Press Releases

US Renewables Group Agrees to Acquire Niagara Falls Generation Facility

October 18, 2006

LOS ANGELES, CA - USRG Power & Biofuels Fund II, L.P. (USRG-II), which is managed by US Renewables Group, LLC (USRG), announced today it has entered an agreement to acquire 100% of the membership interests of WPS Niagara Generation, LLC from WPS Energy Services, Inc., the nonregulated subsidiary of WPS Resources Corporation (NYSE: WPS) for $30.2 million. WPS Niagara Generation owns the 53-megawatt Niagara Falls generation facility located in Niagara Falls, New York. USRG-II intends to convert the facility from coal and tire-derived fuel (TDF) to biomass and TDF.

The proposed sale is subject to Federal Energy Regulatory Commission and New York State Public Service Commission approvals. The sale is subject to certain working capital and other post-closing adjustments. Closing on the transaction is expected to occur in the first quarter of 2007.

USRG-II will invest additional capital to modify the facility's fuel feeding system and fuel yard to utilize a greater percentage of biomass and TDF. The facility is already permitted to use a mix of these fuels. USRG-II expects to operate the facility intermittently during 2007 while completing the capital investment program, with the upgraded facility operational by the fourth quarter of 2007.

Jim McDermott, Managing Partner of US Renewables Group, LLC, said, "USRG brings a unique combination of capabilities and innovation to investing in the renewable energy and clean fuels sector. With the Niagara transaction, we see the opportunity to convert a flexible coal-fired facility to a significant provider of baseload renewable energy. The refurbished plant will be an important part of the growth of clean energy in New York State. We look forward to a successful relationship with the various stakeholders in the Niagara Falls plant."

USRG has formed a new entity called USRG Niagara Biomass, LLC to complete the acquisition. USRG Niagara Biomass is a joint venture between USRG and Niagara Biomass Power, LLC, a company founded by two leading developers in the renewable energy industry.

Media Contacts:

Steven Gottlieb
ZENO Group
Tel: (877) 526-0450
steven.gottlieb@zenogroup.com