PSEG Power New York gains state approval for 750-MW Bethlehem Energy Center

New York siting board grants Article X certificate

NEWARK, N.J., Feb. 28, 2002 — The New York State Board on Electric Generation and the Environment Thursday granted a Certificate of Environmental Compatibility and Need for PSEG Power New York’s (PSEGNY) Bethlehem Energy Center (BEC), a state-of-the-art, 750-megawatt (MW) natural gas fired combined cycle power plant.

The $400 million project will replace the existing 400-MW Albany Steam Station located about three miles south of Albany in Bethlehem, NY. Russell S. Arlotta, PSEGNY director-development, said BEC construction will begin this spring. The new plant is expected to begin commercial operation in 2004 at which time the existing station will be retired.

PSEGNY is a subsidiary of PSEG Power, one of the nation’s largest independent power producers and energy trading companies. PSEG Power has almost 17,000 MW of electric generating capacity in operation, construction, or advanced development.

PSEGNY filed an application supplement for state certification under Article X of the state Public Service statute in July 2001. The supplement completed an original Article X application submitted by Niagara Mohawk in 1998 and reflected PSEGNY’s update and improvement over the original plan. The New York State Department of Environmental Conservation (NYDEC) granted necessary air and water permits for BEC earlier this month.

The BEC project will redevelop the existing Albany Steam Station site and replace its 1950’s technology with a state-of-the-art, clean, efficient facility that will almost double the energy output of the site while dramatically reducing air and water environmental impact.

The facility will be among the cleanest power plants in New York, reducing emission rates of nitrogen oxide and sulfur dioxide by 97-98%. It will also reduce use of Hudson River water for cooling by 98-99% in comparison to the existing plant. In addition, the project will produce significant economic benefits in terms of construction spending, jobs, and increased business activity over the long term.

The project has generated widespread community support and has been endorsed by a number of environmental organizations including the American Lung Association of New York, the Natural Resources Defense Council, the Hudson River Keeper and Scenic Hudson Inc.

Arlotta thanked the Siting Board, the NYDEC, and the Department of Public Service for the expeditious review and approval of the BEC Article X application. “We believe the approval process reflects the fact that BEC represents the best type of energy development for New York,” he said. “It will result in the retirement and replacement of older generating capacity with the cleanest and most efficient new technology available. We appreciate the public support for the project among the local community and environmental organizations. And, we look forward to maintaining and enhancing these relationships as we construct and operate BEC. This facility will be a long-term source of pride for the Bethlehem community, the Capital Region, and the State of New York.”

PSEG Power is a subsidiary of Public Service Enterprise Group Incorporated (NYSE: PEG – news), a diversified energy holding company with headquarters in Newark, NJ.

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