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Updated May 13

The six merchant generators with operations in California saw their net income fall, some slightly, others significantly. All have felt the impact of the pandemic and resulting drop in commercial and industrial power demand. But the companies have largely been able to keep their construction projects on track.

Calpine: Earnings declined for this Texas-based generator with substantial operations in California to $128 million compared to $175 million in net income in the first quarter of 2019. The company, which is owned by a consortium of investors, did not report per share earnings.

Commodity margins in California and the west were $234 million, compared to a total $588 million from all Calpine operations this year. That compares to the previous year of $264 million out of a total $775 million. The drop was attributed largely to lower gas prices in Southern California.

Although it has not been seriously impacted by the pandemic, it borrowed an additional $350 million in March as a precaution, of which $200 million was repaid as mid-May. “As the impact of the COVID-19 outbreak on the economy and our operations evolves, we will continue to assess and manage our liquidity needs,” the company stated May 13.

Calpine owns the 725 MW Geysers geothermal farm in Sonoma County, plus 19 gas fired plants and three cogeneration plants in the Golden State. Several them operate under power purchase agreements with Pacific Gas & Electric.

To date, the agreements with PG&E have been upheld but Calpine noted all bets are off after June 30 as it “cannot predict the ultimate outcome” of the bankruptcy.

AES: This Virginia-based global generator saw a slight drop in first quarter earnings of $229 million, or 22 cents a share. That compares to $233 million, or 23 cents a share, at the end of the first three months of 2019.

The company saw commercial and industrial demand drop by 15%, offset a bit by an increase in residential demand.

Covid-19 is expected to cause a 5% decrease in adjusted earnings per share this year for AES. Effects will be “modest in the near-term impact,” on 2020 earnings because the company is in “the strongest financial position in our company's history,” Andres Gluski, president and chief executive officer, said May 7. AES has $3.3 billion in available liquidity and no “significant” near term debt due.

AES also reported recently completing major projects. The biggest ones to come online the latest quarter were the repowered 650 MW Huntington Beach and 650 MW Alamitos Energy combined-cycle gas turbine projects, the latter in Long Beach.

AltaGas: This Canadian energy company reported net income for the first quarter at $464 million, or $1.66 per share, a reduction from last year of almost half. First quarter earnings in 2019 were $809 million, or $2.93 share.

Much of the drop was attributed to the lack of a gain on the sale of its remaining interest in the Northwest Hydro facilities, unlike the first quarter of 2019.

Covid‐19 and its fallout has led to falls in demand, causing gas prices to drop.

AltaGas’ capital investment program was reportedly on track despite the pandemic. Much of that work is pipeline replacement, which has reduced gas leaks by 19% and cut costs by $6 million year over year, Randy Crawford, company president and chief executive officer, said April 30.

Its California operations include the 50 MW Rippon facility and 507 MW Blythe natural gas-fired generating station. AltaGas holds a two-and-a-half-year tolling agreement with Southern California Edison for Blythe, running to the end of 2023. Edison has exclusive rights to all capacity, energy, ancillary services, and resource adequacy benefits produced by the Blythe station.

Altagas also has a 20 MW/80MWh lithium ion battery storage project in Pomona, which is under a 10-year contract with Edison through to 2027. Queries about the status of its proposed 60 MW stand-alone storage project in Goleta, in Santa Barbara County, were left unanswered.

NextEra Energy Resources: This Florida-based company, with substantial wind, solar, and battery energy storage facilities in California, saw its first quarter net income decline a bit to $318 million, or 65 cents a share. That compares to $321 million, or 67 cents per share, in the first quarter of 2019.

“At NextEra Energy Resources, we continue to believe the market opportunity for low-cost renewables has never been greater,” NextEra CEO Jim Robo said during an April 22 earnings presentation. The company added 1,600 MW of renewables—600 MW of wind, 420 MW of solar, 457 MW of battery storage and 113 MW of repowered wind. It plans to invest more than $1 billion in storage projects next year. That includes a 440 MWh facility at its 131 MW Arlington, CA solar plant. It also plans to have online a second 233 MW Arlington solar plant. A 5 MW storage facility is being planned to connect with its 50 MW Proxima solar plant.

The pandemic is not expected to hamper the online dates of the company’s 2020 renewables construction projects.

NRG: The company’s first quarter earnings fell to $121 million, or 49 cents a share. That contrasts to reported earnings a year earlier of $482 million, or $1.73 million a share. A small portion of its income is generated from California operations.

The lower earnings were attributed to higher nuclear plant costs and a big drop in commercial and industrial demand. The company, which provides retail and wholesale power in Texas, the Midwest, East and California, saw demand fall across its installations: a 9% drop in the California Independent System Operator market to as little as a 2% decline in ERCOT.

The pandemic caused the halting of non-essential projects, including demolition work at the Encina coastal plant.

The previous two years, the company sold off about $3 billion of its assets, including renewable plants in and outside California. It also initiated a share repurchase program, buying back 224 million shares, currently totaling $60 million in purchases.

NRG’s facilities in, or serving, California include the 252 MW Long Beach gas plant, 226 MW Midway Sunset gas plant, 586 MW Sunrise gas facility, and the 204 MW Watson cogeneration projects. It also owns a 54% interest in the 393 MW solar Ivanpah project, and the Aqua Caliente solar plant in Arizona, both of which are under contract with PG&E. Their fate is tied up in the PG&E bankruptcy court proceeding.

Vistra : The company, which provides wholesale and retail power to the East, Midwest, Texas, and California, reported lower earnings of $45 million. That is significantly below $224 million in net income it reported the first quarter of 2019.

Of its $850 million in ongoing operating revenue, only $19 million was from the California Independent System Operator’s market.

Vistra owns two fossil-fired gas plants in the Golden State, the 1,020 MW Moss Landing facility and 165 MW Oakland plant. The Moss Landing plant provides resource adequacy; 1,020 MW this year and next year. It then drops to 556 MW in 2022. The company is building a 300-MW/1,200 MWh battery energy storage system at Moss Landing along the Central Coast. An expanded battery storage project of 36 MW/145 MWh is being built at the Oakland plant, which is to come online in January. The previous planned capacity was 20 MW/80 MWh.

Editor’s Note: The companies report earnings differently so an apples to apples comparison is not possible.

The story was updated May 13 to incorporate Calpine's earnings quietly released that day.

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