Energy Southeast, a Cooperative District, recently announced the successful closing of a $1.3 billion prepaid energy transaction on behalf of the Kansas Municipal Energy Agency (KMEA) and the Kansas City Board of Public Utilities (BPU).
"This transaction supports two long-term prepaid energy acquisitions designed to provide cost-effective energy supplies for the participating utilities," Energy Southeast noted.
The transaction was structured in two tranches, with initial prepaid energy delivery periods extending through 2033 and 2037, respectively. Energy Southeast issued the tax-exempt bonds used to finance the acquisitions, helping the participating utilities secure competitively priced energy to serve their communities.
Alabama-based Energy Southeast said it appreciated the opportunity to partner with Goldman Sachs, KMEA and BPU to bring this transaction to a successful close.
KMEA is a Kansas joint action agency, while BPU is a Kansas public power utility.
"Energy Southeast is excited to build on the success of its energy prepayment program and continue supporting public power utilities through long-term financing solutions that help lower energy costs. This is the third energy prepayment closing for Energy Southeast this year, and the eighth closing overall. These deals reflect the value of strong partnerships and a shared commitment to delivering affordable energy to the communities these utilities serve," it said.
The Kansas City BPU provided details on the transaction in September.
In other recent news involving Energy Southeast, Commissioners with Washington State’s Grant PUD recently passed a resolution authorizing an electricity prepayment transaction. The authorization also approves the execution and delivery of one or more power supply contracts, limited assignment agreements and other documents related to the purchase of electricity.
The tax-exempt power financing arrangement is expected to save Grant PUD approximately $4 million annually on its purchases of electricity from the Royal Slope Solar project, expected to be generating in early 2028.
Under the financing structure, Grant PUD will enter into an agreement with investment banker Goldman Sachs, and an intermediary -- Energy Southeast -- which will buy the power directly from the Royal Slope Solar project and resell it to Grant PUD.
As part of the transaction, Energy Southeast plans to issue tax-exempt bonds in its own name, Grant PUD noted. Energy Southeast is an Alabama-based joint action agency.
“The economics connect to the overall power purchase agreements and result in savings to Grant PUD in the form of lower power costs on solar energy purchased from Royal Slope Solar – approximately $4 million in reduced payments annually,” the PUD said.
The transaction is expected to produce approximately $43 million in energy savings to Grant PUD over 10 years and could be extended, PUD staff said.
Energy Southeast's bond issuance will not add to Grant PUD debt and Grant PUD will withdraw from the agreement if commission-approved savings are not met and go back to purchasing the power directly from Royal Slope Solar, PUD staff told the Commissioners.
