Allegheny Power Announces Approval of Pennsylvania Energy Efficiency and Conservation Plans

GREENSBURG, Pa. - (BUSINESS WIRE) - Allegheny Power, the electric distribution business of Allegheny Energy, Inc. (NYSE: AYE), announced that the Pennsylvania Public Utility Commission has approved a portfolio of energy efficiency and conservation plans that will help customers save energy and meet the goals of Pennsylvania's Act 129.

In response to Pennsylvania's Act 129, which requires electric distribution companies to provide programs for its customers to reduce electricity consumption, Allegheny proposed and received approval for energy efficiency programs for residential, commercial and industrial customers. Customers will be receiving specific information on these new Watt Watchers programs in the coming months. These programs are designed to help consumers use electricity efficiently, curb consumption and reduce overall demand for electricity.

"Allegheny is moving aggressively to introduce these new energy efficiency programs, which offer incentives for homes and businesses to save energy and money," stated Rodney Dickens, President of Allegheny Power. "We have designed a portfolio of programs that will provide meaningful reductions in energy usage and with the implementation of smart meters, we will offer customers new rate options and other tools for customers to better manage their electric bills."

The new programs approved by the Commission will include:

• Rebates for customers that purchase high efficiency appliances, lighting and heating and cooling systems;
• Residential home audits and rebates toward implementing audit recommendations;
• Home audit, weatherization and air conditioner replacement programs for low-income customers;
• New rate options that will provide financial incentives for customers to lower their demand for electricity or shift their usage to lower-priced times;
• Incentives for customers who install in-home devices that reduce electric usage when demand is highest; and
• Various programs for commercial, industrial, government and non-profit customers to increase energy efficiency and conservation.

Act 129 calls for the programs to be funded through customer rates. The typical residential customer using 1,000 kilowatt-hours a month will see an increase of about $2 per month. Customers who take advantage of one or more of the new programs have the opportunity to offset that amount and save much more over the years. Programs enabled by smart meters will be available in 2011.

Allegheny Energy

Headquartered in Greensburg, Pa., Allegheny Energy is an investor-owned electric utility with total annual revenues of over $3 billion and more than 4,000 employees. The company owns and operates generating facilities and delivers low-cost, reliable electric service to approximately 1.6 million customers in Pennsylvania, West Virginia, Maryland, and Virginia. For more information, visit our Web site at www.alleghenyenergy.com.

Forward-Looking Statements

In addition to historical information, this release contains a number of "forward-looking statements" as defined in the Private Securities Litigation Reform Act of 1995. Words such as anticipate, expect, project, intend, plan, believe, and words and terms of similar substance used in connection with any discussion of future plans, actions, or events identify forward-looking statements. These include statements with respect to: rate regulation and the status of retail generation service supply competition in states served by Allegheny Energy's distribution business, Allegheny Power; financing plans; demand for energy and the cost and availability of raw materials, including coal; provider-of-last-resort and power supply contracts; results of litigation; results of operations; internal controls and procedures; capital expenditures; status and condition of plants and equipment; capacity purchase commitments; regulatory matters; and accounting issues. Forward-looking statements involve estimates, expectations and projections and, as a result, are subject to risks and uncertainties. There can be no assurance that actual results will not materially differ from expectations. Actual results have varied materially and unpredictably from past expectations. Factors that could cause actual results to differ materially include, among others, the following: plant performance and unplanned outages; changes in the price of power and fuel for electric generation; general economic and business conditions; changes in access to capital markets; complications or other factors that render it difficult or impossible to obtain necessary lender consents or regulatory authorizations on a timely basis; environmental regulations; the results of regulatory proceedings, including proceedings related to rates; changes in industry capacity, development and other activities by Allegheny Energy's competitors; changes in the weather and other natural phenomena; changes in customer switching behavior and their resulting effects on existing and future load requirements; changes in the underlying inputs and assumptions, including market conditions used to estimate the fair values of commodity contracts; changes in laws and regulations applicable to Allegheny Energy, its markets or its activities; the loss of any significant customers or suppliers; dependence on other electric transmission and gas transportation systems and their constraints or availability; changes in PJM, including changes to participant rules and tariffs; the effect of accounting policies issued periodically by accounting standard-setting bodies; and the continuing effects of global instability, terrorism and war. Additional risks and uncertainties are identified and discussed in Allegheny Energy's reports filed with the Securities and Exchange Commission.

Allegheny Energy
Media contact:
Doug Colafella, 724-838-6387
Manager, Corporate Communications
Media Hotline: (888) 233-3583
E-mail: dcolafe@alleghenyenergy.com
or
Investor contact:
Max Kuniansky, 724-838-6895
Executive Director, Investor Relations
and Corporate Communications
E-mail: mkunian@alleghenyenergy.com