The AES Corporation (NYSE: AES) today (April 18) announced an agreement to terminate the Power Purchase Agreement (PPA) for its 205 MW Warrior Run coal-fired power plant in Maryland. The offtaker, Potomac Edison, a subsidiary of FirstEnergy Corp., agreed to terminate the PPA for a total consideration of $357 million, subject to approval by the Maryland Public Service Commission (PSC). If approved, the early termination of the PPA is forecasted to save Potomac Edison's customers nearly $80 million over the next seven years, and will help the State of Maryland achieve its decarbonization targets.
"This agreement is another milestone in our journey toward decarbonization," said Andrés Gluski, AES President and Chief Executive Officer. "Following the contract termination, we see interesting opportunities to repurpose the Warrior Run site for low carbon solutions that continue to serve local communities."
Under the terms of the agreement, AES will continue to operate the Warrior Run plant through at least May 2024. AES will work with existing employees to manage a responsible transition. AES will maintain full operational control of the site following decommissioning.
About AES
The AES Corporation (NYSE: AES) is a Fortune 500 global energy company accelerating the future of energy. Together with our many stakeholders, we're improving lives by delivering the greener, smarter energy solutions the world needs. Our diverse workforce is committed to continuous innovation and operational excellence, while partnering with our customers on their strategic energy transitions and continuing to meet their energy needs today. For more information, visit www.aes.com.
Safe Harbor Disclosure
This news release contains forward-looking statements within the meaning of the Securities Act of 1933 and of the Securities Exchange Act of 1934. Such forward-looking statements include, but are not limited to, those related to future earnings, growth and financial and operating performance. Forward-looking statements are not intended to be a guarantee of future results, but instead constitute AES' current expectations based on reasonable assumptions. Forecasted financial information is based on certain material assumptions. These assumptions include, but are not limited to, our expectations regarding accurate projections of future interest rates, commodity price and foreign currency pricing, continued normal levels of operating performance and electricity volume at our distribution companies and operational performance at our generation businesses consistent with historical levels, as well as the execution of PPAs, conversion of our backlog and growth investments at normalized investment levels, rates of return consistent with prior experience and the COVID-19 pandemic.
Actual results could differ materially from those projected in our forward-looking statements due to risks, uncertainties and other factors. Important factors that could affect actual results are discussed in AES' filings with the Securities and Exchange Commission (the "SEC"), including, but not limited to, the risks discussed under Item 1A: "Risk Factors" and Item 7: "Management's Discussion & Analysis" in AES' 2022 Annual Report on Form 10-K and in subsequent reports filed with the SEC. Readers are encouraged to read AES' filings to learn more about the risk factors associated with AES' business. AES undertakes no obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except where required by law.
Any Stockholder who desires a copy of the Company's 2022 Annual Report on Form 10-K filed March 1, 2023 with the SEC may obtain a copy (excluding the exhibits thereto) without charge by addressing a request to the Office of the Corporate Secretary, The AES Corporation, 4300 Wilson Boulevard, Arlington, Virginia 22203. Exhibits also may be requested, but a charge equal to the reproduction cost thereof will be made. A copy of the Annual Report on Form 10-K may be obtained by visiting the Company's website at www.aes.com.
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Investor Contact: Susan Harcourt 703-682-1204
Media Contact: Stephanie Cathcart 571-294-6824
