Buyer in National Grid deal no stranger to N.H.
National Grid has announced the sale of its two New Hampshire electric and natural gas facilities to Canadian-based Algonquin Power and Utilities Corp., for $285 million. Based in Oakville, Ontario, Algonquin owns and operates renewable and thermal energy facilities throughout North America, including some already in New Hampshire and New England. The sale of Granite State Electric and EnergyNorth Natural Gas Inc. to Liberty Energy, a unit of Algonquin, is expected to be completed in the second half of 2011. Regulatory assets of Granite State Electric and EnergyNorth at closing are expected to total $72 million and $178.8 million respectively, said Algonquin. “As we look to expand our regulated utility business, one of the key criteria that we look at is the regulatory environment,” Algonquin CFO David Bronicheski told NHBR. “We do find the New Hampshire regulatory environment is attractive to us, and find that it is among the most credit supportive of the regulatory environments in the U.S.” Earlier in the year, National Grid said the regulatory climate in New Hampshire was “not conducive” to the climate expected by its customers and shareholders, said David Graves, a spokesman for National Grid. That's when the company decided it wanted to shed its two New Hampshire units. Algonquin already owns several hydroelectric facilities in New Hampshire, including Gregg Falls on the Piscataquog River in Goffstown; Mine Falls on the Nashua River in Nashua; as well as facilities on the Salmon River in Milton, the Suncook River in Pembroke, and several on the Winnepesaukee River, including Lochmere, Tilton, Franklin and Lakeport. This is the company's largest purchase in the state to date. British-based National Grid has a scattered presence in the Granite State, with 43,000 electric customers around Salem and Lebanon and close to 85,000 natural gas customers in parts of Hillsborough, Merrimack and Belknap counties. Algonquin will retain all employees and potentially add more, said Bronicheski.“One of the hallmarks of the way we approach utilities, we typically have a record of expanding the number of employees in the areas that we serve,” said Bronicheski. “We like to answer the calls and respond to customers locally.” New Hampshire accounts for about 2 percent of National Grid’s U.S. business, said Graves. After announcing National Grid might pull out of the state, a number of utilities contacted the company, including Algonquin, said Graves. After what Bronicheski described as a “competitive process,” the sale was signed on Dec. 8 and is pending approval by the federal regulatory energy commission. Bronicheski said APUC already owns approximately $300 million in regulatory assets and $200 million in regulated water utilities in the United States. Bronicheski also said expansion by Algonquin in the Granite State is not off the books. “We’re very familiar with the state,” said Bronicheski. “Once we have an established footprint, we’re always looking for opportunities that may exist in the area.” -- KATHLEEN CALLAHAN/NEW HAMPSHIRE BUSINESS REVIEW