Our non-utility businesses principally comprise the operations of LG&E Capital Corp. (LCC), our primary holding company, and LG&E Marketing Inc. (LEM), our asset-based energy marketing subsidiary. LCC operates ten generating units in western Kentucky through its wholly-owned subsidiary, Western Kentucky Energy Corp. (WKE) and affiliates. It also has ongoing interests in Argentina and stakes in a number of power plants in the US through its wholly-owned subsidiary LG&E Power Inc. We also own CRC-Evans International Inc. (CRC), a company that leases equipment and provides services to the oil and gas pipeline industry.

 

Western Kentucky Energy (WKE)

Through WKE, LCC has a 25-year lease and operates the generating facilities of Big Rivers Electric Corporation (BREC), a power generation co-operative in western Kentucky, and a coal-fired facility owned by the city of Henderson, Kentucky, aggregating a total generating capacity of 1,771 MW. Over 2002, WKE generated almost 11 TWh of electricity. Approximately 89% of WKE’s net generation is used to serve BREC’s three member co-operatives and two regional aluminum smelters. Remaining power is sold into the wholesale electric market. As a non-utility entity, WKE is exposed to changes in fuel prices. To mitigate this exposure, WKE has entered into various interim-term fuel supply contracts and is pursuing the use of alternative fuels.

Argentine gas distribution operations

LCC owns interests in Argentine gas distribution operations which provide natural gas to approximately two million customers in Argentina through three distributors: Gas Natural BAN S.A. (Ban), Distribuidora de Gas Del Centro S.A. (Centro) and Distribuidora de Gas Cuyana S.A. (Cuyana). LG&E Energy’s operations in Argentina have been affected by the recent economic and political developments in Argentina.

LG&E Power Inc.

LG&E Power Inc., a wholly-owned subsidiary of LCC and its affiliates, owns, operates and maintains interests in six US independent power generation facilities. LCC also owns an interest in a wind power generation facility in Tarifa, Spain, and a minority interest in two US combined cycle gas generation facilities. LG&E Power Services (LPS), an affiliate of LG&E Power, also operates two 63 MW coal-fired facilities in the US under a medium-term operating contract with an independent third party utility.

CRC-Evans

CRC-Evans is a provider of specialised equipment and services used in the construction and rehabilitation of gas and oil transmission pipelines.

LG&E Energy Marketing

LG&E Energy Marketing (LEM) engages in asset-based energy marketing, which primarily involves the marketing of power generated by assets owned or controlled by LG&E Energy and its affiliates.