AES Begins Construction of 670 MW Power Plant in Bulgaria; $1.4 Billion Investment Marks Largest Foreign Investment In Bulgaria.

ARLINGTON, Va. -- The AES Corporation (NYSE:AES) today announced plans to begin construction of the company's first power plant in Bulgaria, a $1.4 billion 670 MW lignite-fired plant. The project is the single largest foreign investment to date in Bulgaria and one of the largest greenfield investments in Southeast Europe. AES said it expects construction to begin May 9, 2006 when the project's lenders make their first disbursement of funds to the project.

The new Maritza East I plant, located near the town of Galabovo, Southeast Bulgaria, will be the first large scale power plant to be built in that country in more than 20 years. Upon completion, the base load facility will serve as a source of electricity for Bulgaria and Southeastern Europe. It is supported by a 15 year power purchase agreement with the national electricity utility in Bulgaria, Natsionalna Elektricheska Kompania (NEK), and a 15 year lignite supply agreement with the state owned mining company, Maritza East Mines (MMI). The plant will be constructed under the terms of a turnkey contract with ALSTOM and is expected to begin operations in 2009. ALSTOM will use its clean combustion technologies and provide the two pulverized coal boilers of 335 MW each, the two steam turbines, the two generators and the balance of the plant.

"Bulgaria is experiencing good economic growth, political stability and good opportunities in the power sector as it prepares its accession to the European Union. Bulgaria is the kind of market we want to do business in," said Paul Hanrahan AES President and Chief Executive Officer. "Our new plant will help supply Bulgaria's growing electricity needs and maintain the country's position as an energy hub for the region."

Financing for the project is through a consortium comprising the European Bank for Reconstruction and Development, Calyon, BNP Paribas and ING Bank. German and French export credit agencies and the Multilateral Investment Guarantee Agency of the World Bank are providing debt insurance cover to the lenders for a portion of the debt.

"Maritza East 1 will be the newest, most efficient and cleanest fossil fuel power plant in Bulgaria, meeting World Bank environmental standards and employing world class technology and equipment. We are very pleased with the support we've received from the Bulgarian government on this project and look forward to a long-term partnership with them," said Matthew Bartley, Executive Director, AES Maritza East 1.

The Maritza plant expands AES's strong presence in Eastern Europe. AES has been in this region for nearly ten years, since it acquired three power plants in Hungary in 1996. Today, AES has two distribution companies in Ukraine which serve 1.2 million customers and generation plants in the Czech Republic and Hungary. AES is also the leading company in biomass conversion in Hungary, generating more than one third of the nation's total renewable generation in 2004, which is the most recently available data.

Safe Harbor Disclosure: This news release contains forward-looking statements within the meaning of the Securities Act of 1933 and of the Securities Exchange Act of 1934. Such forward-looking statements include, but are not limited to, those related to future earnings, growth and financial and operating performance. Forward-looking statements are not intended to be a guarantee of future results, but instead constitute AES's current expectations based on reasonable assumptions. Forecasted financial information is based on certain material assumptions. These assumptions include, but are not limited to, continued normal levels of operating performance and electricity demand at our distribution companies and operational performance at our contract generation businesses consistent with historical levels, as well as achievements of planned productivity improvements and incremental growth investments at normalized investment levels and rates of return consistent with prior experience. Actual results could differ materially from those projected in our forward-looking statements due to risks, uncertainties and other factors. Important factors that could affect actual results are discussed in AES's filings with the Securities and Exchange Commission, including, but not limited to, the risks discussed under Item 1A "Risk Factors" in AES's 2005 Annual Report on Form 10-K. Readers are encouraged to read AES's filings to learn more about the risk factors associated with AES's business. AES undertakes no obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.

About AES

AES is one of the world's largest global power companies, with 2005 revenues of $11.1 billion. With operations in 26 countries on five continents, AES's generation and distribution facilities have the capacity to serve 100 million people worldwide. Our 14 regulated utilities amass annual sales of over 82,000 GWh and our 127 generation facilities have the capacity to generate over 44,000 megawatts. Our global workforce of 30,000 people is committed to operational excellence and meeting the world's growing power needs. To learn more about AES, please visit www.aes.com or contact AES media relations at [e-mail].