Reliant Resources, Inc., Houston, Texas, U.S., today announced that it plans to mothball or retire 622* MW of capacity at certain peaking plants and units that serve the PJM Interconnection (Pennsylvania-New Jersey-Maryland). The company will review these plans with state and federal regulatory agencies and other parties responsible for maintaining system reliability prior to taking action.

The 20 generating units involved were commissioned at various times from 1970 to 1972 and are located at four sites in Pennsylvania and three sites in New Jersey. The capacity involved represents less than 1 percent of PJM total summer operating capacity.

The 56-MW Wayne combustion turbine, in Crawford County, Pennsylvania, will be retired because continuing to operate it would entail a costly turbine overhaul. The other 566 MW of capacity will be mothballed. Plants/units to be mothballed in Pennsylvania include Warren, 57 MW; Shawnee, 20 MW; and Blossburg, 19 MW. Plants/units to be mothballed in New Jersey include Glen Gardner, 160 MW; Werner, 212 MW; and Gilbert (combustion turbines only), 98 MW.

"In conjunction with a broad review of our wholesale business model, we have identified a number of peaking units that currently have revenues insufficient to cover operating expenses. These units are rarely dispatched due to newly added, more efficient generation capacity that has already come on-line and, additionally, will be negatively impacted by new generation expected to come on-line in the near future," said Bob Harvey, executive vice president, power generation and supply.

According to PJM, during 2002-2003 more than 7000 MW of new combined- cycle gas turbine and gas turbine peaking capacity became operational in the PJM Interconnection, including Reliant's 795-MW Hunterstown combined-cycle plant in Pennsylvania. Another 2000 MW of capacity is forecast to become operational by August 2004.

"Prior to implementation, we intend to review today's decision with officials of the PJM Interconnection, the Mid-Atlantic Area Council of the North American Electric Reliability Council, as well as with FirstEnergy Corp., with respect to interconnection, transmission and system reliability implications," Harvey said. "We continue to evaluate an additional 470* MW of marginal peaking capacity for future mothballing or retirement should market conditions deteriorate further," he added.

After mothballing or retiring these 20 units, Reliant will own or operate approximately 4200 MW* of net generation capacity serving the PJM Interconnection. The total does not include 521 MW* of new generation that will come on-line later this year when Reliant's new Seward waste-coal fired plant in Pennsylvania becomes commercially operational.

(*Note: Summer operating capacity. On a summer-winter average basis, the capacity identified for mothballing totals 661 MW and the capacity identified for retirement totals 66 MW.)