Allegheny Energy, American Electric Power To Build 765-kV Transmission Lines

Two major electric utility companies will be working together to build new major electric transmission lines. Allegheny Energy, Inc. has signed a memorandum of understanding with American Electric Power to form a joint venture company to build and own new electric transmission assets, including new 765-kV transmission lines and related facilities. The joint venture will build and own approximately 250 miles of 765-kV transmission lines from AEP’s Amos power station (Poca, W.Va.) to the Maryland border. An additional estimated 40 miles of 765-kV transmission line from the Maryland border to the Kemptown substation will be developed and owned by Allegheny.

Based on current plans, the proposed project is estimated to cost approximately $1.8 billion, some of which would be owned by the joint venture, with other portions owned by the respective companies. Allegheny and AEP expect to execute definitive agreements for the joint venture by mid-2007 and anticipate the joint venture will begin operations in the second half of 2007. Completion of the Amos-Kemptown is expected in 2012.

Allegheny’s Trans-Allegheny Interstate Line (TrAIL), a separate, 210-mile project scheduled for completion in 2011, would not be part of the joint venture. The agreement also does not preclude either company from pursuing other transmission opportunities in PJM.