ROANOKE TIMES 

                         Roanoke Times
                 Copyright (c) 1995, Landmark Communications, Inc.

DATE: SATURDAY, February 5, 1994                   TAG: 9402050043
SECTION: BUSINESS                    PAGE: A-4   EDITION: METRO 
SOURCE: Associated Press
DATELINE: RICHMOND                                LENGTH: Medium

UTILITIES WARY OF DUPONT VENTURE

Virginia's two largest electric utilities are upset with DuPont Co. over a new partnership that affects production of electricity at plants in Martinsville, Waynesboro and Chesterfield County. DuPont said earlier this week it will form a partnership with LG&E Power Inc. to own and operate energy production equipment at those plants and six factories from Delaware to South Carolina.

The partnership would break legal ground by involving a third party in the production of electricity for use by major retail customers of Roanoke-based Appalachian Power Co. and Virginia Power of Richmond.

"Virginia Power will monitor this situation closely," said James Rhodes, Virginia Power's president and chief executive officer. "State law prohibits any other entity from selling electricity at retail anywhere in Virginia Power's service territory."

Rhodes said the arrangement would lead to higher rates for utility customers. He added the company "will take whatever steps we deem appropriate to protect our customers' interests and hold down costs."

The partnership between DuPont and LG&E was announced Wednesday and dashed Virginia Power's hopes of winning contracts for DuPont's Spruance Fibers Plant in Chesterfield and its factory in Waynesboro.

The announcement came as more of a surprise to Roanoke-based Appalachian Power Co., which serves DuPont's nylon plant in Martinsville.

"We would echo Virginia Power's concern over the legality" of the arrangement, said Apco spokesman Don Johnson.

DuPont and LG&E said the partnership would not affect the amount of electricity the manufacturer buys from Virginia Power or other utilities in the region.

LG&E, based in Irvine, Calif., is an unregulated subsidiary of Kentucky-based LG&E Energy Corp. A final partnership agreement is expected to be reached in the coming months. 


 by CNB