Utilities move forward on independent transmission company within PJM

VALLEY FORGE, Pa., June 26, 2002 — PJM Interconnection recently announced that American Electric Power; Commonwealth Edison; Illinois Power; and National Grid signed a memorandum of understanding with PJM to develop an independent transmission company (ITC) that would operate within PJM West.

The joint MOU was filed Monday with the Federal Energy Regulatory Commission (FERC).

The MOU sets the framework for the development of an ITC, managed by National Grid and operating within the PJM regional transmission organization. The participating utilities propose to place their transmission systems under the control of the ITC with the objective for the ITC participants to become operational within PJM during the last quarter 2002. American Electric Power, ComEd, and Illinois Power committed to joining PJM as individual transmission owners if an ITC agreement cannot be achieved.

“The ITC would expand the development of fully operational electricity markets beyond PJM West’s current footprint,” said Phillip G. Harris, president and chief executive officer, PJM. “We look forward to working with these companies to achieve this goal.”

The ITC will be an independent, for-profit entity that manages the transmission assets of the participating utilities as well as transmission assets it may construct or acquire.

PJM, the country’s first fully functioning regional transmission organization, operates the world’s largest competitive wholesale electricity market and North America’s largest power grid. The company currently coordinates a pooled generating capacity of more than 71,600 megawatts and operates a wholesale electricity market with more than 200 market buyers, sellers and traders of electricity. PJM has administered more than $9 billion in energy and energy service trades since the regional markets opened in 1997.

More than 70 nations have sent delegates to PJM to learn about its market model and the operation of the grid in a region including more than 25 million people in all or parts of PA, NJ, MD, DE, OH, VA, WV and the District of Columbia. With the April 1, 2002, addition of PJM West, for the first time nationally two separate control areas now operate under a single energy market and a single governance structure across multiple North American Electric Reliability Councils. Visit PJM at www.pjm.com.

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