New England Energy Alliance Report Cites Major Challenges in All Parts of New England Energy Infrastructure; Diverse Coalition of Companies and Organizations Form Regional Energy Alliance.

BOSTON -- New England faces major near-term challenges in all parts of its energy infrastructure including natural gas facilities, electric transmission lines and electric power generation, according to a report released today by the New England Energy Alliance.

The Alliance also released public opinion research results indicating that New England voters consider energy supply and prices as one of the top three most important issues facing the region and strongly support significant improvements to the region's energy infrastructure.

The report and the poll are the initial activities of the recently formed New England Energy Alliance, a coalition of energy providers, business and trade organizations, labor and others concerned about potential energy shortages and the impact on the region's economy. The Alliance will advocate for actions to ensure the availability, reliability and affordability of future energy supplies, which are vital to sustain economic growth.

The report was prepared for the Alliance by Analysis Group Inc. of Boston under the direction of Dr. Susan F. Tierney, former Assistant Secretary of Policy at the US Department of Energy and member of the National Commission on Energy Policy.

"Our assessment of the region's resources indicates that we are at a critical point today. Energy shortages could be acute soon - by 2010 at the latest. Since most of the region's energy investments are made in private markets which take time for project development, it means that policymakers need to act aggressively now to avoid problems in the future," said Dr. Tierney.

Concluding that there is no "silver bullet" to solve the region's energy challenge, the report makes the following findings and recommendations:

--Within two years, demand may exceed available supplies and delivery capacity for both electricity and natural gas.

--Uncertainties about policies affecting energy markets are chilling necessary new investment and must be addressed to induce investment in diverse capital-intensive projects.

--Energy efficiency should be a priority among many needed options.

--New natural gas supply and delivery capability, including import capacity for liquefied natural gas, along with new investment in power plants, electric transmission lines and renewable projects are needed for reliability and to improve competitive markets.

--To maintain fuel diversity and achieve price stability, the region should carefully consider the future of the region's existing larger generating facilities with more stable fuel prices, which include existing hydroelectric, fossil and nuclear plants.

In conjunction with releasing the report, the NEEA released public opinion research results indicating New England's voters view energy supply and prices among the top three most important issues facing the region. And by a two-to-one margin they favor new energy infrastructure; specifically 79% favor more transmission lines; 75% favor more natural gas plants and 72% favor an off-shore wind farm.

"The region's citizens recognize that energy infrastructure is a problem, they support development of more energy facilities and they want their policymakers to work with energy providers to address the issues getting in the way of needed development," noted Ernest Paicopolos, Principal of Opinion Dynamics Corporation, which conducted the poll for the NEEA.

"Energy is a vital link to New England's economic growth," said Carl Gustin, a former energy executive and the President of the NEEA. "That's why companies representing all segments of the industry involved in providing electricity and natural gas to New England, along with the region's leading business organizations, have joined together to form the Alliance. Our members and advisors share a common belief that significant investment in energy infrastructure, as well as in energy efficiency programs, is vital if energy markets are to work effectively and the economy is to grow."

According to Dr. Tierney, "the fact that the Alliance is bringing together a broad coalition from the energy industry and the region's business organizations underscores the importance of a reliable energy infrastructure to the region."

The report entitled New England Energy Infrastructure -- Adequacy Assessment and Policy Review notes that New England's energy costs are comparatively high. Of the eight states with the highest consumer energy prices in the nation, five are in New England. The report stresses that enhanced energy infrastructure and energy planning in New England may bring New England's energy prices to more competitive levels with the rest of the nation.

The report calls on policymakers to resolve several factors that are causing uncertainty for energy companies and energy investors in New England: regional carbon policy, federal and state rules governing the region's electric resource adequacy regime and community acceptance of infrastructure projects. Dr. Tierney noted that "the sooner these sources of risk and uncertainty are resolved, the sooner those investors will invest in infrastructure in the region."

Both the report and the public opinion survey are available on the Alliance's web site - www.newenglandenergyalliance.org. The NEEA will provide briefings to key policy and decision makers in the region on the findings of the report and the results of survey. Next year, it is planning a high profile agenda including surveying the region's largest energy users and largest employers, publishing a series of reports on various issues affecting the energy industry in the region, as well as conducting programs to gather expert opinions on solutions to be presented to government and industry leaders.

About the New England Energy Alliance: The New England Energy Alliance (NEEA) is a diverse coalition of energy providers, business and trade organizations, labor and others concerned about potential energy shortages and the impact on the region's economy. Corporate members include diversified companies with large electric power generating assets in the region (Entergy and Dominion Resources); electric transmission and delivery companies (National Grid, Northeast Utilities and Green Mountain Power); a diversified natural gas delivery and power generation company (KeySpan Energy); a company with pipeline, LNG and generation assets (TransCanada); a natural gas pipeline company (Iroquois Gas Transmission System); an LNG developer (Weaver's Cove); and an energy marketer (Constellation NewEnergy). NEEA's members also include the Edison Electric Institute and the Nuclear Energy Institute. Advisory council members include organizations representing businesses and consumers in the region: the Associated Industries of Massachusetts, the Massachusetts Business Roundtable, the Greater Providence Chamber of Commerce, the Business and Industry Association of New Hampshire and the Vermont Chamber of Commerce, as well as the Utility Workers United of America and individuals with broad experience addressing energy and environmental issues. For the list of current advisory council members visit the Alliance's website (www.newenglandenergyalliance.org), which will serve as a repository for studies, analyses, speeches and media reports on energy issues in New England.