DENTON, Texas, June 13, 2001 PG&E Corporation's National Energy Group today announced an agreement with the City of Denton, Texas, to purchase and operate the municipality's electric generating facilities and provide a five-year "full service requirements" wholesale power-supply contract.
Under the agreement, approved last evening by the Denton City Council and Public Utility Board, a subsidiary of the National Energy Group will acquire the 176-megawatt, natural gas-fired Spencer Generating Station, as well as the Lewisville and Ray Roberts Hydro facilities. Plus, over the next five years the National Energy Group, through its power trading subsidiary, will supply wholesale power to meet the city's electricity needs. The City of Denton will continue to distribute power to its customers.
"We're pleased to be able to help the City of Denton meet its power needs during this period of transition to a deregulated market place," said Thomas B. King, president of the National Energy Group's west region.
City of Denton employees at Spencer Station will be offered employment with the National Energy Group in accordance with the terms of the acquisition.
"I think that selling these generation elements and replacing them with a power-purchase contract guarantees ratepayers with stability in the power market over a significant period in the future," said Denton City Council Member Mark Burroughs.
"This agreement marks a new era in our effort to provide Denton residents and businesses with efficient, reliable energy," said Denton utility director Sharon Mays. "The National Energy Group will help us progress smoothly into the deregulated energy environment."
Denton's power facilities will be owned by Spencer Station Generating Company, L.P., and power and energy services will be provided by PG&E Energy Trading - Power, L.P. Both entities are indirect, wholly owned subsidiaries of PG&E National Energy Group, which develops, owns and operates electric generating and gas pipeline facilities and provides energy trading, marketing and risk-management services. The National Energy Group is headquartered in Bethesda, Md., and maintains offices in Houston.
This news release contains forward-looking statements regarding the future performance of PG&E National Energy Group and its businesses. These statements are subject to certain risks and uncertainties that could cause actual results to differ materially.
Some of the factors that could cause actual results to differ materially include: (i) changes in government regulations, including federal and state regulation of the electric energy industry; (ii) commercial operations of plants that may be interrupted or prevented because of various operation risks, such as a failure to obtain or maintain necessary permits or equipment, the failure of third-party contractors to perform their contractual obligations, or an inability to obtain equipment, services or labor on acceptable terms; (iii) development of lower cost generation or supply alternatives; (iv) fluctuations in natural gas and electricity prices and the ability to successfully manage such price fluctuations and other limitations in risk management methods, (v) the risks associated with marketing and selling power in the newly competitive energy market, and (vi) the other risks identified from time to time in PG&E Corporation's reports filed with the Securities and Exchange Commission.
EDITORS: Please do not use "Pacific Gas and Electric" or "PG&E" when referring to PG&E Corporation or its National Energy Group. The PG&E National Energy Group is not the same company as Pacific Gas and Electric Company, the utility, and is not regulated by the California Public Utilities Commission. Customers of Pacific Gas and Electric Company do not have to buy products or services from the National Energy Group in order to continue to receive quality regulated services from Pacific Gas and Electric Company.