PG&E Receives Approval for Cow Power

SAN FRANCISCO, Aug 24, 2007 /PRNewswire-FirstCall

Pacific Gas and Electric Company announced today that the California Public Utilities Commission has approved its gas purchase agreement with Microgy, Inc. ("Microgy"), a subsidiary of Environmental Power Corporation (Amex: EPG), to deliver up to 8,000 Mcf of pipeline quality renewable natural gas daily. The methane gas, captured from cow manure, will be generated by Microgy facilities in California.

The agreement allows PG&E to purchase from Microgy 8,000 Mcf of renewable natural gas. Mircrogy plans to construct four production facilities on the site of large dairy farms in California and interconnect those systems to PG&E's extensive gas pipeline network. In addition to producing renewable energy, each of these facilities can produce significant greenhouse gas benefits by capturing methane from cow manure.

"Biogas is a triple win for California," said Roy Kuga, vice president of energy supply, PG&E. "It delivers clean, renewable energy to our customers, improves the air quality of the communities we serve and provides farmers with a new revenue stream that would otherwise go unutilized."

Cow power is the newest and most innovative way PG&E is realizing its renewable energy goals. As Microgy constructs state-of-the-art gas-generating facilities on dairy farms across the central valley, California consumers will benefit from a new source of renewable, environmentally-friendly energy. PG&E is also exploring other projects that will demonstrate the viability of converting biomethane to pipeline quality gas for use in power plants.

PG&E currently supplies 12 percent of its energy from qualifying renewable sources under California's Renewable Portfolio Standard (RPS) program. With more than 50 percent of the energy PG&E delivers to its customers coming from generating sources that emit no carbon dioxide, PG&E provides among the cleanest energy in the nation. PG&E continues to aggressively add renewable resources and is on target to exceed 20 percent under contract or delivered by 2010.

SOURCE Pacific Gas and Electric Company

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