PSEG Power Announces Plans For 400MW of New Peaking Capacity
October 24 2007 - 8:30AM
PR Newswire (US)
NEWARK, N.J., Oct. 24 /PRNewswire/ -- PSEG Power, a wholly owned
subsidiary of Public Service Enterprise Group, announced today that
it has initiated with PJM the planning required for construction of
up to 400 megawatts (MW) of new gas-fired peaking capacity.
Depending on the timing and outcome of the process, PSEG Power
intends to bid this capacity into PJM's Reliability Pricing Model
(RPM) Base Residual Auctions in 2008 for supply beginning as early
as 2010. William Levis, president of PSEG Power, said, "The RPM
auction process is working well. The pricing provided by the
auctions held in 2007 provides sufficient return to support an
expansion of PSEG Power's investment in new peaking capacity. The
auction pricing also has increased our focus on the operating
performance of our reliability based units, resulting in lower
forced outage rates at PSEG Power's existing fleet." PJM received
FERC approval for the RPM process in December 2006 and initiated
the new auction process in early 2007. RPM has been successful in
providing the market with greater clarity around the value of
investments in new and existing capacity to meet reliability
requirements. PSEG Power has requested that PJM perform a
feasibility study to determine its ability to add up to a total of
1000 MW of new gas-fired capacity at some of its existing
generating stations located in the Eastern MAAC reliability region.
The study is the first step in the process to determine the
feasibility of adding the new generation capacity. Levis said the
cost to build the new capacity that would be available to bid into
the 2008 RPM auctions (300-400 MW) could be in the range of
$250-$350 million. He added that "the final decision to proceed
with construction would take into account capital and
interconnection-costs, available siting and the impact of any
potential environmental permitting restrictions." "The new
capacity," Levis said, "will complement PSEG Power's existing fleet
of 13,600 MW, improve the overall efficiency of the fleet, and
enhance reliability, in particular for New Jersey customers, where
PJM indicates additional energy supply is needed." PSEG Power, one
of the nation's largest independent power producers, is a
subsidiary of Public Service Enterprise Group Incorporated
(PSEG/NYSE:PEG), a diversified energy holding company. PSEG's other
primary subsidiaries are Public Service Electric and Gas Company
(PSE&G), New Jersey's oldest and largest energy distribution
utility company, and PSEG Energy Holdings, a holding company for
other non-regulated businesses. FORWARD-LOOKING STATEMENT Readers
are cautioned that statements contained in this press release about
our and our subsidiaries' future performance, including future
revenues, earnings, strategies, prospects and all other statements
that are not purely historical, are forward-looking statements for
purposes of the safe harbor provisions under The Private Securities
Litigation Reform Act of 1995. Although we believe that our
expectations are based on reasonable assumptions, we can give no
assurance they will be achieved. The results or events predicted in
these statements may differ materially from actual results or
events. Factors which could cause results or events to differ from
current expectations include, among other things: the effects of
weather; the performance of generating units and transmission
systems; the availability and prices for oil, gas, coal, nuclear
fuel, capacity and electricity; changes in the markets for
electricity and other energy-related commodities; changes in the
number of participants and the risk profile of such participants in
the energy marketing and trading business; the effectiveness of our
risk management and internal controls systems; the effects of
regulatory decisions and changes in law; changes in competition in
the markets we serve; the ability to recover regulatory assets and
other potential stranded costs; the outcomes of litigation and
regulatory proceedings or inquiries; the timing and success of
efforts to develop domestic and international power projects;
conditions of the capital markets and equity markets; advances in
technology; changes in accounting standards; changes in interest
rates and in financial and foreign currency markets generally; the
economic and political climate and growth in the areas in which we
conduct our activities; and changes in corporate strategies. For
further information, please refer to our Annual Report on Form 10-K
and subsequent reports on Form 10-Q and Form 8-K filed with the
Securities and Exchange Commission. These documents address in
further detail our business, industry issues and other factors that
could cause actual results to differ materially from those
indicated in this release. In addition, any forward-looking
statements included herein represent our estimates only as of today
and should not be relied upon as representing our estimates as of
any subsequent date. While we may elect to update forward- looking
statements from time to time, we specifically disclaim any
obligation to do so, even if our estimates change, unless otherwise
required by applicable securities laws. DATASOURCE: PSEG Power
CONTACT: Skip Sindoni of PSEG Power, +1-856-339-1111 Web site:
http://www.pseg.com/
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