ITC, AEP Study Outlines Extra-High Voltage Transmission Project in Michigan and Ohio

Sep 14, 2007

NOVI, Mich., Sept 14, 2007 /PRNewswire-FirstCall via COMTEX News Network/ --

ITC Holdings Corp., in collaboration with American Electric Power (AEP), has released the findings of a joint study evaluating the feasibility and benefits of building a new 765- kilovolt (kV) transmission network across Michigan's southern Lower Peninsula into Ohio. The study, originally undertaken to analyze transmission needs in Michigan, also details some of the regional benefits such an extra-high voltage electric infrastructure would provide to the Midwest.

The proposed 700-mile network would connect to existing AEP high-voltage systems in the southwest corner of Michigan and in Ohio and establish a regional transmission corridor capable of improving electric reliability, relieving power congestion, enhancing market access to the grid, and aiding in more efficient distribution of current generation. The network would run through the service territories of ITC subsidiaries International Transmission Company (ITCTransmission) and Michigan Electric Transmission Company, LLC (METC) and branch off of AEP's existing 765 kV network in northern Ohio.

"The results of this study very clearly support ITC's belief that continued economic growth, energy security and environmental stewardship in Michigan and the entire Midwest, rest firmly upon construction of state-of- the-art transmission projects like this 765 kV network," said Joseph L. Welch, president and CEO of ITC. "Further, this project supports the Midwest ISO's guiding principles to make the benefits of competitive energy available to customers, to provide a transmission infrastructure that safeguards local and regional reliability, to support state and federal renewable energy objectives and to ensure that investment in transmission happens in a timely manner."

"It is vital that today's interconnected electrical system be viewed and planned for on a regional basis," concurred T. Graham Edwards, President and CEO of the Midwest ISO. "This project, which touches customers in multiple states, clearly embraces that regional approach, and we look forward to discussing its integration with the balance of the region's plans."

    Specific findings in the report indicate that:



    -- The proposed 765 kV network would free up capacity on the existing 345

       kV system in Michigan's Lower Peninsula and accommodate transfer of as

       much as 5000 additional megawatts (MW) of electricity through the

       region.

    -- The project would decrease active power losses during peak conditions

       by 250 MW (essentially the equivalent of or displacing the need for a

       small generating plant.)

    -- A robust alternating current (AC) 765 kV transmission grid would

       improve reliability and capacity and magnify the benefits of all other

       solutions - including new generation - by integrating these solutions

       and Michigan into a powerful regional network of resources. The scale

       and capacity of this network would provide Michigan with a self-healing

       safety net that ensures one resource can instantly compensate for the

       absence of another in times of need.

    -- The project would enhance reliability, improve system efficiency, and

       open generation markets.  This is possible because 765 kV technology is

       a superior alternative to other transmission technologies and delivers

       a level of system reliability that could not be attained in its

       absence, even if new generation were added.

    -- A new 765 kV network would effectively address the objectives outlined

       in the federal Energy Policy Act of 2005, and the concerns outlined by

       Michigan regulators during their Capacity Needs Forum and 21st Century

       Energy Plan efforts.

    -- The proposed line would provide access to a broader range of

       competitive energy resources in the Midwest ISO and PJM Interconnection

       regional energy markets and increase transfer capability through

       Michigan.



AEP and ITC are proposing that the existing 765 kV transmission system that extends into the southwest corner of the Lower Peninsula of Michigan be expanded east across Michigan and south down to the existing 765 kV infrastructure in Ohio. This project will consist of three segments comprising approximately 700 miles of transmission infrastructure - roughly 420 miles in Michigan and 280 in Ohio - and will employ all available technological advancements to optimize corridor performance.

If built as proposed, the project is estimated to cost $2.6 billion in 2007 dollars and take approximately eight years to complete.

AEP and ITC are investigating the feasibility of forming a joint venture that would develop the project pending Midwest ISO and PJM Interconnection review of the project.

ITC and AEP have submitted the study results to the Midwest ISO and PJM Interconnection for consideration as these organizations move forward with future regional transmission planning. The study will also be shared with the Michigan Public Service Commission, the Public Utility Commission of Ohio and other interested commissions. Next steps are contingent upon receiving regulatory approvals.

About ITC Holdings Corp.

ITC Holdings Corp. (NYSE: ITC) invests in the electricity transmission grid to improve electric reliability, improve access to markets, and lower the overall cost of delivered energy. ITC is the largest independent electricity transmission company in the country. Through its subsidiaries, ITCTransmission and Michigan Electric Transmission Company (METC), ITC operates contiguous, regulated, high-voltage transmission systems in Michigan's Lower Peninsula serving a combined peak load in excess of 22,000 megawatts. ITC is also focused on new areas where significant transmission system improvements are needed through subsidiaries ITC Midwest, ITC Grid Development, ITC Great Plains and ITC Panhandle Transmission. For more information, please visit: http://www.itc-holdings.com. (itc-ITC)

About American Electric Power

American Electric Power is one of the largest electric utilities in the United States, delivering electricity to more than 5 million customers in 11 states. AEP ranks among the nation's largest generators of electricity, owning more than 38,000 megawatts of generating capacity in the U.S. AEP also owns the nation's largest electricity transmission system, a nearly 39,000-mile network that includes more 765 kilovolt extra-high voltage transmission lines than all other U.S. transmission systems combined. AEP's transmission system directly or indirectly serves about 10 percent of the electricity demand in the Eastern Interconnection, the interconnected transmission system that covers 38 eastern and central U.S. states and eastern Canada, and approximately 11 percent of the electricity demand in ERCOT, the transmission system that covers much of Texas. AEP's utility units operate as AEP Ohio, AEP Texas, Appalachian Power (in Virginia and West Virginia), AEP Appalachian Power (in Tennessee), Indiana Michigan Power, Kentucky Power, Public Service Company of Oklahoma, and Southwestern Electric Power Company (in Arkansas, Louisiana and east Texas). AEP's headquarters are in Columbus, Ohio.

About the Midwest ISO

The Midwest ISO ensures reliable operation of, and equal access to, 93,600 miles of interconnected, high-voltage power lines in 15 U.S. states and the Canadian province of Manitoba. The Midwest ISO manages one of the world's largest energy markets, clearing more than $2 billion in energy transactions monthly. The Midwest ISO was approved as the nation's first regional transmission organization (RTO) in 2001. The non-profit 501(C)(4) organization is governed by an independent Board of Directors, and is headquartered in Carmel, Indiana with operations centers in Carmel and St. Paul, Minnesota. Membership in the organization is voluntary. For more information, visit MISO.

Safe Harbor Statement

This press release contains certain statements that describe our management's beliefs concerning future business conditions and prospects, growth opportunities and the outlook for our business and the electricity transmission industry based upon information currently available. Such statements are "forward-looking" statements within the meaning of the Private Securities Litigation Reform Act of 1995. Wherever possible, we have identified these forward-looking statements by words such as "will", "may", "anticipates", "believes", "intends", "estimates", "expects", "projects" and similar phrases. These forward-looking statements are based upon assumptions our management believes are reasonable. Such forward looking statements are subject to risks and uncertainties which could cause our actual results, performance and achievements to differ materially from those expressed in, or implied by, these statements, including, among other factors, the risks factors listed in Part I, Item 1A - Risk Factors of our Form 10-K for the fiscal year ended December 31, 2006 (as updated in our Quarterly Report on Form 10-Q for the periods ended March 31, 2007, and June 30, 2007).

Because our forward-looking statements are based on estimates and assumptions that are subject to significant business, economic and competitive uncertainties, many of which are beyond our control or are subject to change, actual results could be materially different and any or all of our forward- looking statements may turn out to be wrong. Forward-looking statements speak only as of the date made and can be affected by assumptions we might make or by known or unknown risks and uncertainties. Many factors mentioned in our discussion in this release will be important in determining future results. Consequently, we cannot assure you that our expectations or forecasts expressed in such forward-looking statements will be achieved. Actual future results may vary materially. Except as required by law, we undertake no obligation to publicly update any of our forward-looking or other statements, whether as a result of new information, future events, or otherwise.

SOURCE ITC Holdings Corp.


http://www.itc-holdings.com

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