LG&E Energy is an energy services company with businesses spanning power generation, project development, retail gas and electricity supply and energy marketing. We are one of the lowest-cost energy providers in the US, and an industry innovator, operating in domestic and international markets from our North American headquarters in Louisville, Kentucky.

LG&E Energy is the US business of Powergen. LG&E Energy is a diversified energy services company with businesses in power generation and project development, retail gas and electric utility services, as well as asset-based energy marketing. Asset-based energy marketing primarily involves the marketing of power generated by physical assets owned or controlled by LG&E Energy and its affiliates.

LG&E Energy’s power generation and retail electricity and gas services are located principally in Kentucky and Virginia.

In 2002, we served more than one million customers, and at the end of the year, we owned or controlled aggregate generating capacity of approximately 10,333 MW, including leased and partially-owned capacity.

We divide our operations into regulated and unregulated businesses. The following chart shows the major subsidiaries of the LG&E Energy Group and the percentage held by LG&E Energy.

In the regulated business, LG&E Energy operates two utility subsidiaries:

• Louisville Gas and Electric Company (LG&E), an electricity and natural gas utility based in Louisville, Kentucky, which serves customers in
• Louisville and 16 surrounding counties;
• Kentucky Utilities Company (KU), an electricity utility based in Lexington, Kentucky, which serves 77 Kentucky counties and five counties in Virginia.

In the unregulated business, LG&E Energy owns stakes in a number of power plants in the US, three Argentine gas distribution companies and operates four coal-fired electricity generation plants in Western Kentucky, where it operates through Western Kentucky Energy Corp. and affiliates (WKE). LG&E Energy also owns CRC-Evans, a company that leases equipment and services to the oil and gas industry.

Within LG&E Energy, we view our key strengths as:

• Competent, dedicated and flexible employees;

• Nationally ranked low-cost energy provider;

• Excellent customer service and superior reputation with all stakeholders;

• A portfolio of more than 10,000 MW of low-cost, high-performance, strategically-located generation capacity.