AES Reaches Agreement to Sell Two Australian Generation Businesses for Approximately A$295 Million, or $165 Million; Net Equity Price to AES is Approximately $58 million.

Business & Energy Editors

ARLINGTON, Va.--(BUSINESS WIRE)--Dec. 13, 2002

The AES Corporation (NYSE:AES) announced today that it has entered into agreements to sell its two Australian generation businesses in transactions valued at A$295 million.

Origin Energy Limited, an Australian company, has committed to buy AES Mt Stuart, AES's 288MW gas fired peaking generation business in Queensland, in a transaction valued at A$93 million, or approximately US$52 million.

A consortium of Babcock & Brown and Prime Infrastructure Group, has committed to buy AES Ecogen, which comprises AES's 510MW Newport and 450MW Jeeralang gas-fired generation plants in Victoria, in a transaction valued at A$202 million, or approximately US$113 million.

The combined value of both transactions equates to an equity purchase price of A$104.25 million, or approximately US$58 million, which currently represents a premium to AES's book investment of 140%. Completion of these transactions is subject to the receipt of certain project lender and customer approvals and AES expects the transactions to close by the end of the first quarter of 2003.

Paul Hanrahan, President and Chief Executive Officer, stated, "The sale of these two AES businesses in Australia is a terrific first step in our expanded asset sales program, and we are pleased with the value we have received for them. We think the premium reflects the high quality of these businesses. We are also making good progress on our plan to raise $1 billion from asset sales, in addition to the $800 million of sales from the completed sale of AES NewEnergy and pending sale of Cilcorp. We continue to focus on improving the financial performance of our company and returning value to our shareholders. The execution of this plan is the primary focus of our company."

"Safe Harbor" Statement under the Private Securities Litigation Reform Act of 1995: This news release may contain "forward-looking statements" regarding The AES Corporation's business. These statements are not historical facts, but statements that involve risks and uncertainties. Actual results could differ materially from those projected in these forward-looking statements. For a discussion of such risks and uncertainties, see "Risk Factors" in the Company's Annual Report or Form 10-K for the most recently ended fiscal year.

AES is a leading global power company comprised of contract generation, competitive supply, large utilities and growth distribution businesses.

The company's generating assets include interests in 176 facilities totaling over 60 gigawatts of capacity, in 33 countries. AES's electricity distribution network sells 108,000 gigawatt hours per year to over 16 million end-use customers.

For more general information visit our web site at www.aes.com or contact investor relations at [e-mail].