New Jersey Successfully Concludes Basic Generation Service (BGS) Auction PSE&G and State's Other Utilities Secure Contracts to Continue Meeting Needs of All Electric Customers NEWARK, N.J., Feb. 11 /PRNewswire/ -- Public Service Enterprise Group (PSEG) said it is pleased that New Jersey's third Basic Generation Service (BGS) auction, the conclusion of which was announced today, has successfully secured the electricity requirements for customers of Public Service Electric and Gas Company (PSE&G), and the state's three other electric utilities. The New Jersey Board of Public Utilities (BPU) said this morning that it had approved the results of the state's third annual auction process that began on February 2. The process actually involved two concurrent auctions. One, the Commercial and Industrial Energy Price (CIEP) or Hourly Energy Price (HEP) auction, was to secure sufficient electricity to serve approximately 1,850 large business customers statewide, representing about 2,460 megawatts of load, for a one-year period. The other, a general Fixed-Price (FP) auction in tranches of one- and three-year periods, was to secure electricity to serve smaller business and all residential customers, representing about 15,500 megawatts of load. All periods begin on June 1, 2004. The BPU has issued a news release providing results of the auction. A copy is attached. In the general auction, PSE&G's clearing price for the one- year tranche was 5.479 cents per kilowatthour. For the three-year tranche, it was 5.515 cents per kilowatthour. E. James Ferland, chairman and chief executive officer of PSEG, praised the BPU for "once again conducting a highly efficient auction." He said the state's four electric utilities were able to secure all energy necessary to meet the requirements of customers. "The auction was very competitive, lasting seven business days, and this enabled PSE&G to achieve attractive prices for its electric customers," Ferland said. Ferland said PSEG Power, which is PSEG's wholesale energy business, participated as a direct bidder in the process. "The auction has helped us to achieve our ongoing objective of hedging better than 75% of Power's anticipated generation for the next 18 to 24 months," Ferland said. "Our successin securing contracts for our power output is a key element of our overall business plans," Ferland said. He confirmed PSEG's earnings guidance of $3.60 to $3.80 per share of common stock. Additional information about the auction process will available on the BPU's web site: http://www.bpu.state.nj.us/. FORWARD-LOOKING STATEMENT Readers are cautioned that statements contained in this press release about our and our subsidiaries' future performance, including future revenues, earnings, strategies, prospects and all other statements that are not purely historical, are forward-looking statements for purposes of the safe harbor provisions under The Private Securities Litigation Reform Act of 1995. Although we believe that our expectations are based on reasonable assumptions, we can give no assurance they will be achieved. The results or events predicted in these statements may differ materially from actual results or events. Factors which could cause results or events to differ from current expectations include, among other things: the effects of weather; the performance of generating units and transmission systems; the availability and prices for oil, gas, coal, nuclear fuel, capacity and electricity; changes in the markets for electricity and other energy-related commodities; changes in the number of participants and the risk profile of such participants in the energy marketing and trading business; the effectiveness of our risk management and internal controls systems; the effects of regulatory decisions and changes in law; changes in competition in the markets we serve; the ability to recover regulatory assets and other potential stranded costs; the outcomes of litigation and regulatory proceedings or inquiries; the timing and success of efforts to develop domestic and international power projects; conditions of the capital markets and equity markets; advances in technology; changes in accounting standards; changes in interest rates and in financial and foreign currency markets generally; the economic and political climate and growth in the areas in which we conduct our activities; and changes in corporate strategies. For further information, please refer to our Annual Report on Form 10-K and subsequent reports on Form 10-Q and Form 8-K filed with the Securities and Exchange Commission. These documents address in further detail our business, industry issues and other factors that could cause actual results to differ materially from those indicated in this release. In addition, any forward-looking statements included herein represent our estimates only as of today and should not be relied upon as representing our estimates as of any subsequent date. While we may elect to update forward-looking statements from time to time,we specifically disclaim any obligation to do so, even if our estimates change, unless otherwise required by applicable securities laws. DATASOURCE: Public Service Enterprise Group CONTACT: Paul Rosengren, +1-973-430-5911, or Karen Johnson, +1-973-430-6397, both of PSE&G Web site: http://www.pseg.com/ http://www.bpu.state.nj.us/

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