Understandably, people are very interested to know where we will draw the water for the Twin River Energy Center co-production process. In fact, it's the question we get most often over all others. Like all energy facilities, Twin River will require a significant amount of water for cooling and process needs. We will generate electricity with a turbine that recycles steam by condensing the steam to water. Cooling water in the form of "make-up" water is required for this process. As we've stated in several public meetings, several water source options or combination of sources are possible and need to be fully evaluated. This will take a very detailed and lengthy feasibility study to finalize the selection and best sources. However, we think it's important to give residents more detailed information to alleviate concerns about any use of ground water or large-scale environmental impacts.

Twin River selected the cooling water system design that has the smallest footprint. We will use a well proven closed loop system with evaporative cooling towers. This type of cooling system is well proven and has been the most common selection for almost all thermal power generation facilities of all types and sizes for the past 20 years. In fact, this design has been selected for all the new natural gas combined cycle plants in Maine and NH. This popularity is due three basic reasons:

• Compared to "once through" cooling systems used for the previous generation of power plants in most of the U.S. including Maine Yankee and Mason Station, very little water is required to be withdrawn and no return discharge is required.

• If a new plant is to draw from a river, the plants need to be near but no longer right on top of the banks of a river or harbor which allows for other site layout features to take precedent including buffer zones to reduce visual, noise and light impacts.

• Water intake screens are only a fraction of the size of the old systems so intake location and design is more flexible. Less water use allows the smaller screens to easily meet the latest EPA intake design criteria.

The closed-loop system requires water to "make-up" for the water lost to cooling evaporation. This loss and make-up can be 90 to 95% of the total water needed of the project.

• The total water use requirement for the Twin River design is approximately 8.5 million gallons per day (MGD).

• The Twin River site is surrounded by abundant surface water sources. Most of the water supply adjacent to the site is brackish (salty) which ideally should be diluted by use of available fresh water supply to reduce treatment and membrane replacement costs. Nearby freshwater sources are being investigated to determine the most economical tradeoff between increased freshwater dilution and operating costs.

• NO GROUND WATER will be used because of the lack of any substantial aquifer near the site and concerns about salt water ingress into off-site wells.

• Use of the Wiscasset Water District for cooling operations is also not a viable option because of limited capacity and possible conflicts with long-term community growth plans. However, for the Twin River potable water use, the Wiscasset Water District is preferred and viable as the water consumption is comparable to approximately 60 residences.

• Use of 100% brackish water is a proven option and is used for the primary supply of cooling tower make-up at the 540 MW Con Ed combined cycle plant on the Piscataqua River in Newington, N.H.

• Use of 100% fresh water from surface water sources is also an option but would require sources outside the immediate area and Town of Wiscasset.

• Use of gray water (fully treated municipal waste water) is a viable option and may fit well with the Maine DEP, if its use displaces the demand on regional drinking water supply. The City of Bath has a significant supply of unused gray water and will be formally contacted as part of the effort to locate the best supply option. The Wiscasset gray water supply is available and should also be considered in the overall water supply evaluation.

The information outlined in the general summary above confirms that there are multiple options available. However, a far more rigorous engineering evaluation is required to determine the exact options to be used to be the most cost effective and environmentally responsible system design (brackish, fresh, gray or blended supply). Following this identification, further study is required to do a community acceptance assessment, environmental impact assessment and a comparative cost analysis of the supply, location and delivery options.

Hopefully, you can understand why the level of engineering analysis and negotiations required makes it too premature at this time to say exactly where, in what form, and in what combination we will attain the water. However, we have outlined above that plentiful options exist. We are evaluating and hopefully laid to rest any concerns about well water. As our analysis of the water supply continues and agreements reached, we will keep the municipalities and the general public informed and post our findings in the company's Web site ( www.twinriver energy.com ).