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May 8, 2014
Seattle Steam Co. announced this week that it has been acquired by Brookfield Asset Management, a Toronto-based global asset manager with over $180 billion in assets under management.
Terms of the deal were not disclosed.
Seattle Steam's systems will be part of Brookfield's infrastructure group.
Brookfield operates district energy systems in Chicago, Toronto, Houston and New Orleans. The systems draw energy near the point of generation and can be used to power, heat and cool a single building or an entire neighborhood.
The acquisition gives Seattle Steam access to other district energy experts, said Stan Gent, Seattle Steam CEO, in a statement.
“Not only will we be able to better service our existing customers, but we will also have the resources and capital to offer our clean, renewable thermal energy to customers who currently are beyond our current reach.”
Seattle Steam is a privately owned utility founded in 1893 that provides steam heat to nearly 200 buildings in downtown Seattle and on First Hill. The system has 18 miles of steam pipe under Seattle streets.
Seattle Steam said the change in ownership will not interrupt its operations or affect customer service agreements. Current employees, including Gent, will remain with the company.
Brookfield operates 216 hydroelectric, wind and thermal energy facilities in the United States, Canada and Brazil. In the U.S., it has $116 billion in assets under management and 5,500 employees.
According to Seattle Steam, Brookfield was interested in the acquisition because of Seattle Steam's biomass boiler, which was installed in 2010.
The biomass plant is one of only two district energy systems in North America that use such technology, according to Seattle Steam. It burns wood from urban waste such as land clearing, tree trimming, broken pallets, unusable shipping frames and deconstruction.
The boiler allows Seattle Steam to reduce fossil carbon emissions for its customers by up to 60 percent, the company said.
The acquisition announcement said Brookfield has expertise in energy and water conservation, recycling, wildlife preservation, timber harvesting and erosion control.
The acquisition will require a resolution from the Seattle City Council. Pipes under city streets are authorized by a 50-year franchise agreement adopted by the Council in 2003. Seattle Steam can't transfer the privileges of the franchise without the Council's consent.
Gent told the DJC that the sale is expected to close by fall.
Seattle Steam plans to open a new water well today at its plant on Western Avenue, Gent said. The well will provide the plant with its own water supply and cut long-term costs.
The well, which is believed to be first new deep-water well in downtown Seattle in decades, draws water from a location downstream from Lake Washington.
“We are quite literally borrowing water heading toward Puget Sound, using it to produce steam, then returning it to finish its journey to the sound,” Gent said.