MADISON, WIS., Jan. 19, 2006—Madison Gas and Electric (MGE) today announced its Energy 2015 Plan, which is another step forward in meeting our community's future energy needs. The comprehensive plan is reliable, economic and environmentally responsible and includes a balanced mix of energy efficiency, renewable energy and new clean-coal resources.

Highlights of Energy 2015 include:

• Eliminate coal burning at Blount Generating Station Power Plant at the end of 2011. Blount will continue to run on natural gas.

• Secure energy from new, clean-coal resources to help ensure an affordable, reliable energy supply mix.

• Grow MGE's wind resources by 5 to 10 times.

• Engage every customer in energy efficiency efforts to increase the conservation currently in our mix.

MGE has spent two years analyzing its options and believes this plan represents the best balance for serving our customers. The Energy 2015 Plan was informed by the series of "Community Energy Conversations" MGE held with its customers.

"This thorough, forward-looking plan will meet the Madison area's growing energy demands with a continued emphasis on energy efficiency, environmental stewardship and a balanced mix of energy supply," said Gary Wolter, Chairman, President and CEO. "For our energy future, we need a combination of renewable energy, energy efficiency and new reliable generation sources to serve one of the most vibrant local communities in our nation."

MGE will make significant changes at Blount which currently meets or exceeds all environmental regulations. However, future federal environmental regulations will require steep cuts in emissions from coal-fired power plants. MGE plans to discontinue coal use at Blount at the end of 2011 and retire the oldest, least-efficient part of the facility. The new federal environmental regulations would require substantial investments at Blount that would be expensive and problematic to site.

Blount will continue to burn natural gas, and the plant's 190-megawatt (MW) capacity will be reduced to 100 MW. MGE anticipates the Blount workforce will be reduced from 96 to 26 employees because fewer workers are needed to run a gas-fired facility. MGE is providing an unprecedented lead time to announce a facility change of this kind in our industry. MGE wants to give affected employees as much flexibility as possible and will work hard to reduce the number of layoffs by taking advantage of normal attrition.

MGE will secure replacement energy from purchase and/or investment in new clean-coal facilities to ensure a reliable, affordable mix of energy sources. Energy from these new plants will be cost-effective for our customers. The company also plans to increase its wind resources by 5 to 10 times and will explore other renewable generation sources.

MGE generates and distributes electricity to nearly 134,000 customers in Dane County and purchases and distributes natural gas to nearly 133,000 customers in seven south-central and western Wisconsin counties. MGE has served the Madison area since 1896

For more information
Energy 2015 Plan