(Reuters) - Exelon Corp’s EXC.N ExGen Texas Power LLC unit on Tuesday filed for Chapter 11 bankruptcy protection after struggling to cope with massive swings in energy prices.
Exelon said it would pay ExGen lenders $60 million to retain and operate the Handley Generating Station after it goes through a competitive bidding process and is approved by the court.
The remaining four ExGen plants will be owned by lenders, who are giving up their debt for equity, Exelon said. (bit.ly/2zkZwOx)
Sources told Reuters in March that Exelon hired a debt restructuring adviser to help it evaluate options for the subsidiary.
Natural gas prices have been under pressure due to oversupply and warm weather in the northeastern United States, which have driven down electricity prices, in turn hurting power plants’ profits.
Increased use of renewable energy has also negatively affected power plants that run on fossil fuels.
The bankruptcy was filed in the United States Bankruptcy Court for the District of Delaware.
Reporting by Ahmed Farhatha in Bengaluru; Editing by Anil D'Silva