On the morning of Feb. 2, sleeping residents of the Rhode Island towns of Cranston and Johnston were rudely awakened by a booming roar.
Bleary-eyed and confused, several of them called the police shortly after hearing the loud sound, which began at around 5:40am and lasted about three minutes before a few seconds of lull, then another three minutes of noise.
“It sounded like helicopters landing across the street, almost like planes, like I was near the airport,” Carol Bellows, a local resident, told NBC 10 News.
RISEC and shine
Police from the two towns were eventually able to track down the source of the disturbance—the 583 MW Rhode Island State Energy Center (RISEC) gas-fired project on Shun Pike in Johnston, which is owned by The Carlyle Group.
The noise turned out to be the result of an electrical issue that arose during plant maintenance that morning, which also caused the release of steam, which was seen by residents.
Apart from its ability to wake up residents at the crack of dawn, the RISEC project is known in project finance circles for another unusual feature.
In July, Carlyle closed a term loan A refinancing for the power plant, for which Investec was sole bookrunner.
The $363 million seven-year debt package was priced at 275 basis points over Libor with a 99.25% original issue discount, the deal was more than twice oversubscribed (PFR, 7/23).
Interestingly, the deal included a “hedge toggle” feature, which automatically adjusts the margin on the loan depending on whether the project is supported by a power hedge in the future.
Under the terms of the feature, the pricing on the loan will step up by 100 basis points unless RISEC secures a power hedge for years four through seven of the deal.