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Industrial Investor To Increase Stake In Parent Of Retail Supplier

December 22,2017



Calpine Corporation (“Calpine”), on behalf of its subsidiaries that are “public utilities” under Section 201 of the Federal Power Act (the “Calpine Public Utilities”), and Access Industries, Inc. (“Access”) (together “Applicants”) sought FERC approval of Access’s election to expand its existing governance rights in Volt Parent, LP (“Volt Parent”) (“Proposed Transaction”).

As previously reported, Volt Parent, currently a wholly-controlled subsidiary of ECP ControlCo, LLC (“ECP”), has entered into an agreement to acquire Calpine, and that proposed acquisition is currently under review by FERC in Docket No. EC17-182-000 (the “ECP/Calpine Transaction”).

Access is a New York corporation and a privately held, U.S.-based industrial group focused on strategic investments in a variety of industry sectors, including natural resources and chemicals. Access is under the exclusive control of a single, natural person, who holds and manages the interests in Access. Access’s relevant subsidiaries and affiliates, including Equistar Chemicals, own or control generation facilities located in the MISO and Electric Reliability Council of Texas (“ERCOT”) markets.

Currently, Access is a limited partner in Volt Parent with an ownership interest that is passive consistent with FERC precedent. However, following the close of the ECP/Calpine Transaction and subject to receipt of necessary regulatory approvals, Access intends to exercise an option to expand its governance rights in Volt Parent, such that it may no longer be considered passive under FERC’s precedent.

More specifically, Access may elect to expand its existing governance rights in Volt Parent such that Access will convert its passive interest of approximately 13.8% in Volt Parent to an active interest under the Commission’s precedent.

Accordingly, Applicants are conservatively assuming that the Proposed Transaction will result in an indirect transfer of control over the Calpine Public Utilities and that the Calpine Public Utilities will become affiliated with Access and its subsidiaries (as Access will be an upstream owner of Calpine and the Calpine Public Utilities). To be clear, the Proposed Transaction is separate and distinct from the ECP/Calpine Transaction and would occur only following the consummation of that transaction. Further, the ECP/Calpine Transaction is not dependent on the Proposed Transaction.

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