Sithe Energies Wins Bid For Generating Assets Of Boston Edison.

NEW YORK--(BUSINESS WIRE)--Dec. 10, 1997--

$657 Million Agreement Includes 12 Power Plants;

Represents 2,000 MW Of Generating Capacity

Sithe To Spend An Additional $1 Billion Over Three Years

In Developing New, Environmentally-Sound Facilities

On Existing Sites That Will Generate An Additional 2,800 MW

Sithe Energies, Inc., a privately held company, today announced that it has signed a definitive agreement to purchase the non-nuclear generating assets of Boston Edison (NYSE:BSE), located in Massachusetts and Maine. Sithe also announced that it plans to spend more than $1 billion over the next three years in constructing new, highly-reliable and environmentally-sound plants at several of the existing Boston Edison sites. When completed, the state-of-the-art plants will generate an additional 2,800 megawatts (MW) of electric power.

Under the terms of the agreement, Sithe will pay $657 million for 12 power plants currently generating 2,000 MW of electricity. With the Boston Edison assets, Sithe will double its current capacity in North America to more than 4,000 MW.

Said William Kriegel, Chairman, Chief Executive Officer and President of Sithe, "Boston Edison deserves congratulations for being among the leaders in the utility industry and for becoming a model for electricity deregulation in the United States. Boston Edison, the Massachusetts Department of Public Utilities and the other signatories of the landmark Massachusetts Restructuring Act, showed great foresight in crafting an agreement that brings increased competition to the power industry and tangible benefits to consumers in the form of lower-cost electric energy."

Noting that the Company had not yet selected the specific locations where it would build the new plants from among five potential existing sites, Kriegel said Sithe would work quickly to identify those that would be the most economical and competitive.

He continued, "We expect that the construction and operation of the new facilities will require an experienced, well trained labor force, resulting in increased employment opportunities in the region, and it will help to further reduce the cost of electricity in the region."

The 12 power plants to be acquired by Sithe are: Mystic Electrical Generating Station, which is comprised of five independent generating units in Everett, MA (890 MW); New Boston Electrical Generating Station, which is comprised of two independent generating units and also the site of a oil-fired combustion turbine generator in South Boston (776 MW); Edgar Station in Weymouth, MA (21 MW); Framingham Station in Framingham, MA (32 MW); West Medway Station, which is comprised of three dual-fuel combustion turbine units (122 MW); Wyman Station in Yarmouth, Maine (36 MW).

While the Edgar Station, which is comprised of two turbine generators, only currently generates 21 megawatts, the 55-acre site previously housed 450 MW of generation and Boston Edison prepared detailed plans to develop a 1200 MW combined cycle plant on this site.

Said Barry F. Sullivan, Vice Chairman of Sithe, "Sithe has the management depth, plus the engineering and operating experience to deliver on the promise of deregulation for customers throughout New England. We also have the capacity and desire for continued growth, and our purchase of the Boston Edison generating assets is evidence of our determination to be a major presence in the evolving U.S. electricity market. We will continue to seek out additional acquisition opportunities that make sense for Sithe and local consumers of power."

Sithe currently operates 22 power plants in the United States, including six in New York State, six in California, four in Pennsylvania, three in Idaho and one each in New Jersey, North Carolina and Colorado.

The Company's 1,040 MW flagship Independence Station in Scriba, New York opened in 1994 and is recognized around the world for its state-of-the-art engineering and staffing efficiencies. The cleanest natural gas plant built in New York, Independence earned an endorsement from the Sierra Club, praising the plant for improving air quality. In 1995, Power magazine honored Independence Station with an award for achieving ultra-low NOx emissions with advanced gas-turbine technology. Independence continues to set industry records for reliability and availability.

Sithe also has an extensive global portfolio of projects under operation, construction or active development worth $5 billion. In Asia alone, 18 Sithe projects are under operation, construction or development, totaling 3,240 MW. Countries involved include China, India, Pakistan, the Philippines and Thailand.

Additionally, Sithe has 28 projects in other international locations, including Australia, Brazil, Canada, Columbia and Tunisia, totaling 3,770 MW.

In total, Sithe, including its domestic projects and the Boston Edison acquisition, will generate more than 11,000 MW of electric power when its planned development and expansion projects are completed.

Founded in 1984, Sithe is 60 percent owned by Compagnie Generales des Eaux (CGE), France's largest services company, 29 percent owned by Marubeni Corporation, a major Japanese trading company, and 11 percent owned by management.

CONTACT: Barry F. Sullivan Paul Verbinnen/Fred Bratman

Sithe Energies, Inc. Sard Verbinnen & Co.

212-450-9027 212-687-8080