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Vectren's Electric Generation Positioned to Meet New EPA Requirements on Mercury, Other Emissions

As expected, the U.S. Environmental Protection Agency (EPA) issued more stringent rules last month regarding the regulated emissions of mercury and other pollutants. Given Vectren's significant investment in emissions control equipment over the past decade, the utility is in a position to largely comply with the new rules without significant additional customer impact.

Since 2001, Vectren has installed more than $410 million in emissions control equipment on its predominantly coal-fired generation fleet in southwestern Indiana. As a result, Vectren's electric generation fleet is now 100 percent scrubbed for sulfur dioxide, 90 percent controlled for nitrogen oxide and substantially controlled for particulate matter and a significant portion of mercury.

"Although we are still reviewing the complete details of the EPA's report, we are pleased our previous investment in air quality for this region will help to address these new air quality rules," said Carl Chapman, Vectren's president and CEO. "We continue to believe we are among the best-controlled coal-fired utilities in the Midwest."

The new rules were released on Wednesday, March 16 and signal a continued trend by EPA to continue previously announced plans to further regulate coal-fired generation. According to the American Coalition for Clean Coal Electricity, investments needed to control mercury and other hazardous air pollutants to these proposed levels could cost the industry $100 billion by 2015.

"We made the decision several years ago to make these investments to improve the air quality for our region, and as such, our customers' rates have increased to reflect these costs," added Chapman. "However, we now find ourselves in a position to comply, while other regional utilities may be required to make significant expenditures to meet EPA demands or consider retiring some uncontrolled coal generation units."

Vectren has nearly 1,300 megawatts (MW) of generating capacity of which 1,000 MW is coal-fired. Vectren has two power plants: F.B. Culley in Warrick County and A.B. Brown in Posey County. The utility shares ownership of Warrick Unit 4, a 150-MW unit, with Alcoa. Vectren serves 142,000 electric customers in Dubois, Gibson, Pike, Posey, Spencer, Vanderburgh and Warrick counties.

About Vectren
Vectren Corporation (NYSE: VVC) is an energy holding company headquartered in Evansville, Ind. Vectren's energy delivery subsidiaries provide gas and/or electricity to more than one million customers in adjoining service territories that cover nearly two-thirds of Indiana and west central Ohio. Vectren's nonutility subsidiaries and affiliates currently offer energy-related products and services to customers throughout the U.S. These include infrastructure services, energy services, coal mining and energy marketing. To learn more about Vectren, visit http://www.vectren.com.