TEXT-S&P on U.S. Dept. of Energy Loan Guarantee Program

(The following statement was released by the rating agency)

July 8 - Standard & Poor's Ratings Services said today it published an
article titled "Update On The U.S. Dept. of Energy Loan Guarantee Program And
Standard & Poor's Rating Considerations," which provides details on the DoE's
loan guarantee process, our rating criteria, as well as methodological issues
specific to the program that have been the basis of numerous queries to
Standard & Poor's. In the article, we also attempt to estimate potential ranges
for credit subsidy costs under the LGP.

"These costs can be large, over 50% of the sponsor's equity investment in
the project in some cases," said Standard & Poor's credit analyst Swami
Venkataraman.

The DoE is currently accepting applications from the 16 innovative energy
technology projects that were selected for $4 billion in total loan guarantees
in round one of the program, which aims to encourage the commercial use of new
or significantly improved energy technologies that avoid, reduce, or sequester
air pollutants or greenhouse gas emissions. These projects focus on biomass,
fossil energy, industrial energy efficiency, solar energy, electricity
reliability, hydrogen, and alternative fuel vehicles. The DoE currently plans
to guarantee a total of $42.5 billion in debt under the program, including
specific technologies such as nuclear energy, renewable energy, and advanced
fossil energy projects.

A complete application for a loan guarantee must include a credit
assessment from a rating agency, which affects the subsidy fee the program
will pay. The credit assessment provides a rating reflecting the probability
of default and a recovery estimate reflecting the loss-given-default for the
project under a simulated default scenario.

Standard & Poor's has been a participant in the program's process from
the very beginning, responding to the DoE's request for comment in July 2007
and further opining on the potential credit impact of debt issued under the
program on the credit ratings of project sponsors in December 2007.

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(New York Ratings Team)