La Paloma Generating Company, LLC

Acquisition of a Combined Cycle Gas Plant - Deal of the Year 2006

IEP through its predecessor company Complete Energy, LLC. acquired the La Paloma is a 1,022 MW gas-fired, four-unit combined-cycle facility, situated in Kern County, California, approximately 110 miles northwest of Los Angeles. The La Paloma facility utilizes four state-of-the-art gas-fired combustion turbines, making it one of the most efficient and cleanest fossil-fueled generation stations in operation in Southern California. La Paloma is also geographically positioned to serve both Northern and Southern California. Three of the four La Paloma units were contracted through a tolling agreement with Morgan Stanley (“MS”). The plant’s comparatively low heat rate provided a sustainable competitive advantage in the California market. Additionally, La Paloma’s rapid cycling and turn down capabilities allowed La Paloma to quickly respond to market conditions and opportunistically increase load to capture incremental margin from the volatile spot market in California, thereby optimizing peak-period operations. The facility’s 446-acres of property and 300 MW of available transmission capacity, allowed for the potential addition of a combined or simple-cycle generation facility, or a solar farm.