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OPENING REMARKS OF EPSA PRESIDENT & CEO JOHN E. SHELK AT EPSA/COMPETE SPRING FORUM

Spring Forum Co-Hosted by EPSA and the COMPETE Coalition
"Driving Innovation for a Cleaner Future: The Power of Competitive Electricity Markets"

<center>Ronald Reagan Building & International Trade Center
Washington, D.C.

June 14, 2007</center>

Good morning ladies and gentlemen and thank you for joining us at the Ronald Reagan Building & International Trade Center for this important event. Today's proceedings are being web cast live. The web broadcast will be archived and available on the EPSA and COMPETE Coalition web sites.

I'm John Shelk, president of the Electric Power Supply Association. It is my pleasure to welcome you to today's Spring Forum co-hosted by EPSA and the COMPETE Coalition. EPSA is the national trade association for competitive power suppliers, including generators and marketers. We are joined today by several of EPSA's state and regional partners, including Angela O'Connor of the New England Power Generators Association and Gavin Donahue of the Independent Power Producers of New York.

The theme of today's conference is "Driving Innovation for a Cleaner Future: The Power of Competitive Electricity Markets." This morning's panel discussions will address two sets of issues - the first panel is on "Consumers, Competition and Environmental Benefits," while the second panel is on "Technology and Competitive Markets: Meeting Our Environmental Commitment." Each panel will be lead by a dynamic moderator who will guarantee a stimulating conversation. We encourage strong audience participation. The forum will be capped off by a major keynote address at lunch from FERC Commissioner Phil Moeller - someone who has been a leader on these important policy issues for many years, both in public service and in the private sector.

I am confident you will agree that these are timely topics. This large turnout attests to the fact that you do in fact agree. As we meet today, Congress is actively considering a variety of legislation in the House and Senate on energy and environmental issues, including how best to address climate change. At the same time, policymakers and stakeholders throughout the country are working to meet the nation's growing electricity needs in an affordable, reliable and environmentally responsible manner. These tasks have become even more challenging as the United States competes with growing economies around the globe for the fuels, materials and talents needed for new and existing power plants. A Standard & Poor's report issued just this week confirms the impact of global power demand on rapidly rising capital costs in the United States.

The heat of summer is almost upon us, which means that demand for electricity will increase along with thermometer readings. The good news is that experts are once again generally predicting that the nation's electricity systems will be up to the task of meeting that demand. However, those who are charged with monitoring electric reliability - and drawing our attention to issues that impact it - emphasize that there is little breathing room if a prolonged heat wave hits multiple regions at the same time as occurred last summer.

The competitive power sector is proud of its record. Competitive suppliers built almost all of the new power generation in the past decade using new, more efficient, cleaner gas-fired technology - and did so largely at the supplier's risk, not the ratepayer's. I have often heard it said that combined cycle gas technology might still be on the shelf - or at least not adopted as quickly - had it not been for the incentives created by competitive markets. One look at regions with little or no competition - where older, dirtier, less efficient plants operate while cleaner plants are idle - proves that point. The performance of existing nuclear and coal-fired assets dramatically improved in the hands of competitive suppliers as a result of restructuring. Getting much more out of the existing fleet has reduced emissions and partially reduced the need for new power plants, at least for a time.

Looking to the future, competitive suppliers are in the forefront of advancing new projects across a wide range of fuels and exciting new technologies. EPSA members are showing true leadership, and backing it up with billions of dollars in planned investments, in the areas of wind, geothermal and other renewables, the next generation of nuclear power plants, clean coal technologies, and much more that you will hear about later this morning. At the same time, we are working on demand response measures and how best to fashion organized markets to promote those measures.

All of these and other investments the nation needs to replace and expand an aging infrastructure will cost hundreds of billions of dollars in coming years and decades. The public has an understandable desire for substantial environmental improvement, including on climate change, from these investments. EPSA is the first - and thus far only - national association of fuel diverse electricity suppliers to support federal legislation for a national market-based system to address greenhouse gases. We look forward to continuing to work with Congress to enact what we call a "national and rational" approach consistent with EPSA's climate policy principles - a copy of which is available on the EPSA web site.

Two months ago the distinguished columnist Thomas Friedman penned an insightful article in the New York Times Sunday Magazine titled "The Power of Green." In it, he said "the next president will have to rally us with a green patriotism. Hence my motto: Green is the new red, white and blue." That motto should be on our minds during today's deliberations - particularly as today is Flag Day. He went on to write that "The only way we are going to get innovations ... is by mobilizing free-market capitalism." EPSA agrees. He concluded with words to guide this forum and our follow up to it - "An unusual situation like this calls for the ethic of stewardship" - concluding the article with "Our kids will only call us the Greatest Generation if we rise to our challenge and become the Greenest Generation."

Competitive suppliers are up to that challenge because competitive markets drive innovation. Today's forum is just one of many initiatives to make sure that environmental and electricity policies are properly aligned to allow that to continue to happen to benefit consumers.

In closing, let me say that at this point in the program we were looking forward to remarks by someone who is a recognized national leader for his bold support of competition and for his many contributions to the communities his companies serve. Unfortunately, Exelon CEO John Rowe is unable to be with us this morning. However, at this time I am pleased to present Bill Massey - a distinguished former member of the Federal Energy Regulatory Commission, one of the foremost experts on competitive electricity markets, and now counsel to our co-host, the COMPETE Coalition, to introduce the first panel and get us started. Please join me in a warm welcome for Bill Massey.

CONTACT: JOHN SHELK
(202) 349-0154or 703-472-8660

EPSA is the national trade association representing competitive power suppliers, including generators and marketers. These suppliers, who account for nearly 40 percent of the installed generating capacity in the United States, provide reliable and competitively priced electricity from environmentally responsible facilities serving global power markets. EPSA seeks to bring the benefits of competition to all power customers.