CV Central Vermont Public Service Corp.

Central Vermont Public Service (NYSE: CV) will purchase the southern Vermont franchise territory of Vermont Electric Cooperative under an agreement designed to rationalize service territories and lower local electric rates. Under the agreement, which must be approved by the Vermont Public Service Board, CVPS will acquire VEC's southern Vermont assets and the rights to serve 2,770 customers, who will on average save about 8.1 percent under CVPS ownership, even after a pending 6.15 percent rate case is complete. "This agreement consolidates service territories and provides CVPS with important growth," President Bob Young said. "It will reduce local rates, and strengthens CVPS by providing new revenue and a wider base to allocate fixed costs." VEC Chief Executive Officer David Hallquist said the sale made sense for the co-op, as it would provide significant cash, while divesting a service area far removed from most of VEC's territory, which is primarily in northern Vermont. CVPS will pay approximately $4 million for VEC's southern Vermont assets and territory. "This area is virtually centered between CVPS's Springfield, Brattleboro and Sunderland offices," Hallquist said. "It makes more sense for CVPS than VEC to serve it." Customers affected by the sale are in Halifax and parts of Andover, Dover, Newfane, Townshend, Wardsboro, Jamaica, Marlboro, Guilford, Vernon, Wardsboro, Wilmington, Windham, Whitingham and Readsboro. Four of five VEC employees in the region are expected to be hired by CVPS. CVPS plans to maintain the current VEC service office in Wilmington. When the sale is completed, the former VEC customers will be covered by CVPS's 17 SERVE Standards, which measure everything from reliability to customer service, and are reported to state regulators. SERVE stands for Serving Everyone with Reliability, Value and Excellence. The new customers will also be eligible for all CVPS programs, including even monthly billing, Electripay and CVPS Cow Power(TM). The purchase is the second announced by CVPS in recent months. CVPS announced the purchase of Rochester Electric Light and Power, a privately held, 900-customer company, in April. That purchase is awaiting regulatory approval, which is expected this summer. CVPS, founded in 1929, is Vermont's largest electric utility, serving about 151,000 customers. More than 100 companies have merged into CVPS since its founding. Forward-Looking Statements Statements contained in this report that are not historical fact are forward-looking statements intended to qualify for the safe-harbors from the liability established by the Private Securities Litigation Reform Act of 1995. Statements made that are not historical facts are forward-looking and, accordingly, involve estimates, assumptions, risks and uncertainties that could cause actual results or outcomes to differ materially from those expressed in the forward-looking statements. Actual results will depend, among other things, upon the actions of regulators, performance of the Vermont Yankee nuclear power plant, effects of and changes in weather and economic conditions, volatility in wholesale electric markets and our ability to maintain our current credit ratings. These and other risk factors are detailed in CV's Securities and Exchange Commission filings. CV cannot predict the outcome of any of these matters; accordingly, there can be no assurance that such indicated results will be realized. Readers are cautioned not to place undue reliance on these forward-looking statements that speak only as of the date of this press release. CV does not undertake any obligation to publicly release any revision to these forward-looking statements to reflect events or circumstances after the date of this press release.