Press Release Back Number(2006)

Start of Operations at IPP Project in Valladolid, Mexico Chubu Electric's first Mexican project

July 6, 2006
Chubu Electric Power Co., Inc.

A 525 MW natural gas combined cycle thermal power plant, a joint project of Chubu Electric and Mitsui & Co., Ltd. (below, Mitsui & Co.), began operations June 27 in Valladolid, Yucatan, Mexico.

Authorization to begin operations had been requested of Mexico's Comisión Federal de Electricidad, which was to make a decision after the actual start. Formal authorization to start operations was received yesterday.

The project is taking place under a 25-year power purchasing agreement with the Comisión Federal de Electricidad, which is supplying the natural gas used to generate the power. Chubu Electric and Mitsui & Co. in April of this year attained a 50% share each in the Valladolid project company after acquiring the 45% interest previously owned by Calpine Corporation.

Chubu Electric has been involved in all aspects of the project, in part by sending engineers and providing oversight of power generation equipment construction. Our goal is to use our expertise from operating combined cycle equipment in Japan to provide support for operations maintenance and ensure stable management of the project.

The Mexican project is our third overseas investment project to have started operation, the first two being a project to generate power from rice husks in Thailand (December 2005) and a power generation and saltwater desalination project in Qatar (May 2006).

For Chubu Electric, the five years from now until the end of FY2010 are a period of developing our overseas energy business, during which we will actively pursue both power generation as well as environmental projects overseas.

(Attachment)

Summary of Valladolid, Mexico IPP project

1. Project summary

2. Project scheme

3. Project site