American Water Names George Mackenzie Interim CEO.

VOORHEES, N.J. -- American Water, the largest and most geographically diversified provider of water services in North America, today announced the appointment of George MacKenzie as Interim President and Chief Executive Officer (CEO) of American Water, effective January 1, 2006. He will report directly to Harry Roels, Chief Executive Officer of RWE AG, American Water's corporate parent.

Mr. MacKenzie has been a member of the American Water Board of Directors since August 2003 and also has served as the Chair of the Audit Committee of the Board since February 2004.

Harry Roels has stated, "George's knowledge of American Water and his leadership qualities position him well to carry forward the strengths that have made the company the market leader it is today."

In addition to being a Director of American Water, George serves on the Board of Trustees of the Medical Center of Delaware and is a member of the Investment Committee at the University of Delaware. He is also a Director of Central Vermont Public Service Corporation, Safeguard Scientifics, Inc. and C&D Technologies, Inc., where he also served as Interim CEO early in 2005.

MacKenzie previously served as vice chairman of the Board and Chief Financial Officer of Hercules Incorporated, a global manufacturer of chemical specialties whose 5,000 employees generated sales of approximately $2 billion in fiscal 2004. During his 22-year career with Hercules he served in a variety of senior management roles including President of the Chemical Specialty Division.

Mr. Jeremy Pelczer, the current President and CEO of American Water, will continue to serve as a non-executive Chairman of American Water and head of RWE Thames Water.

American Water Appoints MacKenzie

American Water, headquartered in Voorhees, New Jersey, is the largest and most geographically diversified provider of water services in North America. The company has regulated and non-regulated utility businesses located across 29 states and three Canadian provinces. In fiscal 2004, 7,000 American Water employees generated over $2 billion in revenues. The company also serves over 18 million people with clean drinking water and wastewater services. More information can be found by visiting www.amwater.com.

RWE, based in Essen, Germany, is one of the leading international utility companies. The company provides customers with electricity, gas and water as well as services related to these products. The company's core markets are Germany, the UK and Continental Europe. Major companies and millions of households throughout Europe rely every day on the RWE Group's services and products. In fiscal year 2004, approximately 98,000 employees worldwide within the RWE Group generated sales of EUR 42 billion.