Largest US fuel cell installation to date gets under way

BERLIN, Conn., March 27, 2001 à‚– The State of Connecticut has awarded a contract to Select Energy for the construction, operation, and maintenance of a state-of-the-art central energy plant to supply power to the Connecticut Juvenile Training School (CJTS) in Middletown.

Select Energy, the competitive energy marketing and services subsidiary of Northeast Utilities, won the contract with NU affiliate subsidiaries Select-HEC Inc. and Northeast Generation Services Company (NGS) in the Connecticut Department of Public Works’ competitive bidding process.

Select Energy’s Large Project Development group led the effort to create a unique contract proposal which includes six 200-kilowatt (kW) fuel cells connected in parallel to the region’s electric power grid. The project will cost approximately $18 million to construct and approximately $2 million annually to operate and maintain.

“We commend the CJTS project team for their commitment to energy efficiency, innovative technology, and fiscal due diligence. Select Energy’s combined resources were the perfect fit to meet the challenges of this energy infrastructure accomplishment,” said William Schivley, president of Select Energy. According to Michael Cassella, Select Energy’s director of new business and large project development, the project constitutes the largest single-site installation of grid-connected fuel cell technology in the country and perhaps the world.

CJTS’ new central energy plant will be housed in a facility now being constructed by Select-HEC, under an Engineering, Procurement, and Construction (EPC) contract, on a site provided by the State. When completed, the plant will supply on a guaranteed basis 1,200 kW of electricity, 9 million British thermal units (Btu) per hour of hot water, and 680 tons of chilled water under Select-HEC’s Operation and Maintenance (O&M) contract. This capacity output will serve all heating, cooling, and electrical power needs of CJTS’ 227,000 square feet of buildings including residences, greenhouse, and other campus facilities.

“This project is consistent with the Connecticut Legislature’s intent to have the state develop diversified energy sources with an ever-increasing percentage of that energy derived from renewable and fuel cell technologies,” said Select Energy’s Cassella, who also serves as the Connecticut Energy Advisory Board’s chairman.

Today’s announcement coincides with the closing of an innovative financing arrangement under which a group of financial institutions subscribed to “Certificates of Participation” in the plant’s lease to the State. This enabled the State to save money in financing costs.

Under the terms of the EPC and O&M contracts, Select Energy provides natural gas for the fuel cells and for standby generators; NGS is providing and servicing the fuel cells; and Select Energy Contracting Inc. will install and service the boiler and chiller systems.

As prime contractor for the project, Select-HEC is responsible for supplying both thermal and electrical energy, including back-up power through an interconnect to the local electric utility, while meeting rigorous environmental and performance standards. The term of the contract is 20 years with a 10-year renewal option; combined contract revenue is expected to exceed $100 million over 30 years.

The project’s fuel cells are manufactured by South Windsor, Connecticut- based International Fuel Cells, a subsidiary of United Technologies Corporation.

Select Energy is an integrated energy solutions company providing wholesale and retail energy supply, energy management and efficiency services, and facilities management and operation. Revenues in 2000 were approximately $2 billion. More information can be found on the Internet at www.selectenergy.com.

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