Will Help Meet Growing Colorado Energy Needs While Balancing Environmental Concerns

PARVADA, Colo. - The Denver area gained a new 111-megawatt natural gas-fired peaking power plant today when Plains End, LLC began commercial service in Arvada, Colo. The plant, which has the capability to deliver enough electricity for more than 110,000 homes, is owned by PG&E National Energy Group, a unit of PG&E Corporation (NYSE: PCG).

The technology used at the Plains End plant allows it to operate more efficiently in higher altitudes than most other available sources. The peaking facility is designed to be started and quickly brought on-line, allowing for a swift response during periods of increased power demand, particularly those prompted by extreme weather conditions.

"Plains End represents among the best of today's technology to meet peak power demand in Colorado," said Chris Iribe, president and chief operating officer of PG&E National Energy Group's east region. "Our new power plant balances the energy needs of the area while being sensitive to local environmental concerns."

In addition to using natural gas, the Plains End plant has modern carbon monoxide (CO) catalysts for CO reduction and uses selective catalytic reduction to help reduce nitrogen oxides. Traditional power generation steam cooling is not needed, so demands on water resources at Plains End are equivalent to that used at seven to nine residential homes.

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Located on 15 acres, the plant uses 20 reciprocating engines to produce electricity under a 10-year power purchase agreement with Xcel Energy.

"We are very pleased about the new Plains End facility," said David Eves, managing director of Energy Trading and Purchased Power for Xcel Energy. "It is the most flexible and responsive electricity resource to operate."

"We were excited about this project when it first came before us and we are pleased to see that it will soon be serving the needs of the citizens of Colorado," said Arvada Mayor Ken Fellman. "This project is a great example of what can be accomplished when the community and private industry work together."

The Plains End facility came together in relatively short time with construction beginning less than a year ago. Wärtsilä North America, Inc., built the plant and provided the engines.

"We are proud to have been a part of the Plains End project, and to assist our customer in providing power to the community of Arvada, Col.," said Tom Carbone, president of Wärtsilä North America, Inc. "The efficiency and flexibility of Wärtsilä engines at high altitude and temperatures, as well as the low emissions and water usage, will provide that energy at the lowest possible cost to the community and its environment."

Plains End, LLC is a wholly-owned, indirect subsidiary of PG&E National Energy Group. 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.

This news release discusses certain matters that may be considered "forward-looking" statements within the meaning of Section 27A of the Securities Act of 1933, as amended, including statements regarding the intent, belief or current expectations of PG&E National Energy Group and its management. Actual future results could differ materially from those expressed or implied in any forward-looking statements. Some of the key factors that could cause actual results to differ materially include, but are not limited to, (i) changes in government regulations, including federal and state regulation of the electric energy industry; (ii) the delay, interruption or prevention of operations because of various construction and operation risks, such as a failure to obtain or maintain necessary permits or equipment, necessary permits or equipment, the failure of third-party contractors to perform their contractual obligations, the failure of equipment to perform as anticipated, or an inability to obtain equipment or labor on acceptable terms, (iii) the development and operation of competing power plants; (iv) fluctuations in natural gas and electricity prices and the ability to successfully manage such price fluctuations; (v) the risks associated with marketing and selling power from power plants in the newly competitive energy market; and (vi) the other risks identified in PG&E National Energy Group's reports filed with the Securities and Exchange Commission.