The Federal Energy Regulatory Commission FERC has approved Shell Energy North America’s purchase of the 596-MW Rhode Island State Energy Center in Johnston, Rhode Island, a gas-fired combined-cycle power plant.
The acquisition is part of Shell’s continued investment in the ISO New England market, where it has been operating for over 20 years. The deal is expected to close this quarter, with Shell planning to leverage its understanding of the plant’s performance to enhance its integrated gas and power business.
The Rhode Island State Energy Center, currently owned by The Carlyle Group and EGCO RISEC II, produced 3.6 million MWh of electricity in 2023.
The plant, operational since 2002, plays a crucial role in grid stabilization and energy services in the region, which serves major cities like Boston and Providence.
The acquisition is set to secure Shell’s position in the growing ISO New England market, which is projected to experience a 1.8% annual increase in electricity demand through 2033.
Shell has a tolling agreement with the power plant through the end of 2024, and the facility is committed to ISO New England through May 2028. The plant’s capacity has been successfully cleared in the region’s annual forward capacity auction.
Despite Shell’s growing involvement in the region, FERC found no competitive concerns with the deal, deeming it in line with the public interest.
Shell’s acquisition is seen as a strategic move to expand its trading portfolio and position itself for future energy transition initiatives, including the potential development of battery storage systems and hydrogen co-firing in the plant’s turbines.