Dynegy

From Wikipedia, the free encyclopedia

This article does not cite any references or sources. (May 2007) Please help improve this article by adding citations to reliable sources. Unverifiable material may be challenged and removed.

Dynegy Inc.
Type	Public (NYSE:DYN)
Founded	1984 as Natural Gas Clearinghouse
Headquarters	Houston, Texas, USA
Area served	USA (14 states)[1]
Key people	Bruce A. Williamson, Chairman and CEO Stephen A. Furbacher, President and CFO[2]
Industry	Energy (Electrical power industry)
Products	Natural Gas (formerly, discontinued after 2005)[3] Electricity generation

Dynegy Inc. (NYSE: DYN), based in Houston, Texas, is a large owner and operator of power plants and a player in the natural gas liquids and coal business.

Once known as "The Natural Gas Clearinghouse," Dynegy adopted the "New Economy" branding in 1998, after which the company structured itself in a manner similar to Enron, launching several business ventures, including an online trading platform and broadband communications services, which could be misconstrued of those of its larger rival.

While over 60 communities around the country have defeated coal plant proposals, Dynegy has more clean coal plant proposals than any other company in the country. Concerned about the environmental effects of coal, the company has been congratulated by a number of environmental groups including the Sierra Club. CEO Bruce Williamson was recently a runner-up in the Energy Action Coalition's Fossil Patriot award "... for its unceasing promotion of clean coal power. Dynegy is proposing to build more clean coal-fired power plants than any other power company in the United States. Known in some regions of the U.S. as "LS Power,” Dynegy is currently proposing to build six new coal plants in the United States."

Contents 1 History 2 References 3 External links 4 See also

[edit] History

The Natural Gas Clearinghouse became better known by its later shortened name, NGC Corporation in the early 1990s, when it became a publicly traded company listed on the New York Stock Exchange. NGC was an integrated natural gas services company, paying a cash dividend to shareholders each year since 1994. By 1996 it had grown to US$550 million in assets, and carried US$525 million in long-term debt.^[4]

In June 1998, Dynegy Inc. was created from the merger of its predecessor, NGC Corp., with Chevron Corporation's natural gas and natural gas liquids businesses.^[5]

In a merger completed February 1, 2000, Illinova Corporation became a wholly-owned subsidiary of Dynegy Inc., a deal in which Chevron Corporation also took a 28% stake. Illinova, the utility holding company of Illinois Power Company, had grown to over US$415 million in assets and US$1.8 billion long-term debt.^[4] As of the late 1980s, the IP utility company had operated almost entirely from coal plants, with less than 1% fueled from oil and gas.^[6]

Dynegy, along with Enron, El Paso, Reliant and several other energy companies, was accused of price manipulation and other fraudulent practices during the California electricity crisis in 2000. In 2001, the company made an unsuccessful takeover bid for Enron, pulling out at the last minute following an unexpected restatement of earnings by Enron. Shortly after the pull-out, Enron filed for Chapter 11 bankruptcy and sued Dynegy. One aspect of the takeover deal that did survive, however, was Dynegy's acquisition of the Northern Natural Gas Company pipeline, Enron's most lucrative pipeline asset.

Unfortunately for Dynegy's shareholders and employees, these events did nothing to prevent Dynegy itself from lapsing into a crisis similar to that of Enron in late 2002. Amid accusations of accounting fraud and other misdoings, founder Charles Watson resigned, and the company was forced to sell the Northern Natural Gas pipeline to a consortium of investors led by noted billionaire Warren Buffett.

Following these incidents, the company hired Bruce Williamson, a former Duke Energy executive, who began a program of cost cutting, elimination of unprofitable businesses and financial restructuring which was successful in averting a bankruptcy filing. The company disposed of all of its businesses with the exception of its core merchant power and natural gas liquids businesses. Refocused on these core businesses, and managed with a strong emphasis on efficiency and cost control, Dynegy was able to stabilize its financial position. In the most recent quarter, Dynegy only lost $152 million (18 cents per share). While Williamson has helped the companies bottom line, his embrace of clean coal has brought the company some positive publicity.

In 2004, Dynegy sold the Illinois Power Company to Ameren Corporation (NYSE: AEE), the successor company of the IP Company's original partners from the 1952 Midwest Power Pool system.^[7]

In late 2005, Dynegy continued its restructuring by selling its natural gas liquids business^[8] to Targa Resources, a company owned by private equity firm Warburg Pincus.

The company is a member of ABEC, Americans for Balanced Energy Choices^{[citation needed]} an organization funded in part by the coal industry that touts the benefits of "clean coal".

In the spring of 2008, the company received over 5,000 phone calls from across the country asking them to not switch their considerable resources away from coal to cleaner, greener, renewable energy that may or may not be better for public health, the environment, and the economy.^{[citation needed]}

[edit] References

[edit] External links

• Dynegy corporate website
• [1] A website for the campaign to clean up Dynegy
• [2] A clearinghouse of information on the coal industry
• [3] A website parody of ABEC's claims of "Clean Coal"
• [4] Website in which CEO Bruce Williamson won 3rd place for Fossil Fool of the year in 2008

[edit] See also

• Coal power in the United States