Nashville selects Constellation Energy Source for new district energy system

BALTIMORE, Feb. 4, 2002 — Constellation Energy Source (CESource) President Greg Jarosinski said today that CESource has been awarded a contract to design, build and operate a $43.6 million district energy plant to serve downtown Nashville, Tennessee with chilled water and steam by the Metropolitan Government of Nashville and Davidson County (Metro).

The plant will be designed to heat and cool 39 major buildings, including the Tennessee State Capital, Metro’s Courthouse, Adelphia Stadium, home of the Tennessee Titans of the National Football League (NFL) and the Gaylord entertainment Center, home of the Nashville Predators of the National Hockey League (NHL).

CESource will operate the district energy system through a 15-year management agreement that includes options for three additional five-year extensions. If all options are executed, management services will result in an additional $105 million revenue to CESource. Services will include all operations, maintenance and repair responsibilities, as well as marketing and sales to potential new customers of the Nashville district energy system.

“This new district energy plant will replace the aging waste-to-energy facility which originally went into operation in 1973. When done years ago, our community leaders had vision. Now we are creating a new vision for district energy downtown that will be able to work alongside exciting redevelopment plans underway for downtown,” said Nashville Mayor Bill Purcell. “As for Constellation Energy Source, they have come out on top of a rigorous selection process. Nashville is pleased to have them as a business partner.”

The process by which CESource was selected took almost a year and included many of the energy services companies in the country. “Throughout the selection process Constellation Energy Source consistently demonstrated that they were the best company for this project,” added David Manning, Nashville Director of Finance. “Constellation Energy Source has the corporate backing, the experience and the people that I am confident will make this project a success. The new plant will save Nashville about $66.9 million by 2014, lower heating and cooling costs for downtown customers, and cost taxpayers nothing since it will be financed by revenue bonds and supported only by revenues from the sale of chilled water and steam.”

“Our selection reflects in large part the satisfaction that current customers have with our performance,” said Jarosinski. The project, CESource’s largest to date, is consistent with the CESource strategy to provide customized energy solutions nationwide to commercial and industrial customers with a focus on energy project development. This contract award comes on the heels of energy projects at Aberdeen (MD) Proving Ground, Fashion Show Mall in Las Vegas for The Rouse Company, and in Pittsburgh for the Pittsburgh Steelers of the NFL.

Constellation Energy Source is a member of Constellation Energy Group, a holding company headquartered in Baltimore, MD. Constellation Energy Group owns energy-related businesses, including a North American wholesale power marketing and merchant generation business and the Baltimore Gas & Electric Company (BGE), a regulated energy delivery company in Central Maryland. BGE provides service to more than 1.1 million electric customers and approximately 600,000 natural gas customers in Central Maryland. Constellation Energy Group had $3.9 billion in revenues in 2001 and assets of $13.7 billion on December 31, 2001.

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