Fitch Rates Georgia Transmission's Commercial Paper 'F1+'.

Business Editors

NEW YORK--(BUSINESS WIRE)--Oct. 7, 2002

Fitch Ratings has assigned an 'F1+' rating to Georgia Transmission Corp.'s (GTC) new $150 million commercial paper program. Merrill Lynch and Sun Trust will act as dealers for the commercial paper notes and liquidity support will be provided by Sun Trust Bank through a $150 million 364 day liquidity facility. The notes are payable on parity with other subordinate obligations of GTC and legal covenants are standard for commercial paper transactions. The program will allow GTC to meet its short-term borrowing needs. Fitch currently rates GTC's senior unsecured debt 'AA-'. The Rating Outlook is Stable.

The short-term rating reflects the system's stable financial performance and ample liquidity available to support the program, as well as GTC's overall credit profile. Financial results compare well with those of other cooperative systems, reflecting sufficient debt service coverage and days cash on-hand. Support also comes from GTC's predictability and stability of revenues as an essential electrical service with very little business risk compared to greater competition and uncertainty associated with electricity generation. Additional support for the rating includes the member systems' 1996 reaffirmation to pay all of GTC's committed costs via joint and several take-or-pay commitments, extending through the year 2025, and the member systems solid financial position. GTC's member systems also benefit from their favorable revenue base (over 70% of revenues are from residential customers) and exceptionally strong annual demand and consumers growth of 6.8% and 4.5%, respectively, over the past five years.

Credit risks include future technology risk, such as fuel cells or other distributive generation, as well as potential environmental regulation and siting/right-of-way issues that could increase the cost of new transmission projects. There are also questions with respect to the Federal Energy Regulatory Commission (FERC) Standard Market Design (SMD) NOPR of July 31, 2002, which deals with pricing, regional planning and resource adequacy issues, and how this might impact on bulk transmission planning for GTC. GTC has indicated an interest in participating in the SeTrans RTO, which consists of several southern municipal electric systems, electric cooperatives and investor owned utilities. While GTC is attempting to comply with these proposals, it is not subject to FERC regulation and can not be required to join in an RTO.

As of June 30, 2002, GTC had assets in excess of $1 billion, projected operating revenues of $165 million and total transmission lines (miles) of 2,538. Capital expenditures for the period 2002 through 2005 are projected to exceed $500 million. During construction, GTC expects to use commercial paper and committed and uncommitted lines of credit for funding. Permanent funding would come from RUS loans, institutional lenders (i.e. Co Bank and CFC), public bond offerings and equity.

GTC was incorporated in 1996 as part of a corporate restructuring in which Oglethorpe Power Corporation (OPC) was divided into three separate operating companies -- GTC, the transmission system, OPC, the power supplier, and Georgia System Operations Corp., the operations business. GTC's principal business is providing network transmission services for the members' power purchases from OPC. GTC is entirely owned by its 39 cooperative members, and operates on a not-for-profit basis.