The Montana Power Company has agreed in principle to a PPL EnergyPlus electricity supply offer that would, based on current market prices, save Montana electricity customers more than $350 million over five years.
"We have made an offer to sell up to 500 megawatts from PPL Montana’s power plants, at 4 cents per kilowatt-hour, a level that is at least 25 percent below the market price for electricity in this region," said Larry De Simone, president of PPL EnergyPlus.
PPL EnergyPlus, a subsidiary of PPL Corporation (NYSE: PPL), markets the electricity produced by all of PPL’s power plants in the United States, including those owned by PPL Montana.
De Simone also said that PPL EnergyPlus would begin offering long-term energy supply contracts to the state’s industrial and large commercial customers after the contract with MPC is finalized.
"As we have said throughout this debate, we are committed to being part of the solution to the energy issues facing the people of Montana. While sales at this price will result in a significant sacrifice of potential revenues for our company, we are pleased to offer a way to help Montana mitigate the price increases that citizens of the state are facing," De Simone said.
The offer anticipates legislative and regulatory support for the approach, he said.
"We are ready to sign this contract as soon as we can work out final details with MPC," said De Simone.
"This is an excellent offer that will result in substantial savings for the people of Montana and also help ensure a reliable supply of electricity for the next several years," said De Simone. "We are hopeful that state officials will join PPL and The Montana Power Company in endorsing this agreement as an important step toward a balanced solution to the state’s electricity supply problems."
PPL has agreed in principle to a five-year contract, beginning on July 1, 2002, to sell 500 megawatts of capacity to The Montana Power Company so that MPC can meet its obligation to default supply customers who are unwilling or unable to purchase power on their own. PPL EnergyPlus would sell this energy at 4 cents a kilowatt-hour.
PPL EnergyPlus also reaffirmed its intentions to sell additional amounts of electricity directly to end-use customers in Montana.
"Once this agreement is approved, we will offer long-term, unit-contingent energy-supply deals to industrial and large commercial customers in Montana," said De Simone. "We are committed to being a business-to-business supplier for these companies, which are vital to the long-term economic vitality of Montana."
De Simone also noted that PPL already has offered a unique proposal to make available 20 megawatts of power – at below-market rates – through June 30, 2002, to assist industrial customers in the short-term. This offer, De Simone said, could result in $50 million in savings for these customers.
Certain statements contained in this news release are "forward-looking statements" within the meaning of the federal securities laws. Although PPL Corp. believes that the expectations and assumptions reflected in these forward-looking statements are reasonable, these statements involve a number of risks and uncertainties and actual results may differ materially from the results discussed in these statements. Any such forward-looking statements should be considered in conjunction with PPL Corp.'s Form 10-K and other reports on file with the Securities and Exchange Commission.
PPL EnergyPlus is an unregulated subsidiary of PPL Corp. PPL EnergyPlus is not the same company as either PPL Electric Utilities, the electric utility, or PPL Gas Utilities, the gas utility. The prices of PPL EnergyPlus are not regulated by the Pennsylvania Public Utility Commission, and you do not have to buy PPL EnergyPlus electricity, natural gas or other products in order to receive the same quality regulated services from PPL Electric Utilities or PPL Gas Utilities.