Politics & Government

No Word on AES Thames Sale

Company went on the auction block on Friday

AES Thames, which pays more in taxes than any other Montville entity, went on the auction block on Friday.

The bids were to be accepted on Monday, but at the close of business on Monday, there was no word about the outcome of the auction.

The coal-fired power plant filed for bankruptcy protection Feb. 1. In addition to generating electricity, it also generates some of the steam used by RockTenn, the former Smurfit Stone. According to Jason Cornell, a bankruptcy attorney with the law firm Fox Rothschild LLP, the bankruptcy filing disclosed that AES Thames said that it was selling steam at a loss to Smurfit-Stone, and that that was one of the reasons it was filing.

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Cornell writes that Smurfit-Stone filed a suit in Connecticut requiring AES Thames to keep providing steam, even if AES lost money on it.

AES Thames is part of AES Corp., which has power-generating facilities around the world. It pays $1.2 million a year in taxes to the town, Mayor Ron McDaniel said on Tuesday. Finance Director Terry Hart said that the bulk of that comes from personal property taxes.

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In the coming fiscal year, Montville already is facing some big issues. A $1.3 million payment is scheduled to be paid to Rand-Whitney Containerboard, as part of a settlement over water issues, and the state is planning to pull more than $500,000 of funding from the school system.

 

Editor's note: If you're interested in reading more about AES Thames, Smurfit-Stone and the relationships among the companies near the river, check out the pdf in the photo box It was written in 1997, so it's old, but it delineates the relationships in an interesting and informative way.

 


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