EPCOR Power L.P. provides update on its investment in Primary Energy Recycling Holdings

EDMONTON, June 19 /CNW/ - EPCOR Power L.P. (TSX: EP.UN) (the Partnership) and EPCOR Power Equity Ltd. (TSX: EPP.PR.A) (the Corporation), a subsidiary of the Partnership, announces an update on its 15.4 per cent equity interest in Primary Energy Recycling Holdings LLC (PERH). As previously announced in September 2008, the Partnership and Primary Energy Recycling Corporation (TSX: PRI.UN) (PERC), which owns a majority interest in PERH, undertook a sales process for the possible sale of PERC and/or PERH. On June 19, 2009, PERC announced an update to the sales process. Final bids from potential buyers were submitted at the end of April 2009. The Board of Directors for PERC reviewed the final bids with its financial and legal advisors and in conjunction with the Partnership concluded that none of the offers would provide adequate value. PERH has indicated it intends to suspend dividends on its common shares. In 2008, the Partnership received approximately $3 million in annual dividends from its common shares in PERH, representing approximately 1.5 per cent of the Partnership's 2008 operating margin (before fair value changes on foreign exchange and natural gas contracts) (See Non-GAAP Measure). PERH also outlined plans to recapitalize the company, including the conversion of all of its preferred interests, including the Partnership's preferred interest, into newly issued common shares. In 2008, the Partnership received approximately $2 million in annual dividends from its preferred interests in PERH. The net book value of the PERH investment in the Partnership's financial statements at March 31, 2009 was approximately $17 million or 1.0 per cent of its total assets. The Partnership, PERC and PERH have agreed in principle on various changes to the current management agreement. The Partnership expects operating margins from the revised management agreement to remain unchanged. On June 7, 2009, the Partnership announced a revised, sustainable quarterly distribution level of $0.44 per unit. The potential impacts of the PERH actions were included in the determination of the Partnership's revised distribution level. The Partnership and PERC remain committed to optimizing the business and refinancing a US$135 million term loan in a PERH subsidiary that matures on August 24, 2009; however, there is no assurance that the refinancing will occur. Non-GAAP Measure The Partnership uses operating margin as a performance measure. Operating margin, which includes deferred revenues, is not a defined financial measure according to Canadian generally accepted accounting principles (GAAP) and does not have a standardized meaning prescribed by GAAP. Therefore, operating margin may not be comparable to similar measures presented by other enterprises. The Partnership uses operating margin to measure the financial performance of plants and groups of plants. A reconciliation from operating margin to net income before tax and preferred share dividends is contained in the Partnership's management's discussion and analysis for the year ended December 31, 2008 dated March 4, 2009 and filed on SEDAR at sedar.com. About EPCOR Power L.P. Established in 1997, EPCOR Power L.P. is a limited partnership organized under the laws of the Province of Ontario. The Partnership's portfolio consists of 19 wholly-owned power generation assets located in Canada and the United States, a 50.15 per cent interest in a power generation asset in Washington State, and an overall 15.4 per cent equity interest in Primary Energy Recycling Holdings LLC (PERH). The Partnership's assets have a total net generating capacity of 1,400 megawatts and more than four million pounds per hour of thermal energy. PERH wholly owns four recycled energy assets in the United States with an aggregate generation capacity of 283 megawatts and nearly two million pounds per hour of thermal energy, and has a 50 per cent interest in a pulverized coal facility. EPCOR USA Ventures LLC, formerly Primary Energy Ventures LLC, a wholly-owned subsidiary of the Partnership, manages and operates these facilities for PERH. For more information on the Partnership, please visit: [ www.epcorpowerlp.ca ]. About EPCOR Power Equity Ltd. The Corporation was incorporated under the laws of the Province of Alberta on June 26, 1998 and is a subsidiary of the Partnership. The Corporation operates as a holding company and indirectly holds all of the Partnership's business and power generation and other assets in the United States, including the Partnership's Curtis Palmer, Manchief, Frederickson, Naval Station, North Island, Naval Training Center, Oxnard, Greeley, Kenilworth, Roxboro, Southport and Morris power generating facilities. These facilities have a total generating capacity of approximately 1,080 megawatts (representing approximately 77 per cent of the total generating capacity of the Partnership's assets) and more than four million pounds per hour of thermal energy (representing 100 per cent of the total thermal energy capacity of the Partnership's assets). In addition, the Corporation holds, through a wholly-owned subsidiary, the Partnership's overall 15.4 per cent equity interest in PERH. For more information on the Corporation, please visit: [ www.epcorpowerlp.ca ].

For further information: Media inquiries: Tim LeRiche, (780) 969-8238; Unitholder and analyst inquiries: Randy Mah, (780) 412-4297, (866) 896-4636 (toll-free)

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EPCOR Power L.P. provides update on its investment in Primary Energy Recycling Holdings