Launch of Procurement Exchange

United Utilities PLC
30 May 2000


LEADING EUROPEAN UTILITIES TO LAUNCH PROCUREMENT EXCHANGE


United Utilities is one of a now expanded group of twelve leading utilities
from across Europe who have thrown their weight behind an initiative to form
an independent procurement exchange.

Last month, United Utilities, Scottish Power and Northern Electric announced
that they were working with a group of European electricity and water
utilities to facilitate the formation and utilisation of an electronic portal
to secure the benefits of Internet-based procurement and were in active
discussions to further shape the portal and determine its initial membership.

Today's announcement marks a significant expansion of the scheme with nine
other companies joining the original three partners.  Discussions are already
underway with further important partners and participants who are expected to
join in shortly.

The exchange will provide an electronic marketplace open to both buyers and
sellers in the utilities industry.  The initial focus will be on the European
electricity and water industries.  In addition, the exchange will be designed
to improve the efficiency of procurement, supply chain management and capacity
utilisation.  The founding partners will work together to make the exchange
attractive for all companies by establishing a collaborative platform for all
industry participants.

In the first phase, the exchange will focus on catalogue purchasing, forward
and reverse auctions and procurement management information.

Any supplier, large or small, can participate and the approach will benefit
all suppliers by giving them greater market reach and reducing transaction
costs.

The consortium intends to begin Internet-based trading by late summer 2000.

The estimated collective annual procurement spend (including capital
expenditure, but excluding labour and fuel) of the founding partners exceeds
Euro 30 billion.  The partners plan to use the exchange for a substantial
proportion of their procurement.

An independent company will be created to own and operate the exchange.
Initially around 80 per cent of the equity in the new company will be owned by
the founding partners.  The remainder will be allocated to other industry
partners (including suppliers), management, staff, advisers and technology
providers.

A robust, scalable, open and independent technology platform will be chosen
following a thorough evaluation of alternative providers.

It is intended to prepare the company for an initial public offering (IPO) in
the future.

Appropriate regulatory approval will be sought for the initiatives.
John Roberts, Chief Executive of United Utilities, said: 'The launch of this
innovative electronic exchange will bring together many of Europe's major
utility players in an exciting venture set to deliver major benefits.  When it
is up and running it will offer all participants the opportunity to improve
performance, productivity and capital efficiency.'


Note:

The 12 utilities which have agreed to work together towards the launch of the
electronic procurement exchange are: 

United Utilities, Scottish Power, Northern Electric, Endesa, EdF, ENEL, RWE,
Electrabel, Vattenfall, Iberdrola, NUON, NGC

United Utilities' ordinary shares trade on the London Stock Exchange and its
ADRs, each equal to two ordinary shares, trade on the New York Stock Exchange
under the trading symbol UU.