Alcoa Power Generating Inc.: Setting the Record Straight

Relicensing the Yadkin Project will not place North Carolina's water resources
in jeopardy

BADIN, N.C., March 31 /PRNewswire/ -- Despite recent claims made by Stanly
County officials, the relicensing of Alcoa Power Generating Inc.'s (APGI)
Yadkin Hydroelectric Project will not jeopardize North Carolina's water
resources. The new license, supported by 23 organizations in North Carolina
and South Carolina, will provide a host of benefits for North Carolina
including improved water quality, stronger habitat protections, land
conservation and new recreational opportunities.
"APGI has worked hard over the past 5 1/2 years with stakeholders across
the state to find a balance among all the interests in the Yadkin watershed,"
said Gene Ellis, APGI Licensing & Property Manager. "North Carolina's water
resources are not -- and never have been -- at risk."
Responsible Water Management During Drought Earns Praise for APGI
APGI's management of the water supply during the ongoing drought has
earned praise from North Carolina and South Carolina state agencies, local
homeowners associations and industrial users. It is one example of how we are
working with stakeholders to find solutions and protect the water supply
during periods of scarcity.
The new license will include a drought management plan that protects North
Carolina's water supply by requiring APGI to send less water downstream and
reduce hydropower generation during times of drought.
"Alcoa has voluntarily operated High Rock since last September in
accordance with the terms we all negotiated, even though they are not
technically bound to do so. As a result, we've survived the current drought
with great water levels and significant improvement in water quality. Talk to
fishermen and lake residents, you'll find everyone is enjoying the lake this
year," said Larry Jones, president of High Rock Lake Association.
Through careful management, APGI has kept water levels at our reservoirs
along the Yadkin River well above their historical averages throughout this
prolonged drought. All reservoirs in the Yadkin Project remain near full.
Understanding the FERC Process for Water Withdrawals
Claims that North Carolina's water supply is at risk are simply not true.
FERC has approved procedures that provide for new water withdrawals. These
procedures, developed in concert with North Carolina agencies, will not change
as a result of the relicensing process.
"We've been withdrawing water from the Yadkin River since the late 1940s.
Alcoa has worked closely with us to obtain FERC approval for our withdrawals,
and the Relicensing Settlement Agreement calls for an increase of four to five
times the amount of water we currently use," said Whit Whitley, Mayor of
Albemarle. "The city of Albemarle supports a new license for Alcoa and looks
forward to the many benefits it will provide."
During the current license term, FERC approved three new water withdrawals
and allowed a municipal water user to increase its water withdrawals from the
Yadkin River.
About the Relicensing of the Yadkin Project
The Yadkin Hydroelectric Project, owned and operated by Alcoa Power
Generating Inc. (APGI), is comprised of four dams and powerhouses along a
38-mile stretch of the Yadkin River in central North Carolina. The existing
50-year license from the Federal Energy Regulatory Commission (FERC) expires
in April 2008.
The federal relicensing of the Yadkin Project has been underway for more
than five years and has involved stakeholders from North Carolina and South
Carolina, including state agencies, local governments, environmental interest
groups, homeowners and businesses. A Relicensing Settlement Agreement --
signed by 23 organizations and submitted to FERC in May 2007 -- will improve
water quality, protect the water supply during drought conditions and provide
more than 6,000 acres to be used for recreation, conservation and game lands.
SOURCE Alcoa Power Generating Inc.

Robert Brown, +1-919-810-1901, robert@rbpr.com, for Alcoa Power Generating
Inc., or Gene Ellis, Licensing and Property Manager, Alcoa Power Generating
Inc., +1-704-422-5606 office, +1-704-796- 5824 cell, gene.ellis@alcoa.com