Press Release

PUC Ends Reconsideration of Sale of 3 Water/Wastewater Companies Serving Customers in Eastern Pa.

Published on 9/28/2006

Filed under: Water and Wastewater

HARRISBURG – The Public Utility Commission (PUC) today ended its reconsideration of the sale of three water/wastewater companies serving customers in eastern Pennsylvania, placing no further conditions on the transaction.

        “This transaction is atypical for the water utility industry and we identified concerns about areas such as management and the experience as an owner and operator of the utility,” said Commission Chairman Wendell F. Holland. “We will continue to monitor the operations of the applicants, focusing on inadequate service and water quality standards.”

        The Commission voted 5-0 that no additional conditions should be placed on the stock transfer from Nuon Global Solutions USA Inc. to Hydro Star, LLC. Nuon Global owns Penn Estates Utilities Inc., Utilities Inc of Pennsylvania and Utilities Inc. – Westgate, all of whom provide water and/or wastewater utility service in the state.

         On Feb. 28, 2006, a stock transfer between the two companies became effective after no one filed an objection to a settlement, which was reached between the parties including the buyer, seller and the state’s Office of Consumer Advocate. On March 31, 2006, the Commission voted to reconsider the proceeding, expressing concerns about the transaction due to the status of the purchaser as an equity investor. The transaction was allowed to move forward while the Commission sought further information on specific issues in the case.

        Penn Estates Utilities Inc. provides water and wastewater service for more than 1,275 consumers in Stroud and Pocono townships, Monroe County. Utilities Inc. of Pennsylvania provides wastewater service to about 940 consumers and two elementary schools in West Bradford Township, Chester County. Utilities Inc. – Westgate provides water service for about 670 consumers near Bethlehem, Pa. AIG is a multinational insurance and financial services conglomerate operating in about 130 counties with a market cap of about $160 billion.

        The Pennsylvania Public Utility Commission ensures safe, reliable and reasonably priced electric, natural gas, water, telephone and transportation service for Pennsylvania consumers, by regulating public utilities and by serving as stewards of competition. For recent new releases, or more information about the PUC, visit our Internet homepage at www.puc.state.pa.us.

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Docket No. A-210072F0003; A-210063F0003; A230013F0004; A-210093F0002

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