Power Markets Development Co., a subsidiary of PP&L Resources Inc., will become part-owner of an electricity generating company in Bolivia, the company said Friday (7/7).

Power Markets Development will invest as part of a consortium that includes Constellation Energy, a subsidiary of Baltimore Gas and Electric; Ogden Power Systems, a New Jersey-based independent power company; and two Bolivian companies.

The Bolivian electricity generating company, Empressa Valle Hermoso S.A.M., was created when the Bolivian government split up its national power company, Ende. This breakup was the first step in a move toward a fully competitive electricity market in Bolivia.

The company includes four operating gas-fired combustion turbines (totalling 87 megawatts) near Cochabamba, and two gas-fired combustion turbines (totalling 124 megawatts) now being built in the province of Carrasco. The company sells power to distributing companies, which in turn deliver it to customers. The bid price was $34 million. The consortium will own a 51 percent share in the company. Constellation and Ogden will form a partnership to operate the company.

Financial closure of the transaction is expected within six months. Power Markets Development's initial investment will be about $10 million.

"This transaction is a very good first investment for Power Markets Development," said Bob Fagan, Power Markets Development president. "We targeted Latin America as one of our initial growth market areas, and we are pleased to be participating in a consortium which brings added expertise and helps spread the investment risk," he said. "Bolivia is a very stable country with a growing economy and our investment will provide early income to Power Markets Development at an attractive rate of return."

Power Markets Development was created in 1994 to invest in power projects domestically and overseas. PP&L Resources is the parent company of Pennsylvania Power & Light Co.