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MISO, PJM planning joint and common wholesale energy market

VALLEY FORGE, Pa. and CARMEL, Ind., Jan. 21, 2002 — PJM Interconnection and the Midwest Independent Transmission System Operator, Inc. (MISO) today announced that they have executed a “Letter of Intent” to develop a single wholesale market for electricity producers and consumers in all or parts of 27 Midwest and mid-Atlantic states, the District of Columbia and the Canadian province of Manitoba.

The vision for achieving a single energy market is outlined in the Letter of Intent, which officials at PJM and MISO discussed with their respective members and boards last week.

“This Letter of Intent reflects PJM and MISO’s commitment to develop a single, robust energy market that meets the needs of all customers and stakeholders in the combined region,” said Phillip G. Harris, PJM president and chief executive officer. “PJM and MISO’s intent is to offer an innovative approach to serve the needs of the public and the individual states and governmental entities, while benefiting the economies in the regions encompassed by the market.”

“Working with PJM on a joint and common market design will allow both regions the opportunity to rapidly realize the benefits of a seamless power market,” said James P. Torgerson, president and chief executive officer of the MISO, the nation’s first FERC-approved regional transmission organization.

The Letter of Intent outlines several guiding principles for the creation of a common energy market, including:
* The development of the market will be fully consistent with the safe and reliable operation of the electric power grid,
* The single energy market will be administered by two separate organizations with certain functions undertaken jointly and others undertaken through common processes,
* The needs of the states, district and province, individually and collectively, will be integral to a successful solution,
* Appropriate information technology network architectural design will be established that will provide for growth, redundancy, security and flexibility for the future, and
* A commitment to an open process to advise on the development of the market design by immediately establishing a joint stakeholder market committee.
* A single market through PJM and MISO’s regions would span more than 1 million square miles in all or portions of:
* From the Midwest ISO, including TRANSLink and the Southwest Power Pool (SPP): Montana, North Dakota, South Dakota, Nebraska, Kansas, Minnesota, Missouri, Iowa, Wisconsin, Illinois, Indiana, Michigan, Kentucky, Ohio, Virginia, Wyoming, New Mexico, Oklahoma, Arkansas, Louisiana, Texas, Mississippi, and the Canadian province of Manitoba.
* From PJM and PJM West: Pennsylvania, Maryland, Delaware, New Jersey, West Virginia, Virginia, Ohio and the District of Columbia.

MISO’s scale of operations including TRANSLink and SPP:
* 17.5 million customers served
* 114,000 megawatts of peak load
* 125,000 megawatts of generating capacity
* 118,000 miles of transmission lines
* $12.8 billion in installed assets

PJM and PJM West’s scale of operation include:
* 25.1 million people served
* 62,445 megawatts of peak load
* 66,072 megawatts of generation capacity
* 13,100 miles of transmission lines
* $6.5 billion in installed assets
* 200 members
* 298,011 gigawatt hours of annual energy
* 614 generation sources with diverse fuel types
* Over $3.4 billion in annual billing

A copy of the Letter of Intent accompanies this release. For more information visit www.pjm.com or www.midwestiso.org .