New Cayuga Energy-PEI power generating plant now in service

BINGHAMTON, N.Y., May 29, 2001 — Cayuga Energy and PEI Power Corporation, a subsidiary of Southern Union Company, announced today that their newly constructed peaking-power plant in Archbald, Penn., is now in service and selling electricity to the mid-Atlantic market that includes Pennsylvania, New Jersey, Maryland, Delaware and the District of Columbia.

“With the summer months ahead, and as demand for electricity continues to outpace generating capacity, there is no better time to have brought this project to a successful conclusion,” said Michael German, who oversees Energy East’s non-utility ventures. “It was truly a team effort. By bringing the plant online ahead of schedule, we have again proven that Cayuga Energy and PEI Power Corporation are excellent partners.”

Last July, Cayuga Energy and PEI Power Corporation announced the formation of a joint venture company, PEI Power II, L.L.C., to build and operate the natural gas-fired plant which uses a state-of-the-art General Electric LM-6000 turbine.

Cayuga Energy, which also operates natural gas-fired power plants in New York, owns 50.1% of the new plant. Cayuga was the project manager for engineering and construction services for the new plant and now manages fuel procurement and electricity sales. PEI Power Corporation owns 49.9% of the plant. PEI Power Corporation managed the permitting process and onsite construction activities, and is now responsible for the plant’s daily operation.

The new plant shares a site with PEI Power Corporation’s 25-megawatt electricity and steam cogeneration plant which burns natural and landfill gases. It has been in operation since 1998. The addition of the 45-megawatt plant nearly triples the site’s generating capacity.

About Southern Union Company: Headquartered in Austin, Texas, Southern Union is an international energy distribution company serving more than 1.6 million customers in Texas, Missouri, Pennsylvania, Rhode Island, Massachusetts, Florida and Mexico. Its natural gas operating divisions include Southern Union Gas, Missouri Gas Energy, PG Energy, New England and Atlantic Utilities. In Texas, Southern Union Gas serves approximately 535,000 customers, including the cities of Austin, El Paso, Brownsville, Galveston and Port Arthur. Missouri Gas Energy serves approximately 498,000 customers in western Missouri, including the cities of Kansas City, St. Joseph and Joplin. In Pennsylvania, PG Energy serves approximately 156,000 customers, including the cities of Scranton, Wilkes-Barre and Williamsport. New England serves approximately 291,000 customers throughout Rhode Island and in parts of southeastern Massachusetts. Atlantic Utilities operates in Florida. For more information on Southern Union Company, visit http://www.southernunionco.com. For more information on PEI Power Corporation, visit http://www.peipowercorp.com.

About Energy East Corporation: Energy East is a super-regional energy services and delivery company in the Northeast. A leader in promoting competition, Energy East serves 2 million customers (1.4 million electricity and 600,000 natural gas) in upstate New York and New England over a 32,000 square-mile service area. The strength of the company is underscored by its commitment to financial discipline, state-of-the-art technology and the operational talent to be among the best at what it does. On February 20, 2001, Energy East announced a strategic combination with RGS Energy Group. The combined company will be one of the largest, most diversified energy providers in the Northeast, serving half of upstate New York and nearly 3 million customers, including approximately 1.8 million electric customers, almost 1 million natural gas customers and approximately 200,000 other retail energy customers. For more information, visit http://www.energyeast.com.

SOURCE: Energy East Corporation