Capstone Turbine Corp., the world's leading clean technology manufacturer of microturbine energy systems, announced that E-Finity Distributed Generation, Capstone's exclusive distributor for the Mid-Atlantic, Southeastern United States, and the Caribbean, signed a long-term Factory Protection Plan (FPP) service contract covering Capstone's single largest combined heat and power (CHP) installation with 5 megawatts (MW) of Capstone Microturbines.
"I am extremely pleased with our Capstone aftermarket business, including long-term FPP service contracts, Distributor Support Systems (DSS) program, as well as our new long-term microturbine rental fleet as all three of these initiatives continue to deliver steady revenue growth and solid contribution margins," stated Darren Jamison, Capstone's president and chief executive officer.
"While all of the offerings from our aftermarket business are important to Capstone, it is the FPP with its stable, predictable, long-term revenue and positive cash flow that really underpins both our near-term positive Adjusted EBITDA plans and our long-term sustainability and profitability outlook. The 5 MW CHP installation, now with its new 9-year FPP, is expected to benefit both Capstone and the end-use customer jointly over the life of the project, making it truly a long-term win-win energy partnership," concluded Mr. Jamison.
The five new Signature Series C1000's are commonly ducted together to inject the turbines' exhaust thermal energy directly into a drying process for a large ceramic tile manufacturer in the United States. This 9-year FPP will provide comprehensive service coverage, including engine overhauls, as well as all scheduled and unscheduled maintenance at a fixed cost for the entire 9-year term. The Capstone microturbines, commissioned in late October 2019, are used for 24x7 electrical and thermal generation and are configured with Capstone Dual-Mode technology that will "island" the power plant and provide back-up electrical and thermal power to plant operations in the event of a local grid power outage.
"E-Finity sets the standard for aftermarket support for their large fleet of Capstone Microturbines, and with this win, they now have 54 MW under the Capstone innovative FPP program," said Jeff Foster, Capstone's Senior Vice President of Customer Service and Product Development. "With this latest Energy Efficiency FPP contract coming on the heels of a number of large Oil & Gas FPP contracts, our flexible FPP offering has become the backbone for continuing the top-line growth of our high margin aftermarket business," added Mr. Foster.
"The continued high adoption rate of our FPP, now with 54% of eligible customers covered, is driving our profitable aftermarket business to new highs," stated Jen Derstine, Capstone's vice president of marketing and distribution. "By securing this newest contract, we have set another record of having 263 MWs covered under long-term service contracts, which provides the backbone for recurring, predictable, profitable revenue streams for many years and is a great asset to all our stakeholders including our distribution partners who perform the work under the FPP contract on behalf of Capstone," concluded Derstine.