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Reliant Energy Commits $350 Million for Environmental Upgrades at Two Key Facilities, Other Improvements Planned

HOUSTON, July 5 /PRNewswire-FirstCall/ -- Reliant Energy today announced plans to install state-of-the-art emission control systems at two Pennsylvania power plants, a major step in the company's strategy for maximizing the long- term value of its power generation assets while reducing air emissions. Reliant Energy has estimated it could spend up to $625 million through 2011 on sulfur dioxide (SO2), nitrogen oxide (NOx), and mercury controls at the company's power plants.

The plans announced today call for the installation of a wet flue gas desulfurization system, or scrubber, at the company's Cheswick Generating Station in Springdale, Pa., and for funding Reliant's portion of the scrubber installation at the Keystone Generating Station near Indiana, Pennsylvania. Reliant jointly owns the Keystone station with six other entities and operates the facility on behalf of the owners.

Reliant estimates that its cost for the Cheswick scrubber and its portion of the Keystone project will be approximately $350 million. The scrubbers at both facilities are expected to begin commercial operation in 2009. These capital expenditures will be made over time with the majority being incurred from 2007 to 2009.

Installation of scrubbers at these units will remove approximately 98 percent of SO2 from the stations' flue gases, reducing Reliant Energy's SO2 emissions by approximately 68,000 tons per year. The systems will also be designed to maximize the removal of mercury.

"Reliant Energy is committed to caring for the environment and the communities where we do business, and this decision is significant from both perspectives," said Reliant Energy Chairman and Chief Executive Officer Joel Staff. "Investing in scrubbers on these units will contribute to improved air quality in Pennsylvania while improving the economic viability of these units for years to come. Not only is it the right thing to do for the environment, it makes good business sense."

In addition to the installation of scrubbers at the Cheswick and Keystone plants, the strategy includes upgrades to the existing flue gas desulfurization systems at Reliant's Elrama and Niles plants. These upgrades will be completed this year and are expected to increase SO2 removal efficiency. Modifications to significantly reduce SO2 emissions from Reliant Energy's Avon Lake facility are also being considered.

Reliant also continues to evaluate technologies that contribute to reduced SO2 and NOx emissions. For SO2 control, the company is testing switching to low-sulfur fuels, including Power River Basin coal. In addition, Reliant is considering installation of selective non-catalytic reduction (SNCR) systems for NOx reduction. These technologies hold promise as a mechanism for cost effectively reducing emissions at smaller facilities.

As part of this comprehensive plan for controlling emissions, Reliant continues its work with third-parties to host testing and development of new emission-control technologies, including advanced sorbents for mercury control, lime slurry injection and new duct injection technology for SO2 control, and waste coal slurry reburn for NOx control.

Reliant Energy, Inc. (NYSE: RRI) based in Houston, Texas, provides electricity and energy services to retail and wholesale customers in the United States. In Texas, the company provides service to approximately 1.9 million retail electricity customers, including residential, small business and commercial, industrial, governmental and institutional customers. Reliant also serves commercial, industrial, governmental and institutional customers in the PJM (Pennsylvania, New Jersey and Maryland) market.

The company is one of the largest independent power producers in the nation with approximately 16,000 megawatts of power generation capacity across the United States. These strategically located generating assets utilize natural gas, fuel oil and coal. For more information, visit http://www.reliant.com/corporate .

This news release contains "forward-looking statements" within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Act of 1934. Forward-looking statements are statements that contain projections, estimates and assumptions about our revenues, income, earnings and other financial items, our plans and objectives for the future, future economic performance, or other projections or estimates about our assumptions relating to these types of statements. These statements usually relate to future events and anticipated revenues, earnings, business strategies, competitive position or other aspects of our operations or operating results. In many cases you can identify forward-looking statements by terminology such as "anticipate," "estimate," "believe," "continue," "could," "intend," "may," "plan," "potential," "predict," "should," "will," "expect," "objective," "projection," "forecast," "goal," "guidance," "outlook", "effort", "target" and other similar words. However, the absence of these words does not mean that the statements are not forward-looking. We have based our forward-looking statements on management's beliefs and assumptions based on information available to management at the time the statements are made. Actual results may differ materially from those expressed or implied by forward-looking statements as a result of many factors or events, including legislative and regulatory developments, the outcome of pending lawsuits, governmental proceedings and investigations, the effects of competition, financial market conditions, access to capital, the timing and extent of changes in commodity prices and interest rates, weather conditions, changes in our business plan and other factors we discuss in our other filings with the Securities and Exchange Commission, including "Risk Factors" discussed in our most recent Annual Report on Form 10-K, Item 1A. Each forward-looking statement speaks only as of the date of the particular statement, and we undertake no obligation to publicly update or revise any forward-looking statement, whether as a result of new information, future events or otherwise.

Reliant Energy, Inc.

media, Pat Hammond, +1-713-497-7723, or investors, Dennis Barber, +1-713-497-3042, both of Reliant Energy, Inc.

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