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WEST PENN POWER $61.5 MILLION POLLUTION CONTROL BONDS 'A' BY FITCH -- FITCH FINANCIAL WIRE --

 NEW YORK, March 4 /PRNewswire/ -- West Penn Power Co.'s $61.5 million 4.95 percent Washington County Industrial Development Authority (PA) pollution control revenue bonds (Mitchell Project) (tax-exempt) due 2003 are rated A' by Fitch.
 The rating reflects West Penn's significant capital and operating expenses associated with 1990 Clean Air Act expenditures and uncertain regulatory treatment by the Pennsylvania Public Utility Commission (PUC). The bonds are secured by notes, which represent a second lien on the flue gas desulfurization system, (scrubber) located at the Mitchell power station which has been in operation since 1963. Proceeds will be used to refund the authority's outstanding $30 million, 9.75 percent series 1983B and $31.5 million 9.5 percent series 1983C bonds.
 The PUC, which regulates 98 percent of West Penn's revenues, issued a noncommittal prudency decision on the company's clean air compliance plan and denied the company's request to recover actual clean air- related costs through a surcharge. As a result, West Penn's parent, Allegheny Power System, Inc. (APS) has not provided equity support for 1992 construction expenditures.
 APS plans to comply with Clean Air Act phase 1 requirements by building scrubbers at its mine-mouth Harrison plant for $726.6 million, including allowance for funds used during construction. West Penn's share is $311.1 million.
 In August 1992, West Penn requested a $92.8 million rate increase in Pennsylvania. About 41 percent or $38.1 million is for the recovery of Clean Air Act related construction work in progress. Administrative law judge and commission decisions are expected in March and May respectively.
 Total debt as a percent of capitalization was 50.3 percent at Sept. 30. Pretax coverage of interest excluding AFUDC and including AGC interest expense was 3.23 times for the twelve months ended Sept. 30, a decline from 3.33x at December 1991. Internal cash generation funded 46.2 percent of construction expenditures compared to 67.5 percent at Dec. 31, 1991. Without recovery in rates, higher expenses associated with the scrubber project are likely to cause these measures to weaken further.
 -0- 3/4/93
 /CONTACT: Josephine Zeppieri of Fitch, 212-908-0575/


CO: West Penn Power Co. ST: Pennsylvania IN: UTI SU: RTG

SM -- NY091 -- 8217 03/04/93 15:19 EST
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Date:Mar 4, 1993
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