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Living Energy · No. 11 | December 2014 5554 Living Energy · No. 11 | December 2014

Texan businessmen and modern-day cowboys Bob and Todd Carter of Panda Power Funds are blazing new trails – in the energy industry and on their ranch. With Siemens, they’re building some of the fastest, cleanest and most efficient power plants in the USA.

Text: Diana Smith Photos: Kael Alford

Visit the online version of Living Energy to view the short documentary “True Grid – Energizing Texas”

and an interview film with Panda Power Funds’ Bob

and Todd Carter.

The Carters share a great love for wildlife. At their ranch, they raise deer and help to bring back the quail population. “We’re actually a profitable organization on this ranch, too,” says Bob.

TRUE GRIT


A rmed with little more than sheer determination and grit, rugged Western cowboys were able to

overcome virtually any obstacle. That tradition continues at Panda Power Funds, the Dallas-based private equi-ty firm run by the father-son team of Bob and Todd Carter. In fact, a not-so-symbolic sign is prominently dis-played in the company’s boardroom. “No Excuses,” it reads. During a three-day tour, the Carters welcomed Living Energy to their high-rise headquar-ters in metropolitan Dallas, to the company’s state-of-the-art power plant in Temple and to the family’s impressive ranch in rural West Texas.Today, the company is reshaping the energy business in Texas and in the USA. Panda Power Funds is investing in and building six large-scale proj-ects to supply homes with critical power. Three of those are located in Texas, where the population is ex-ploding and demand is at an all-time high. In fact, according to September u

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2012 United States Census Bureau da-ta, eight of the fastest-growing cities in the USA are in the Lone Star State. “We’re keeping the lights on in Texas,” says CEO Bob Carter. Working with Siemens, Panda Power Funds is con-structing or operating 758-megawatt, natural gas-fired combined cycle power plants, one in Sherman and two in Temple. All told, the three plants will be able to supply the power needs of more than 2 million homes in Texas.

Better for the Environment, Better for CustomersThe Texas power plants use Siemens state-of-the-art Flex-Plant™ technolo-gy, which provides environmental and consumer benefits. Combined cycle power plants use the hot exhaust gas produced by a gas turbine to generate steam, which in turn drives a steam turbine. Both turbines transfer their energy to a generator that produces electricity. The combined cycle

“The Flex Plant™ design is a perfect dance partner

for plants that use renew-able resources like wind,”

says Todd Carter, who is holding the reins as Panda

Power Funds President.

Panda Power Funds CEO Bob Carter at the Panda headquarters. “Shale gas has been a game changer for Texas,” he says. “We’re now the Saudi Arabia of shale gas.”

Panda Power Funds new combined cycle power plant Temple I is already in opera-tion. Its twin sister, Temple II, is seen under construction in the background.


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Panda Power Funds – the Business Side

Panda Power Funds was formed in 2010 by the former senior management team and energy professionals of Panda Energy International, an inde-pendent power development and management company founded in 1982. While at Pan-da Energy, the executive team around Bob and Janice Carter financed, developed, built and operated 9,000 megawatts of generating capacity, at an ap-proximate cost of US$6 billion, including the two largest nat-ural gas-fueled power plants ever built in the United States.Panda Power Funds closed its initial private equity fund with US$420 million of com-mitments in 2011. In addition to evaluating third-party op-portunities and management teams, Panda Power Funds has the ability to internally source proprietary, large-scale power generation devel-opment and other investment opportunities.

The Panda Funds currently has a number of power projects near completion. These in-clude two generation projects, representing approximately US$1.5 billion in financing, that recently completed con-struction. Panda’s 758-mega-watt Sherman, Texas, and 758-megawatt Temple I proj-ects: The Funds’ 758-megawatt Temple II project is under con-struction and expected to go online in 2015.In late 2011, Panda Power Funds developed and constructed the largest solar facilities in the northeastern United States in Pilesgrove, New Jersey. The 20-megawatt Pilesgrove Solar Farm was a joint development project between Panda Power Funds and ConEdison Devel-opment, an affiliate of the utili-ty that serves New York City. Panda Power Funds is contin-ually exploring investment opportunities in both conven-tional and renewable energy.

At their ranch in Seymour, Texas, the Carters employ the same philosophy as in their business – everything is an investment, and a well-laid-out legacy for future generations.

Janice Carter has been in the energy business with her husband Bob for more than 30 years.

During a three-day visit with the Carters, the Living Energy team had the chance to sit down for an in-depth business interview with Bob and Todd Carter – “Living Energy Face-to-Face with Panda.” On the right side: journalist Diana Smith.

significantly increases the electrical energy yield from the fuel, which is good for the environment and also re-duces fuel costs.Additionally, the plants’ “quick start” technology provides an optimum so-lution to help support the integrity of the state’s electrical grid and supple-ment other renewable resources. Todd Carter, senior partner and presi-dent of Panda Power Funds, says: “The Flex-Plant™ design makes it a perfect dance partner for plants that use renewable resources like wind.”

Natural Gas – Salvation of the Energy Market The original Texas energy boom liter-ally erupted when the famous East Texas oilfield Spindletop hit more

than a century ago, its first well gush-ing black gold into the air more than 100 feet high. Most recently, the Tex-as-led shale revolution has made the Lone Star State the epicenter of a worldwide energy revolution. Thanks to George Mitchell, a Texas oil and gas producer who cracked the code for horizontal shale extraction, the state’s production has skyrocketed, and Texas has become the world’s largest producer of oil and gas.With four major shale formations in the state – the Barnett Shale in North Texas, the Haynesville in East Texas, the Eagle Ford in South Texas and the Permian in West Texas – Panda Power Funds’ plants are ideally situated. Their proximity to the state’s natural gas is expected to provide significant

siemens.com/living-energy/panda-interview-yt

The Living Energy app with additional features can be downloaded for free from the Google Play Store and the Apple App Store.

“ With conservation, we can’t just sit back and wait on the biologists,” Bob says. “It’s got to be a combined effort. We’re doing our part on this ranch.” Bob Carter, CEO of Panda Power Funds

Living Energy interview with Panda Power Funds


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operating cost advantages. That also holds true for the company’s Pennsyl-vania plants, Liberty and Patriot, now under construction and sited in the heart of the Marcellus Shale.

Innovative Investing“That’s very important,” explains Todd Carter. “As a private equity company, we have partners. We have partners who invest in us, and we invest their capital. Our investors are pension funds. They’re from police, teachers and firemen – hard-working men and women of this country. We take that seriously.” He relates, that during negotiations, “Siemens asked us why we were push-ing so hard. We’re tough because of who our investors are.”

The Panda ConnectionThe Carter family has long been vet-erans of the energy industry and champions of highly efficient, envi-ronmentally friendly power genera-tion facilities. In 1982, Bob Carter and his wife Janice started Panda Energy International. The company built the two largest gas-fueled electric gener-ation facilities in the USA totaling 4,400 megawatts of generating capac-ity, was responsible for the first US-sponsored, internationally financed run-of-the-river project in Nepal and obtained the first US capital markets financing for construction of a power plant in the People’s Republic of China. Long before environmental steward-ship was popular, they named the company Panda, after the endangered giant panda bear and a symbol of environmental responsibility. Recog-nized by Newsweek as one of the top ten eco-friendly energy companies

Panda Temple Power Facts

Bob and Todd Carter on a tour of Temple I with Power Plant Manager Sean Hausman. “From a technological and an environmental standpoint, there’s nothing like this plant,” says Hausman.

in America, Panda Energy is Panda Power Funds’ predecessor company headed by Janice Carter.

Field of DreamsFive years ago, Todd Carter was stand-ing in a rural Texas field with waist-high grass and overgrown sunflowers. He said: “Boys, we’re going to build a power plant here.” That field was in Temple, Texas, a rural enclave with about 71,000 residents located on the important I-35 corridor halfway be-tween Dallas and Austin/San Antonio. “Originally, when we look to build a power plant, we need access to trans-mission power lines, natural gas,

“ This is by far the best plant I have ever worked at. The automation is incredible. There was thought behind it.” Sean Hausman, Panda Temple Power Plant Manager

water, but the most important thing that we look for is a community that supports us,” says Todd Carter. “When we first came to this city, there was an incredible amount of support that we received.”Business and civic leaders and resi-dents welcomed Panda, due in large part to the expanding tax base it rep-resented but also because a power plant requires little from the city in terms of infrastructure and services, such as fire, police, emergency services or additional schools. According to Temple Mayor Danny Dunn, Panda’s Temple projects have been critical in the city’s economic

In Texas the large amount of wind generation requires natural gas-fueled backup generation.

The Temple plants support the development of additional renewable generation by closing the generating gap caused

when renewable energy suddenly drops offline. The clean and efficient Flex PlantsTM provide higher

power output during high temperature conditions, making the plant ideal for Texas’ hot summers.

Panda Power Funds, www.pandafunds.com, retrieved Sept. 11th 2014

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development. “Panda Power is the sin-gle largest private investment in the city of Temple. It is a game changer.”

State-of-the-Art TechnologyAt the bustling, 250-acre power plant in Temple, Plant Manager Sean Haus-man says the Siemens’ Flex-Plant™ design is very efficient, making Tem-ple I one of the most efficient com-bined cycle power plants in the

country. “The fast-start capability is really what sets this plant apart,” he says. “The Siemens’ combustion tur-bines can synchronize in 10 minutes and reach full load within 30 minutes. The entire plant can achieve full pow-er production within 60 minutes.” That is particularly important, allow-ing rapid response to changing market conditions, in a state where summers are relentless and demand is through the roof.Temple I’s sister plant, Temple II, is expected to be online by the end of summer 2015. “When Temple II is constructed, it is not unrealistic that we will be able to supply the power grid with well over 800 megawatts within 30 minutes,” adds Hausman. “That’s very impressive. A normal combined cycle power plant wouldn’t be able to produce that type of power for a good hour or more.” Both plants will incorporate the latest emissions-control technology, use treated effluent water, and are per-mitted as zero-liquid-discharge sites. No wastewater is discharged from the site, a feature that incurs more cost, but was important to the Carters as leaders in producing environmentally friendly power generation facilities.

Ranch RevitalizationVisiting the Carter’s Circle J & B Ranch on a sweltering August day, Living Energy found a veritable oasis carved out on the arid West Texas plains near Seymour. The ranch, which includes hundreds of acres of natural habitat, along with colorful, drought-resis-tant landscaping and a waterfall carved from natural rock, is a 28-min-ute trip by air or three hours by auto-mobile from Dallas. The home at the ranch is fully equipped, identical to their Dallas office, so they can run Panda Power Funds seamlessly away from the office.

At the conference room in the Temple plant, there are paintings of Republican as well as Democratic Presidents of the USA. “Our investors are firemen, police, teachers... the working men and women of this country,” explains Todd Carter.

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“ Our investors are pension funds. They’re from police, teachers and firemen – hard-working men and women of this country. We take that seriously.”Todd Carter, President of Panda Power Funds

“On the ranch, we are not just looking for a hobby. We have everything here to run Panda away from the office in Dallas,” says Bob Carter.

Ranching has always been a perilous business, but the Carters approach it the same way as they do their energy company. “We try to take the business practices we have with our company, Panda, and incorporate those into this ranch,” explains Bob. “So we’re not just looking for someplace for a hobby. We’re actually a profitable or-ganization on this ranch as well as in our businesses.”He continues, “We see conservation as an investment. The return that we get here is improving genetics and the habitat, the ability of our ranch.” The sprawling ranch includes a prof-itable deer raising operation, a lake stocked with black bass, blue gill, and u

An optimistic outlook on the energy future of Texas and the USA: Todd Carter and Panda Power Funds are putting together the cleanest power fleet in the state.


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hybrid stripers, Missouri walking horses, a shooting range and a quail conservation program. “You won’t find cattle here,” Bob reports. “Cattle have overgrazed the land out here for many years, but we believe that con-servation is much better than leaving a scorched earth.”The main business of the Circle J & B Ranch is raising trophy white-tailed deer. “Hunting is a US$2 billion in-dustry in Texas, so we have a very unique place in that we do only man-agement hunting,” Bob adds. The deer on the ranch are carefully monitored by ranch manager Chris Timmons, a graduate of Texas Tech University. “They’re on a strict nutritional pro-gram; they receive nutrients and get medication,” says Timmons.

“She’s stood shoulder to shoulder with me for 32 years in business and 52 years in life,” Bob Carter says about Janice. Together, they built Panda to be a force to be reck-oned with in the energy industry.

Bringing Back the Bobwhite Raising trophy deer is the money-making operation of the ranch, but reviving the bobwhite quail popu-lation is Bob’s passion. In the last decade, the quail population in the USA has experienced a tremendous decline. Though scientists studying the issue cite increasing crowding of habitats, parasites and other prob-lems, there has not been a definitive answer for the decrease. It is a prob-lem Carter aims to solve. “We can’t just sit back and wait on the biologists,” Bob says. “It’s got to be a combined effort on the parts of universities, institutions and private organizations. We’re doing our part on this ranch.” In 2010, Bob Carter was the recipient of the T. Boone Pickens Lifetime Sportsman Award presented by Park Cities Quail for his efforts to

help bring back the endangered bob-white quail population.

The Cowboy WayIn Texas, there’s an expression, “cow-boy up,” which means do the right thing and put the work in even when the going is tough. The Carters live it daily. “We invest in only the best technology, only the cleanest technol-ogy, and we use the same principles in our business that we use on this ranch,” says Bob Carter. “We know that by being good corporate citizens and by protecting the environment we are doing the things that are best for this country and this planet.” p

A native of Texas, Diana Smith is a business, science and technology writer based in Austin.

830 jobs were created during peak construction time

of the Temple plants, and 35 skilled workers and 35 skilled workers manage

the plants.

50% power production can be achieved in 30 minutes employing quick-start turbines. Full base-load capacity is reached in

60 minutes.

10.5 % in 2015 and 8.5 % in 2016 – ERCOT, the Electric

Reliability Council of Texas, has forecast reserve margins declining below the

13.75% reserve requirement necessary for grid reliability.

45 % of Texas’ 21 million citizens

live within 50 miles of the I-35. The

facility has been strategically sited

along the Texas half of the I-35 corridor, one of the ten

most concentrated, and rapidly grow-

ing, population centers in the USA.

Panda Temple I and II Power Plants in Numbers

Join Jonny Carroll and his film crew to visit Panda Power Funds in Texas. See their new Flex Plant in Temple and find out about the Carters’ life and business philosophy in the Living Energy short documentary “True Grid – Energizing Texas.”

The Living Energy app with additional features can be downloaded for free from the Google Play Store and the Apple App Store.

siemens.com/living-energy/panda

Texas

The control room at Temple. Once Temple II comes online, both plants will be run from this single center.

The Temple power plants provide a template for future energy genera-tion in the state.

1,500 megawatts will be provided to the Texas grid by Temple I and II, two clean natural gas-fueled, combined cycle facilities.

1.5 million homes will be

supplied with power from Temple I and II.

US$1.6 billion

will approximately be infused into the

Central Texas economy.

250 acres of land are covered by the plants, located

in Synergy Industrial Park in Temple, Texas.

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