard is an approximately 49 megawatt gas-fired plant located in Oxnard, California. The plant is currently operating under a Resource Adequacy (RA) agreement through December 31, 2021. Under this agreement, which satisfies the load obligations of a community choice aggregator, Oxnard receives a fixed monthly capacity payment and has the opportunity to receive revenue from the potential sale of energy and ancillary services.

The new RA agreement for 2022 and 2023 will satisfy the load obligations of a different entity than the current one. Oxnard will continue to receive fixed monthly capacity payments and potentially earn revenue from the sale of energy and ancillary services. The capacity payment is modestly higher than the level in place for 2021. The Company expects a modest level of Project Adjusted EBITDA from Oxnard in 2022 and 2023, similar to the level expected for 2021.

"The requirement for firm and reliable generation to support the further integration of intermittent renewable resources makes this new agreement for Oxnard possible," said Joe Cofelice, Executive Vice President—Commercial Development of Atlantic Power. "We believe this new two-year agreement to sell capacity through 2023 is a further indication of the value of the Oxnard plant in the California market."

About Atlantic Power

Atlantic Power is an independent power producer that owns power generation assets in eleven states in the United States and two provinces in Canada. The Company's generation projects sell electricity and steam to investment-grade utilities and other creditworthy large customers predominantly under long–term PPAs that have expiration dates ranging from 2021 to 2043. The Company seeks to minimize its exposure to commodity prices through provisions in the contracts, fuel supply agreements and hedging arrangements. The projects are diversified by geography, fuel type, technology, dispatch profile and offtaker (customer). Approximately 75% of the projects in operation are 100% owned and directly operated and maintained by the Company. The Company has expertise in operating most fuel types, including gas, hydro, and biomass, and it owns a 40% interest in one coal project. 

Atlantic Power's shares trade on the New York Stock Exchange under the symbol AT and on the Toronto Stock Exchange under the symbol ATP. For more information, please visit the Company's website at www.atlanticpower.com or contact:

Atlantic Power Corporation 
Investor Relations
(617) 977-2700 
info@atlanticpower.com

Copies of the Company's financial data and other publicly filed documents are available on SEDAR at www.sedar.com or on EDGAR at www.sec.gov/edgar.shtml under "Atlantic Power Corporation" or on the Company's website.

Cautionary Note Regarding Forward-Looking Statements

To the extent any statements made in this news release contain information that is not historical, these statements are forward-looking statements within the meaning of Section 27A of the U.S. Securities Act of 1933, as amended, and Section 21E of the U.S. Securities Exchange Act of 1934, as amended, and under Canadian securities law (collectively, "forward-looking statements").

Certain statements in this news release may constitute forward-looking information or forward-looking statements within the meaning of applicable securities laws (collectively, "forward-looking statements"), which reflect the expectations of management regarding the future growth, results of operations, performance and business prospects and opportunities of the Company and its projects. These statements, which are based on certain assumptions and describe the Company's future plans, strategies and expectations, can generally be identified by the use of the words "plans", "expects", "does not expect", "is expected", "budget", "estimates", "forecasts", "targets", "intends", "anticipates" or "does not anticipate", "believes", "outlook", "objective", or "continue", or equivalents or variations, including negative variations, of such words and phrases, or state that certain actions, events or results, "may", "could", "would", "should", "might" or "will" be taken, occur or be achieved. Examples of such statements in this press release include, but are not limited to, statements with respect to the following:

• the Company's expectation for Project Adjusted EBITDA from the Oxnard plant under the RA agreement in 2021, 2022 and 2023; and
• the Company's assessment of market conditions in California.

Forward-looking statements involve significant risks and uncertainties, should not be read as guarantees of future performance or results, and will not necessarily be accurate indications of whether or not or the times at or by which such performance or results will be achieved.  Please refer to the factors discussed under "Risk Factors" and "Forward-Looking Information" in the Company's periodic reports as filed with the U.S. Securities and Exchange Commission (the "SEC") from time to time for a detailed discussion of the risks and uncertainties affecting the Company.  Although the forward-looking statements contained in this news release are based upon what are believed to be reasonable assumptions, investors cannot be assured that actual results will be consistent with these forward-looking statements, and the differences may be material.  These forward-looking statements are made as of the date of this news release and, except as expressly required by applicable law, the Company assumes no obligation to update or revise them to reflect new events or circumstances.

 

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SOURCE Atlantic Power Corporation

FAQ

What is the new agreement for Atlantic Power's Oxnard plant?

Atlantic Power Corporation announced a new agreement on March 31, 2021, to sell capacity from its Oxnard plant for an additional two years, from January 1, 2022, through December 31, 2023.

How much capacity does the Oxnard plant generate?

The Oxnard plant generates approximately 49 megawatts of power.

What are the financial expectations for Atlantic Power from the Oxnard plant?

The company expects a modest level of Project Adjusted EBITDA from the Oxnard plant in 2022 and 2023, similar to that anticipated for 2021.

When does the new Resource Adequacy agreement for Oxnard start?

The new Resource Adequacy agreement for the Oxnard plant starts on January 1, 2022.

What is the significance of the Oxnard plant's agreement for Atlantic Power?

The agreement is significant as it provides fixed monthly capacity payments and the potential for additional revenue from energy sales, enhancing the plant's value in the California market.