Joint bid to develop $4 billion Upper Toba Valley and Bute Inlet Run-of-River Hydroelectric Projects on BC's Southwest Coast
Vancouver, BC -- August 14, 2008 -- Plutonic Power Corporation (PCC: TSX) and GE Energy Financial Services, a unit of GE (NYSE: GE), have signed a memorandum of understanding to partner on a bid to develop approximately 1,000 megawatts (MW) of clean, run-of-river hydroelectric capacity in the Toba and Bute Inlets along the southwest coast of British Columbia. With approximate capital costs of $4 billion, the joint investment would be the largest single private sector investment in hydroelectric generation in Canada.
Plutonic Power and GE Energy Financial Services intend to jointly bid the Upper Toba Valley and Bute Inlet Projects into the 2008 BC Hydro Clean Power Call Request for Proposals in November. Based on current assumptions, if the two entities' joint bid is accepted, GE Energy Financial Services intends to make an equity contribution of $70 million for a 50% interest in the Upper Toba Valley Project and either by itself, or with other partners, an equity contribution of $650 million for a 60% interest in the Bute Inlet Project. The final economic terms will be determined based on project variables including final capital cost, awarded energy price and estimates of power output. GE Energy Financial Services would also have the right to arrange debt financing for the projects. Prior to GE Energy Financial Services' equity contribution, Plutonic Power would be responsible for all costs of permitting, public consultation and environmental assessment certification. Plutonic may elect to repurchase a further 10% interest in the Bute Project by making a $100 million equity contribution to capital costs.
Completion of the transactions is subject to such conditions as completion of satisfactory due diligence; finalization of satisfactory documentation; approval of investment committees and boards of directors; successful bids into BC Hydro's Clean Power Call Request for Proposals; senior debt financing for the projects; and regulatory approvals.
Upon successfully acquiring an energy purchase agreement for Upper Toba Valley Project and Bute Inlet Project with BC Hydro, GE Energy Financial Services would be granted one million and four million warrants respectively, to purchase common shares in Plutonic Power Corporation. The warrants would be exercisable at a price equal to the market price for Plutonic's common shares at the time they are issued, have a term of five years and, be subject to vesting provisions.
"With the support of GE Energy Financial Services as our partner, we are confident in submitting a very strong bid into the BC Hydro Clean Power Call Request for Proposals in November," said Plutonic Vice-Chairman and CEO, Donald McInnes. "These projects have the potential to generate enough clean energy to meet the needs of over 300,000 homes and will position Plutonic and GE Energy Financial Services as leaders in the development of clean energy and reduction in reliance on fossil fuel-generated electricity by annually offsetting over 2.2 million tonnes of CO2 emissions."
"This bid strengthens the existing relationship between Plutonic and GE Energy Financial Services and, if successful, would significantly expand GE's renewable energy base in the province of British Columbia," said Mark Tonner, Managing Director for Canada at GE Energy Financial Services.
The Upper Toba Valley Project -- a series of three sites with a capacity of approximately 120MW -- and the Bute Inlet Project -- 18 sites with an approximate capacity of 900 MW -- are in the permitting and review stages of the Environmental Assessment Process. The Bute project is located north of the Toba Valley, where Plutonic and GE Energy Financial Services are already partnering on the $660 million, 196 MW East Toba River/Montrose Creek run-of-river hydroelectric power project. That project has been under construction since July 2007.
About Plutonic Power Corporation
Plutonic Power's vision is to provide leadership and create a legacy through the development of renewable, reliable, clean energy. Its proposed Green Power Corridor™, comprised of 40 facilities, including the flagship $660 million, 196 MW East Toba River/Montrose Creek run-ofriver project currently under construction, have the design capacity to generate enough energy to meet the annual needs of about 630,000 homes and create approximately 5,500 person years of employment. Once built, the Green Power Corridor™ could offset an estimated 4 million tons of CO2 emissions every year - the equivalent to taking as many as 650,000 vehicles off the road. Plutonic is committed to working in partnership with First Nations, stakeholder groups and local communities in the development of all its run-of-river projects. By developing its suite of projects, Plutonic Power will help British Columbia realize its goal of becoming electricity self-sufficient by 2016, meet demand utilizing 90% clean domestic generation sources and will play a significant role in the fight against climate change.
About GE Energy Financial Services
GE Energy Financial Services' 400 experts invest globally with a long-term view, backed by thebest of GE's technical know-how and financial strength, across the capital spectrum and theenergy and water industries, to help their customers and GE grow. With US $19 billion inassets, GE Energy Financial Services, based in Stamford, Connecticut, invests more than $5billion annually in two of the world's most capital-intensive industries, energy and water. Inrenewable energy, GE Energy Financial Services is growing its portfolio of more than $4 billionin assets in wind, solar, biomass, hydro and geothermal power. More information:www.geenergyfinancialservices.com.
About GE
GE is a diversified global infrastructure, finance and media company that is built to meetessential world needs. From energy, water, transportation and health to access to money and information, GE serves customers in more than 100 countries and employs more than 300,000people worldwide. For more information, visit the company's Web site at www.ge.com GE is Imagination at Work
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Elisha Moreno
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Ken Koprowski
GE Energy Financial Services
Office: 203-961-5743
Russell Wilkerson
GE Capital Managing Director of Communications and Public Affairs
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