AES Completes Financing of $230 MM Power Plant Under Construction in Mexico.

ARLINGTON, Va.--(BUSINESS WIRE)--June 22, 1998--The AES Corporation (NYSE: AES) announced today that it has raised $173 million of non-recourse project financing for the AES Merida III 484 MW gas-fired combined cycle power plant currently under construction in the City of Merida, Yucatan, Mexico.

The new facility will provide power to the state utility in Mexico, Comision Federal de Electricidad, under a 25 year power purchase agreement.

The International Finance Corporation ("IFC") provided a $104 million loan, of which $74 million was provided by a commercial bank syndicate through a "B" loan and the remainder was provided by IFC as a direct "A" loan.

The IFC, along with The Sanwa Bank Limited as Co-Manager, arranged the "B" loan syndication. The financing also included a $69 million loan provided by The Export-Import Bank of Japan ("JEXIM") through its Overseas Investment Credit ("OIC") program.

The combined cycle power plant will be operated by a subsidiary of AES. The project company, AES Merida III, S. de R.L. de C.V, is 55 percent owned by AES. The other partners include Nichimen Corporation of Japan (25%) and Grupo Hermes S.A. de C.V. of Mexico (20%).

Construction of the plant is scheduled to be completed early in the year 2000. Subsidiaries of Westinghouse Power Generation, a division of CBS Corporation, are providing equipment and construction services.

Ms. Sarah Slusser, President of AES Aurora, Inc., said, "We were delighted to win the Merida III project early in 1997 in a highly competitive international bid and are extremely pleased to be the first independent power project in Mexico. AES is looking forward to continuing our participation in Mexico's growing power market."

Mr. Dennis W. Bakke, President and CEO of AES, stated, "This financing underscores the emphasis we place on the use of non-recourse project financing in newly opened competitive markets. We continue to rapidly grow and diversify our global business with this entry into the power market in Mexico."

AES' business development successes in 1998 include the following:

-- In January, AES acquired the CLESA distribution company in El Salvador for $96.5 million.

-- In January, AES won a bid to sell electricity from a 360 MW gas-fired plant in Haripur, Bangladesh.

-- In April, AES Caracoles signed a 40 year concession agreement for its 230 MW Caracoles project and has taken over the operation of Quebrada de Ullum, an existing 45 MW hydroelectric plant in Argentina.

-- In April, AES' affiliate, Light-Servi os de Electricidade, acquired Electropaulo Metropolitana, the distribution company serving the city of Sao Paulo, Brazil.

-- In May, AES completed its purchase of three electric generating stations from Southern California Edison.

-- In May, AES acquired 90% of Edelap, an electric distribution company in the province of Buenos Aires, Argentina.

AES is a leading global power company that currently owns or has an interest in ninety-one power facilities totaling over 27,000 megawatts in the United States, Canada, Australia, Argentina, Brazil, Dominican Republic, Pakistan, the Netherlands, Hungary, Kazakhstan, China and the United Kingdom.

In addition to having assets in excess of $8 billion, the Company has more than $5 billion of projects in construction or late stages of development. AES is dedicated to providing electricity worldwide in a socially responsible way.

For more general information visit our web site at www.aesc.com or contact investor relations at [e-mail]. The list aes-pr- announce is an automated mailing list and can be found on the investing page of our web site. Those who subscribe to this list will receive updates when AES issues a press release.

   CONTACT:  The AES Corporation
              Kenneth R. Woodcock, 703/522-1315