Terre Haute-based Hallador Energy Co.’s (Nasdaq: HNRG) subsidiary Hallador Power has completed the acquisition of Hoosier Energy’s 1-Gigawatt Merom Generating Station in Sullivan County. The deal, which was first announced in February, includes a 3.5-year power purchase agreement in which Hoosier Energy will purchase energy produced at the coal-fired plant.
Bloomington-based Hoosier Energy will purchase 100% of the energy produced at the plant through May 2023, then reduce purchases to 22% of energy output and 32% of its capacity beginning in June 2023 and through 2025.
“This transaction provides Hallador the opportunity to be an integral part of the much needed capacity, reliability and resiliency the grid needs in the near term, while creating a pathway and structure to convert the facility to renewable energy when market signals and evolving grid infrastructure indicate it is time,” said Hallador Energy CEO Brent Bilsland. “The acquisition of Merom is exciting for Hallador shareholders as it is the beginning of a more diversified and growing earnings platform that we will continue to build upon.”
The companies’ existing PPA, which was signed in 2021 and represents 150 MW of solar generation and 50 MW of battery storage, will be retained.
“Hoosier Energy and its member distribution cooperatives benefit significantly from this agreement, providing short- and long-term cost savings and continued stability during the transition of our resource portfolio,” said Hoosier Energy CEO Donna Walker. “Current Merom employees and Sullivan County benefit as well, preserving more than 100 jobs and a major economic driver for the area.”
Financial terms of the deal were not disclosed.