Southern Co.’s (SO) Southern Power has agreed to sell the Nacogdoches Generating Facility to municipal utility Austin Energy for $460 million.

When the wood-fired plant in Sacul, Texas, opened in 2012, Southern said it was the largest biomass plant in the U.S.

Austin Energy, which has a 20-year power purchase agreement for the 115-megawatt plant’s output, said the purchase “relieves our obligation to make escalating capacity payments to a third party and, over time, reduces the associated cost impacts to our customers.”

Proceeds will be used to strengthen Southern Co.’s balance sheet, help meet projected equity needs and further de-risk financing plans, Southern Power said.

Southern Power bought the project from American Renewables LLC in 2009.