Construction of $500 Million Addition and Upgrade Underway at Arizona Coal-Fired Power Station

---

Researched by Industrialinfo.com (Industrial Information Resources, Incorporated; Houston, Texas). Tucson Electric Power (TEP), a subsidiary of Unisource Energy Corporation (NYSE: UNS) (Tucson, Arizona), has started construction of the 380 megawatt (MW) Springerville Unit 3 (PEC 43000306, Plant 1017737) located in Springerville, Arizona. TEP has signed to lease 100% of the equipment to Tri-State Transmission and Generation Association (Westminster, Colorado) who plans to utilize 200MW for own customers and has sold 100MW to Salt River Project Agricultural Improvement and Power District (Tempe, Arizona) for 30 years.

Bechtel Corporation (San Francisco, California) is the Engineering, Procurement & Construction (EPC) Turn-Key Contractor for the project and is utilizing Foster Wheeler Corporation (OTBC: FWLRF.OB) (Clinton, New Jersey), subsidiary Foster Wheeler Power Group Incorporated's pulverized coal steam generator (boiler) technology. The boiler will utilize Wyoming Powder River Basin low sulfur coal provided by Peabody Energy Corporation (NYSE: BTU) (Saint Louis, Missouri). The onsite coal handling system with dust suppression system is being provided by FMC Technologies Incorporated (NYSE: FTI) (Chicago, Illinois).

Mitsubishi Heavy Industries, a division of Mitsubishi Corporation (OTCB: MSHBY) (Tokyo, Japan), will provide the steam turbine generator set. The new unit will utilize a dry flue gas desulfurization (FGD) scrubber to further reduce SO2 emissions, along with selective catalytic reduction unit (SCR) and low NOx burners to reduce oxides of nitrogen. Baghouses (fabric filters) will be used to capture particulate matter, such as fly and boiler ash to be collected and sealed in on site landfills.

Construction started in mid November and included an additional $90 Million for environmental upgrades for Units 1 (PEC 43000429) and 2. The $500 Million project is to be completed, commissioned and operational by December 2006.