A controversial US independent power producer has announced it has closed on a zero-carbon letter of credit (L/C) facility in its attempts to restore its fortunes after its forerunner filed for bankruptcy amidst what has become known as the Ohio nuclear bribery scandal.

Energy Harbor says RBC Capital Markets (RBC) and Goldman Sachs acted as joint book runners and joint lead arrangers for the new zero-carbon L/C facility, with global investment bank RBC acting as administrative agent. The company has not divulged the value of the facility.

L/C pricing and benefits

The facility is priced with an L/C issuing fee of 150 basis points and is backed by the company's carbon-free baseload nuclear fleet as well as the company's growing retail and commercial energy businesses according to an Energy Harbor statement.

Its senior vice president and treasurer, Tanya Rohauer, says the transaction will allow the power producer to continue improving its financial position and pursue further growth in its core markets.

Bribery and bankruptcy

Energy Harbor emerged from the Chapter 11 bankruptcy proceedings of Ohio-based coal and nuclear power generating company, FirstEnergy Corp. The new company is expected to get more than US$1 billion from Ohio ratepayers to bail out its Davis-Besse and Perry nuclear plants in Northern Ohio.

Some of the US state's most prominent political figures were accused earlier this year of accepting US$60 million in bribes to help the passage of legislation that would finance the nuclear plants. In July, the US attorney for the southern district of Ohio announced that FirstEnergy would be fined US$230 million for their part in the scandal.

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