Puget Sound Energy to acquire interest in EPCOR’s Frederickson power facility


EDMONTON, Oct. 23, 2003 — Puget Sound Energy said it intends to acquire a 49.85 percent interest in EPCOR’s 249-MW Frederickson Power facility.

Frederickson Power LP is held by EPCOR Power Development Corporation (EPDC), a subsidiary of EPCOR Utilities Inc. This transaction, with proceeds to EPCOR of approximately U.S. $76.4 million, is expected to close by the second quarter of 2004, pending regulatory approvals.

“With its strong customer base in Washington State, PSE is an excellent partner for Frederickson Power,” said Brian Vaasjo EPCOR Executive Vice President and President of EPCOR’s Energy Division. “The transaction would be consistent with EPCOR’s business and risk management strategy. As we look ahead, our business relationship with PSE may provide further opportunities in the Pacific Northwest.”

“Through this transaction with EPCOR, we are adding a cost-efficient, clean natural gas plant to PSE’s growing portfolio of diverse power resources,” said Eric Markell, PSE’s Senior Vice President of Energy Resources. “Our interest in EPCOR’s Frederickson plant will bolster PSE’s capability to meet customers’ energy needs with stable prices and reliable supply.”

EPCOR will continue to operate Frederickson Power, a combined cycle natural gas facility. EPCOR will also continue to supply the Benton, Franklin and Grays Harbor Public Utility Districts with 125 megawatts under the 20-year agreement reached in April 2001. PSE’s share-approximately 124 megawatts-of power output from the Frederickson facility would become part of the utility’s overall mix of energy resources for serving its customers’ electricity needs.

EPCOR is planning a spring upgrade to the Frederickson Power facility, boosting its maximum power output to 275 megawatts. Following this upgrade, EPCOR would have 137 megawatts and PSE’s share would increase to 137 megawatts. This work is planned for completion in the second quarter of 2004.

EPCOR Utilities Inc. is one of Canada’s top providers of energy and energy-related services and products. Drawing on over 100 years of experience, EPCOR owns and operates power plants, electrical transmission and distribution networks, builds and operates water and wastewater treatment facilities and infrastructure and provides power and water solutions to customers in Alberta, British Columbia, Ontario and the U.S. Pacific Northwest. With $4.5 billion in assets, EPCOR is headquartered in Edmonton, Alberta. EPCOR’s web-site is www.epcor.ca.

Puget Sound Energy is Washington state’s largest energy utility, providing electric service in 11 counties to more than 972,000 customers and natural gas service to about 636,00 customers (300,000 of those customers receive both forms of energy), at a growth rate above the national average. Puget Sound Energy, a regulated utility, is the largest subsidiary of Puget Energy, a holding company traded on the New York Stock Exchange (NYSE:PSD – News). www.pse.com

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