ESCANABA - The sale of Escanaba's power plant is getting closer to reality - the buyer expects to close on its loan possibly by next week.
Escanaba Green Energy (EGE) President Charles Detiege said the company received the terms of a $36.5 million loan with Centurion late Tuesday night. EGE is buying the plant for $4 million and converting it to burn biomass.
"The terms are acceptable," Detiege told city council and the Electrical Advisory Committee during a special meeting Wednesday.
Detiege noted there are six minor language items to be clarified to make sure EGE and its lender have a clear understanding of the contract.
The two parties plan to discuss the items on Friday, he said, anticipating the signing of the loan could possibly take place early next week. At that point, EGE and the city could begin to coordinate a closing date on the sale of the plant.
"We were excited to get the terms and the conditions of the loan," said Detiege after the meeting, explaining money has been allocated for the loan which just needs to be signed so the sale process can go through with the city.
"We're really excited to get this done," he added.
While EGE is on standby mode until the loan is finalized and the plant sale is a done deal, the company does have its bank, insurance companies, and other necessary agencies in line and ready to go, Detiege said.
He anticipates a possible sale closing by the end of the month or beginning of October.
City Manager Jim O'Toole says it may take more time than that. O'Toole explained notices have to be submitted to ProEnergy - the current plant operator, and to the Midwest Independent Transmission System Operator, Inc. (MISO) - a regional interconnection agency which regulates power sales.
Once the money from EGE is in hand, the city will do what it can to finalize the plant sale as quickly as possible, O'Toole added.
Detiege said after the sale is complete, contractors will be brought in to begin the construction process. The conversion of the plant to burn biomass is anticipated to take about 14 months, he said.
Escanaba is selling the facility and property because it is less costly to buy power from a supplier compared to making energy by burning coal. The plant continues to be available to generate electricity for the regional power market.