RICHMOND, Va. and VALLEY FORGE, Pa. - Dominion
(NYSE: D) and PJM Interconnection, LLC, announced Tuesday the companies have
executed an agreement to have Dominion's 6,000 miles of transmission lines operated
on a regional basis by PJM, administrator of the world's largest competitive,
wholesale electricity market.
The memorandum of understanding signed by both companies
establishes a process for Dominion to become a member of the PJM regional transmission
organization, contingent on certain conditions.
"Dominion's decision was based on very careful deliberation,"
said Edgar M. Roach Jr., president and chief executive officer, Dominion Virginia
Power. "Robust, wholesale markets are the foundation of robust retail markets.
The established wholesale electricity markets covered by the PJM Interconnection
will provide access to a larger competitive market and ensure continued reliability
for our customers. PJM is simply the best option for Dominion."
In making its decision, Dominion considered input from state
and federal regulators, wholesale and retail power customers and other interested
parties.
Under terms of the agreement, Dominion would establish PJM
South, which is similar to the newly established PJM West, and would allow Dominion's
control area to be operated separately under the single PJM energy market. Both
parties have 120 days to finalize specifics of the agreement, which states that
Dominion's transmission assets will be fully integrated into the PJM market
as soon as possible.
"We are extremely pleased to be working with Dominion,"
said Phillip G. Harris, president and chief executive officer-PJM. "The
region's vibrant and robust wholesale energy market will be strengthened with
this effort - one that will focus on an integration to a standardized market
in a manner that best serves the needs of the public, the individual states
and governmental agencies."
The agreement between Dominion and PJM is subject to approvals
by the Federal Energy Regulatory Commission, the Virginia State Corporation
Commission and the North Carolina Public Utilities Commission.
Dominion is one of the nation's largest producers of energy,
with a production capability of more than 3 trillion British thermal unit of
energy per day. Dominion has a diversified and integrated energy portfolio consisting
of nearly 24,000 megawatts of generation, 5.1 trillion cubic feet equivalent
of proved natural gas reserves, 7,600 miles of natural gas transmission pipeline
and the nation's largest underground natural gas storage system with more than
950 billion cubic feet of storage capacity. Dominion also serves 3.9 million
franchise natural gas and electric customers in five states. In addition, Dominion
owns a managing equity interest in Dominion Fiber Ventures LLC, owner of Dominion
Telecom. For more information about Dominion, visit the company's Web site at
www.dom.com.
PJM, the country's first fully functioning regional
transmission organization, operates the world's largest competitive wholesale
electricity market and North America's largest power grid. The company currently
coordinates a pooled generating capacity of more than 71,600 megawatts and operates
a wholesale electricity market with more than 200 market buyers, sellers and
traders of electricity. PJM has administered more than $9 billion in energy
and energy service trades since the regional markets opened in 1997. More than
70 nations have sent delegates to PJM to learn about its market model and the
operation of the grid in a region including more than 25 million people in all
or parts of PA, NJ, MD, DE, OH, VA, WV and the District of Columbia. With the
April 1, 2002, addition of PJM West, for the first time nationally two separate
control areas now operate under a single energy market and a single governance
structure across multiple North American Electric Reliability Councils. Visit
PJM at www.pjm.com.
