New Power Station

Scottish & Southern Energy PLC
12 July 2006


SCOTTISH AND SOUTHERN ENERGY VENTURE TO INVEST IN NEW COMBINED CYCLE GAS TURBINE
POWER STATION


Scottish and Southern Energy plc ('SSE') has entered into an agreement with ESBI
(Ireland's ESB International) to acquire 50% of the shares in Marchwood Power
Ltd, in anticipation of the construction of a new gas-fired power station near
Southampton with an installed capacity of around 850MW.


The site at Marchwood has consent under Section 36 of the Electricity Act for
construction of the power plant. When operational, SSE will supply all of the
fuel for the power station and take from it all of the electricity generated.
The power plant will be constructed under a turnkey contract and a long-term
maintenance agreement entered into with Siemens, the preferred gas turbine
supplier.


SSE and ESBI will each have 50% of the shares in Marchwood Power Ltd. It will be
financed on a non-recourse basis, with a likely debt/equity ratio of 80%/20%.
The total project cost is estimated to be around £400m, which means that SSE's
equity investment in the venture is likely to be around £40m.


The development is subject to the securing of non-recourse finance and the
finalisation of a power purchase agreement, which will determine issues such as
how the plant is to be operated and how it is to be remunerated for being
available to generate electricity. SSE and ESBI aim to achieve financial close
by the end of 2006.


Construction work is expected to start early in 2007, with the power station
being fully commissioned before the winter of 2009/10. Upon completion, the
station will be jointly operated by SSE and ESBI. It will have one of the
highest thermal efficiencies of any power station in the UK and in a typical
year will meet the electricity requirements of around one million homes.


Ian Marchant, Chief Executive of SSE, said: 'There is a clear consensus that the
UK will need a significant amount of new electricity generation capacity over
the next 15 years. At SSE, we have long recognised that adding to our
leading-edge generation portfolio is a key means of helping to deliver reliable
energy supplies and creating value for shareholders.


'This agreement is a major step forward in our ambitions to invest further in
gas-fired generation plant, which will complement our other investments in gas,
in coal-fired plant and in renewables. It will help SSE retain its position as
the largest non-nuclear generator in the UK, and the generator with the most
diverse portfolio of power stations. It will also help to keep the UK's lights
on.


'Following the announcement in May of our proposals to develop cleaner coal at
Ferrybridge, and our ongoing work in renewables, this investment in gas-fired
plant will complete the process of balancing our investment in electricity
generation.'


The UK's Minister for Energy Malcolm Wicks MP said: 'A major part of our energy
review was about enabling the power industry to deliver reliable and lower
carbon energy supplies for the UK over the long term. This announcement by SSE
and ESBI confirms that there is a significant appetite to invest in energy in
the UK and is a very welcome development.'

Ireland's Minister for Communications, Marine & Natural Resources, Mr Noel
Dempsey, T.D, commented: 'I warmly welcome the announcement of the joint venture
between ESBI and SSE in Marchwood in the UK. This agreement is further evidence
of international confidence in the experience ESBI has gained through its
operations both in the UK and worldwide.'


Enquiries to:

Scottish and Southern Energy
Alan Young, Director of Corporate Communications         0870 900 0410
Denis Kerby, Corporate Communications                    0870 900 0410







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