SOURCE: Renegy Holdings, Inc.

November 26, 2007 08:30 ET

Renegy Holdings Completes Acquisition of Susanville Biomass Plant

TEMPE, AZ--(Marketwire - November 26, 2007) - Renegy Holdings, Inc. (Renegy) (NASDAQ: RNGY) announced today that it has executed and closed a definitive Asset Purchase Agreement with a leading forest products and timber company for the acquisition of an idle biomass power plant for $1.3 million. The plant assets include a boiler capable of producing 160,000 pounds per hour of steam and a turbine that can generate approximately 13 megawatts (MW) of base-load electricity to power as many as 13,000 homes.

Renegy is continuing to explore the most suitable location for operating the plant, which may be at its current site in Susanville, California or at another location. The Asset Purchase Agreement provides that Renegy will have the right to lease or purchase the real property where the plant is currently located. If maintained in Susanville, Renegy estimates the plant could be fully operational in 2008, subject to the timing associated with completing refurbishment and securing any air and other environmental permits necessary to restart the plant. The final site determination will be based upon long-term fuel availability in the form of wood waste and the securing of a long-term power purchase agreement from a utility company for the entire power output of the plant. Depending upon location and site-specific costs, Renegy anticipates investing as much as $15 million to refurbish, and possibly relocate, the plant. Renegy estimates this investment will be substantially less if the plant is maintained at its current location. Renegy is currently in discussions with certain utility companies relating to long-term power purchase agreements for a plant of this size as well as future energy facilities, and has identified several prospective sites for future plants, including sites suitable for this plant if relocated. Renegy is also continuing discussions with several potential financial partners relating to debt financing for the project.

"The acquisition of this wood waste facility is a key first step toward our goal of building a growing portfolio of biomass to electricity power generation assets throughout North America," stated Bob Worsley, chairman and CEO of Renegy. "This plant will add approximately 13 MW of power output to the 24 MW that will be generated by our first biomass facility in Arizona, which is scheduled to be commissioned in the first half of 2008. Both these and future biomass facilities will help address the rapidly increasing demand for renewable energy driven by Renewable Portfolio Standards (RPS) and other legislation now in place in 28 states across the country. Such regulations are creating significant opportunities for renewable energy projects, particularly in California, which requires that utilities obtain 20 percent of their total power sold from renewable sources by the end of 2010."

About Renegy

Renegy, based in Tempe, Arizona, is a green energy company focused on acquiring, developing and operating a growing portfolio of biomass to electricity power generation facilities. Renegy seeks to rapidly grow its renewable energy assets with the goal of becoming the leading independent power producer (IPP) of biomass electricity in North America. Its first project is Snowflake White Mountain Power (SWMP), a 24 megawatt (MW) biomass facility under construction near Snowflake, Arizona. This facility is scheduled to begin supplying electrical power to Arizona's two leading utility companies in the first half of 2008, and serves as a solid foundation for the Company's growth. Find Renegy on the Worldwide Web at www.Renegy.com.

This news release contains forward-looking statements within the meaning of the Securities Act of 1933, as amended, and the Securities Exchange Act of 1934, as amended, and is subject to the safe harbors created therein. These statements include, but are not limited to, those regarding the ability of the Company to secure a suitable location for operating the plant, either at its current site in Susanville, California or at another site, long-term fuel availability in the form of wood waste, and debt financing for the project; the prospects and timing associated with commencing operation of the plant, including completing refurbishment, obtaining air and other environmental permits necessary to restart the plant and securing a long-term power purchase agreement from a utility company for the entire power output of the plant; the expected investment of as much as $15.0 million to refurbish, and possibly relocate, the plant; the timing associated with the commissioning of the Company's Arizona biomass power plant and its ability to begin producing electrical power in the first half of 2008; and the Company's growth strategy and future opportunities. These statements are subject to risks and uncertainties that could cause actual results and events to differ materially from those expressed in the forward-looking statements. These risks and uncertainties include, among others, the risk that we will not be able to secure a suitable location, long-term fuel supply, air permits, a power purchase agreement or financing for the 13 MW biomass plant; delays in the completion and commissioning of the Arizona biomass plant or future energy facilities; diversion of management's attention away from other business concerns; the risks associated with the development, generally, of the combined company's overall strategic objectives; the existence of unanticipated technical, commercial or other setbacks related to the Company's products and services, including construction delays and the ability of the Company to secure adequate fuel for its biomass plants; changes in the environmental requirements relating to certain emissions; and the other risks set forth in the Company's most recent Form 10-QSB filed with the Securities and Exchange Commission. The Company undertakes no obligation to update any forward-looking statements to reflect new information, events, or circumstances occurring after the date of this release.

Contact Information

  • CONTACT:
    Megan Meloni
    Investor Relations
    (650) 631-2847