Clean Energy, Macquarie Told to Mediate Dispute
WARREN, Ohio – A court decision on whether to enforce an option-to-purchase agreement that would allow Clean Energy Future LLC to build a second $900 million electrical generation plant in Lordstown will have to wait.
The majority owners of the Lordstown Energy Center, now under construction at the Lordstown Industrial Park along Henn Parkway, have filed an appeal with the 11th District Court of Appeals to decide whether real estate matters should be determined through the court or through arbitration.
“That’s going to take some time to work through the system,” said Bill Siderewicz, president of Clean Energy Future. “They want it resolved in arbitration and we don’t agree with that.”
Judge Peter Kontos was to hear arguments this morning on whether to enforce an option-to-purchase agreement signed in 2016 by Clean Energy Future LLC and Macquarie Group, the majority owner of the Lordstown Energy Center.
Clean Energy Future wants to build a second electrical generation plant – the Trumbull Energy Center – on land next to the Lordstown plant that Macquarie owns. However, Macquarie has refused to relinquish the property, citing future conditional uses it might have for the site.
Macquarie also has said there are potential losses that it would incur should a second plant be built there, according to previous testimony.
Instead of proceeding with the hearing, Kontos called attorneys from both parties into his chambers to discuss other options.
Kontos told the attorneys it appeared the parties were close to a resolution during previous mediation sessions, but there were several issues that still needed addressed, Siderewicz related.
“He said rather than waste time waiting for the court, we could accelerate this thing if you could come back in here and somehow push those four or five issues over the finish line,” he said.
No schedule or timeline has been established yet, Siderewicz said, but added that any mediation sessions would occur sometime in mid-September.
“The good news if the other side is sincere about it, you could eliminate all this madness and get to the finish line,” Siderewicz said. “So, there is an upside.”
Clean Energy Future filed suit against Macquarie late last year asking the court to enforce the option-to-purchase agreement without any conditions. The court has already sided with Clean Energy, ordering Macquarie to sign an addendum that would remove restrictions from the industrial park in order to construct the second plant.
Siderewicz was responsible for developing the Lordstown Energy plant and then sold it to Macquarie – which holds a 70% stake in the venture. Siemens Energy holds a 25% position and Clean Energy still has a 5% interest in the project.
The Lordstown Energy Center has employed hundreds of tradesmen during the construction phase and a second plant would have the same impact on the community, Siderewicz said.
Combined cycle electrical plants are fueled by less expensive natural gas and steam rather than coal. Siderewicz said these smaller plants represent the future of energy as other utilities shut down their nuclear and obsolete coal-fired plants.
For example, FirstEnergy has announced it would close its Davis-Besse and Perry nuclear power plants in Ohio by 2021, the same year the Trumbull Energy plant would come online.
Other electrical generation companies have moved into the Ohio region as well. On Thursday, Advanced Power announced it had closed financing on a $1.3 billion combined-cycle plant near Wellsville. A combined-cycle plant in Carroll County was recently commissioned, while another natural gas-fueled power plant is under construction in Lawrence County, Pa.
Massachusetts-based Clean Energy has said in court filings that Macquarie has intentionally delayed the second project, thereby driving up costs. Should the issue not be resolved, Siderewicz said that the company would pursue a jury trial and sue for damages in excess of $100 million.
“I think both sides would want this done quickly,” Siderewicz said.
Copyright 2024 The Business Journal, Youngstown, Ohio.