3 PG&E; Power Plants to Be Sold to Duke

Duke Energy Corp. said it will purchase for $501 million three Northern and Central California power plants from Pacific Gas & Electric Co., a unit of PG&E; Corp. Eager to delve into the state’s power market, North Carolina-based Duke, a utility holding company, agreed to pay about 30% more than book value for the plants with a combined capacity of 2,645 megawatts. “These plants will give us the opportunity to blend expertise in trading and marketing electricity and gas to deliver value to California customers,” said Duke Chief Executive Richard Priory. California’s deregulation plan required PG&E; and Southern California Edison Co., a unit of Edison International, to sell half of their fossil fuel-fired power plants. Both utilities, however, decided to sell all of those assets over the next few months. The announcement marked the end of a bidding process for PG&E;’s first such asset sales, including the Morro Bay plant in San Luis Obispo County, the Moss Landing plant in Monterey County and the Oakland plant in Alameda County. PG&E; plans to sell five more plants in 1998, and Edison expects to announce the winning bids for its 12 plants toward the end of this month. The sale must be approved by the state Public Utilities Commission.