The loss comes in spite of increased production volume. Dynegy produced approximately 10.2 million megawatt-hours (MWh) in 1Q08 and 11.1 million MWh in 1Q09, an increase of 8.8%.
Dynegy operates in three regions: the Midwest, which has a production capacity of approximately 8,400 megawatts (MW); the West, with approximately 5,500 MW of capacity; and the Northeast, with a capacity of about 3,800 MW. In a conference call regarding the company's earnings, Chairman, President and CEO Bruce Williamson spoke of the company's production across each region.
"In the Midwest, our overall production volumes increased by about 10% due to warmer winter temperatures. This was primarily driven by increased production from our natural gas units," he said. "In the Northeast, cooler-than-normal weather and lower fuel prices drove a 60% increase in our production volumes.... In the West, warmer temperatures led to a 40% decline in our production volumes period over period."
However, in spite of this overall increase in production, lower power prices significantly reduced earnings. Adjusted earnings before interest, taxes, depreciation and amortization (EBITDA) were $198 million, compared to $237 million in 1Q08. This earnings decrease combined with the goodwill impairment charge led to a sizeable loss for Dynegy.
Industrial Info is currently tracking slightly less than $3.2 billion of Dynegy's current and future projects in the U.S. Approximately $2 billion of these projects are occurring at the company's Plum Point Power Plant in Osceola, Arkansas.
Initial construction of the 600-MW grassroot, coal-fired power plant began in March of 2006. Completion of the project is expected in August of 2010. A 665-MW Unit 2 addition to the plant has also been proposed and is still in the permitting stages. Construction of this second unit would probably not begin until mid-2011.