State Action is a Major Milestone

HERMISTON, Ore. - The Oregon Energy Facility Siting Council has awarded a site certificate for the Umatilla Generating Project, a proposed generating plant being developed by the PG&E Corporation's (NYSE: PCG) PG&E National Energy Group (PG&E NEG). The action, taken by the Siting Council late last week, is a major milestone in the process to prepare the plant in northeastern Oregon for construction.

The proposed plant will be designed with the capacity to generate up to 598 megawatts of electricity and will be located across the street from PG&E NEG's Hermiston Generating Plant near Hermiston, Ore. The plant is expected to be in service by 2004.

"We have worked closely with the Oregon Energy Siting Council, as well as the various interested parties, throughout the state process, and the project is a better one because of these efforts," said Thomas B. King, president and chief operating officer, PG&E NEG West Region. "We will continue to work with the Siting Council and the Oregon Office of Energy in our effort to develop an energy resource that will help meet the long-term power needs of the people of Oregon and the rest of the Northwest."

The Umatilla Project will be fueled by natural gas transported by PG&E NEG's natural gas pipeline system, Gas Transmission Northwest (GTN).

The plant will be equipped with advanced-technology pollution control equipment. It will meet every federal, state and local regulation for air emissions, including Oregon's groundbreaking rules for carbon dioxide offsets.

Construction of the Umatilla Generating Plant could begin in early spring of 2002. Between 300 and 350 local construction jobs are expected to be created at the peak of construction. The project will hire 10 to 15 full-time employees when it begins operation, which will be in addition to the 27 full-time jobs at the Hermiston Generating Plant.

"We greatly appreciate the efforts of the Hermiston-area community throughout the siting of the Umatilla Generating Project and will continue working with local officials throughout the rest of this process," said Hermiston Generating Plant Manager Greg Cook. "As with all of our generating plants, we are committed to significant corporate citizenship in the communities we serve. The Umatilla Generating Project will continue that tradition."

GTN, a subsidiary of PG&E NEG, would transport the natural gas for the Umatilla Generating Project. GTN operates a dual pipeline system, which begins at the Idaho/British Columbia boarder, crosses northern Idaho, southeastern Washington and central Oregon, terminating at the Oregon/California border. The pipeline can ship approximately 2,700 million decatherms a day (Mdth/d) and interconnects with other natural gas pipelines, as well as local distribution companies serving retail customers in the Northwest. GTN is in the process of constructing an expansion to its mainline system, which will add approximately 200 Mdth/d of capacity. The company also is pursuing additional potential expansions beyond 2002.

Headquartered in Bethesda, Md., PG&E National Energy Group develops, builds, owns and operates electric generating and natural gas pipeline facilities and provides energy trading, marketing and risk-management services.