Environmental Improvements from New Emission Limits.

LONDON--(BUSINESS WIRE)--March 26, 1996-- National Power has reached agreement with the pollution inspectorate, HMIP, on new emission limits for its coal and oil-fired power stations. The company's achievement of the limits will bring major environmental benefits.

National Power's investment of over 1.5 billion since privatisation in cleaner generating plant, which is already resulting in substantial environmental improvements, will make a major contribution towards meeting the new limits.

The new HMIP authorisations introduce significantly lower limits on emissions of sulphur dioxide, oxides of nitrogen and dust both for the company as a whole and coal and oil-fired power stations individually.

Against the background of increasing competition, the impact of the new limits on each station will be reduced by their ability to operate flexibly, to use low sulphur coals and by "switching" emissions between stations within the company's total limit. National Power will therefore be able to continue to operate its portfolio of plant flexibly and commercially. This will enable the company to achieve the necessary environmental improvements in the most cost effective way for electricity customers.

In 1995, National Power's sulphur dioxide emissions were 48% lower than in 1980, the base date for international protocols. Oxides of nitrogen emissions were 46% lower, and carbon dioxide about 38% lower.

Reductions in the company's new sulphur dioxide emission limits compared with emissions at the base date of 1980 and from the formation of National Power in 1991 are: -0-

               from 1980 levels    from 1991 levels

     1997           49%                 38%
     1999           61%                 52%
     2001           83%                 79%
     2005           87%                 84%

    Oxides of nitrogen emission limits will be reduced by a further
10% in 1999, and 33% in 2001, compared with 1991 limits.
    Limits on emissions of dust particles will also be tightened.  By
2001, the new limits will ensure that over 99% of dust will be
removed from the plants' flue gases.
    The new authorisations will have a similar effect on the three
coal fired power stations National Power is currently selling as they
will on the remainder of the company's plant.  Prospective purchasers
of the three stations - West Burton in Nottinghamshire, Ironbridge in
Shropshire and Rugeley in Staffordshire - are fully aware of the
implications of the new limits.
    National Power's 1.5 billion investment in cleaner plant
includes: building four new gas-fired plants totalling 3,000
megawatts; installing sulphur removal equipment (FGD) at the 4,000
megawatt Drax power station, which provides around a third of the
company's output; investments in cogeneration plant; fitting special
burners to its large coal-fired plant to reduce oxides of nitrogen;
and improving the efficiency of dust removal plant.  In addition, the
company has invested to secure a coal import capability of some 11
million tonnes per annum.
    Last year, National Power's emissions of sulphur dioxide and
oxides of nitrogen were around 30% below the statutory limits.  The
reductions have made a very significant contribution towards reducing
the UK's emissions in line with international agreements.
    Keith Henry, National Power's Chief Executive, said:
"The new emission limits set very high environmental standards.
They are significantly tighter than current international agreements
especially on the reduction of sulphur dioxide.
    "In anticipation of the new limits, we have invested heavily in
our existing coal-fired plant and in new gas-fired plants to bring
"cleaner"  electricity on stream.  These investments, further planned
fuel and plant improvements, and other investments open to us ensure
that the company is very well placed to meet its future obligations
under the new authorisations.  The limits are not expected unduly to
inhibit our ability to operate our plant in a flexible and commercial
way.
    "Our commitment to a continuing programme of environmental
improvement is underpinned by the high standards of environmental
management we have set ourselves.  These include the registration of
Drax power station under the European Union's Eco-Management and
Auditing Scheme, a UK first, and achieving British Standard 7750
certification of environmental management systems at our major
sites."

CONTACT: National Power, New York

Lynda Jenkins Investor Relations

44-171 615 3912