Since divestiture of utility-owned generation began in the mid-90s nearly 400 generating facilities have been sold in more than 75 transactions. While many sales involve individual power projects, most involve portfolios of projects. Controversy surrounds several aspects of the portfolio sales. Is a portfolio worth more than the sum of its stand-alone project values? If so, why and how much? Is a portfolio a device for creating and exercising market power? Of 396 projects sold through year-end 2000, 365 were sold as part of a transaction involving at least one other project. During 2001 there were only a few divestitures and the patterns are similar. While these data show that portfolio transactions are common, they may also paint a misleading picture of value. The 31 single-project sales include some large and high-value facilities such as Homer City. More important, many of the portfolios sold actually have little synergy and thus they yield little extra value to a new owner. Sellers, buyers, regulators, and tax and judicial parties need to recognize this fact. A detailed evaluation of the sales shows why.
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