21 June 2017
(“Centrica” or ‘the Company’)
Centrica to sell Langage and South Humber Bank gas-fired power stations
Centrica plc has agreed to sell its operational Langage and South Humber Bank combined cycle gas turbine (CCGT) power stations, with a combined capacity of 2.3GW, to EP UK Investments Ltd (“EPUK”) for £318million in cash, subject to customary working capital and other completion adjustments. EPUK’s ultimate parent company, EPH, is Europe’s 7th largest power generator and owns the Eggborough and Lynemouth Power stations in the UK.
The transaction is consistent with Centrica’s strategy to shift investment towards its customer facing businesses and to seek opportunities in flexible peaking units, energy storage and distributed generation whilst reducing focus on large scale central power generation.
Centrica’s Distributed Energy & Power business was established in 2015, bringing together expertise from across the Centrica Group to provide large energy users with distributed energy solutions and combine this with our existing power generation capabilities. In December 2016 Centrica was awarded Capacity Market agreements for two fast-response gas peaking plants at Brigg and Peterborough and a battery storage facility in Cumbria. Also including the 370MW CCGT project at King’s Lynn A, Centrica is investing £180 million in new flexible energy storage and gas-fired generation capacity.
The transaction is subject to EU merger clearance and is expected to complete during the second half of 2017.
Notes to Editors
1. EP UK Investments is a 100 per cent subsidiary of EP Power Europe, a.s. and EP Power Europe is a 100 per cent subsidiary of Energeticky a prumyslovy holding, a.s. (EPH), a company incorporated in the Czech republic. In the UK EPH own Eggborough and Lynemouth power stations and the Eggborough CCGT development project.
2. Centrica’s Distributed Energy & Power business was established in 2015 as a new global business unit with a focus on helping businesses and other large energy users to take control of their energy.
3. Langage and South Humber Bank employ approximately 130 people who will be consulted regarding potential transfer to the new operator.
4. Following the transaction Centrica’s remaining gas-fired power generation assets will consist of its smaller Barry (235MW), Peterborough (220MW), Brigg (99MW) operational assets and the Kings Lynn A construction project (370MW). Centrica is also currently building a 49MW battery storage facility at Roosecote in Cumbria and two 50MW fast response distributed generation gas-fired plants at Brigg in North East Lincolnshire and Peterborough in Cambridgeshire.
5. Centrica retains a 20% equity share in the 16 reactors in the UK nuclear fleet giving Centrica rights to 20% of a total output of almost 9,000MW and continues to retain power offtake rights from Spalding power station under a tolling agreement until 2021.
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