News Release
March 30, 1999

UI UPS INVESTMENT IN BRIDGEPORT ENERGY

The United Illuminating Company will increase its financial investment in Bridgeport Energy LLC, a limited liability company that owns and is constructing a 520-megawatt, combined-cycle natural gas-fired merchant generating plant in Bridgeport, Conn.

Following recent approval by its Board of Directors, the New Haven-based electric utility - through an unregulated subsidiary - will exercise its option to increase its current 4% investment to 33% in Bridgeport Energy, pending final agreement on a closing date. This investment is expected to increase UI’s annual earnings per share by l0cents to 15 cents.

Under its original agreement with Duke Energy Power Services, an affiliate of Duke Energy Corporation, the majority owner, UI had an option to invest up to one-third ownership in Bridgeport Energy LLC. This increase is strictly a passive financial investment by United Resources, Inc., (URI) a wholly owned unregulated UI subsidiary, said Nathaniel Woodson, UI chairman, president and chief executive officer.

"By our actions, we aren’t proposing to re-enter the generation business," Woodson said. "This investment is purely a financial opportunity for us, which became available because of our unique position in the region.

"It also provides us with the opportunity to profitably re-deploy into similar assets part of the capital that will be available from the sale of our fossil-fueled plants," Woodson added.

URI serves as the parent corporation for several unregulated businesses, each of which is incorporated separately to participate in business ventures that complement UI’s regulated electric utility business and provide long-term rewards to UI’s share-owners.

Bridgeport Energy is one of many investments UI is either participating in or considering as the company positions itself for the future in a restructured industry, Woodson said.

Construction of the multimillion merchant facility began in October 1997 on land on UI’s Bridgeport Harbor Station property. By July 1998, two simple-cycle gas turbines provided Connecticut with 340 much-needed megawatts during the summer’s peak power needs. Another 180 megawatts are expected to go on-line later this year when Bridgeport Energy converts to combined-cycle.

Duke Energy Corporation (NYSE: DUK) is a global energy company with more than $26 billion in assets. Headquartered in Charlotte, NC, the company reaches into more than 50 countries, producing energy, transporting energy, marketing energy and providing energy services. In the United States, Duke Energy companies provide electric service to approximately two million customers in North Carolina and South Carolina; operate interstate pipelines that deliver natural gas to various regions of the country; and are leading marketers of electricity, natural gas and natural gas liquids. Additional information about the company is available on the Internet at www.duke-energy.com.

UI is a New Haven-based utility that provides electricity and energy-related services to nearly 314,000 customers in 17 municipalities in the Greater New Haven and Greater Bridgeport areas. UI’s World Wide Web address is www.uinet.com. UT is traded on the New York Stock Exchange under the symbol UIL.

Contact: Fran Mayko
Phone: (203) 499-2817
24 Hour Phone: (203) 499-2812
Email: media_relations@duke-energy.com
Contact: Kurt Mohlman
Phone: (203) 499-2592
24 Hour Phone: (203) 499-2812
Email: media_relations@duke-energy.com