PUBLIC UTILITIES BOARD ADOPTS FISCAL YEAR 2005 BUDGET

ALAMEDA, Calif., August 1, 2004 — Late in June, the Public Utilities Board approved a budget for Alameda Power & Telecom's 2005 Fiscal Year. The new budget presents the resources available for both electric and telecommunications services.

During Fiscal 2005, Alameda Power & Telecom will remain one of Alameda's largest businesses. A budget of approximately $54 million will support electric operations, and a budget of approximately $24 million will support deployment of Alameda Power & Telecom's telecommunications services.

The City General Fund will benefit from over $3.6 million provided by Alameda Power & Telecom during the Fiscal Year. Electric operations will account for a transfer of $2,500,000 and a Payment in Lieu of Taxes of $445,000. Telecommunications Services is estimated to account for a Payment in Lieu of Taxes of $294,000 and Franchise Taxes totaling $422,000 during the Fiscal Year. By the close of Fiscal Year 2005, Alameda Power & Telecom will have transferred almost $86 million to the City since 1914.

Power costs are the largest items in the Alameda Power & Telecom budget for electric operations. Over $25 million, or about 53% of Electric Operating Revenues, will be spent for power by the end of Fiscal Year 2005. About 45% of the budget for telecommunications services, approximately $11 million, will be used for capital and other expenses necessary to build the system.

The Board's approval is the culmination of a 4-month effort. The Alameda Power & Telecom Fiscal Year 2005 began on July 1 and runs through June 30, 2005.