Countryside Power Income Fund
TSX : COU.UN

Countryside Power Income Fund

April 27, 2007 09:23 ET

Countryside Power Income Fund Announces Update On California SRAC Proceeding

ALJ issues Non-binding Proposed Decision

LONDON, ONTARIO--(CCNMatthews - April 27, 2007) -

NOT FOR DISTRIBUTION IN THE UNITED STATES OR OVER UNITED STATES WIRE SERVICES

Countryside Power Income Fund (TSX:COU.UN) (the "Fund") announced today that on April 24th 2007 an administrative law judge ("ALJ") issued a proposed decision to the parties in the proceeding pending before the California Public Utilities Commission ("CPUC") regarding possible modifications to the short-run avoided cost ("SRAC") pricing formula that applies to energy payments under power purchase agreements between qualifying facilities ("QFs") under the Public Utility Regulatory Policies Act of 1978 and investor-owned utilities located in the State of California.

In the proposed decision, the ALJ proposes adoption of specific policies and pricing mechanisms applicable to all three of California's investor-owned utilities' purchases of energy and capacity from QFs. For SRAC energy payments under existing QF contracts (including the Fund's two California cogeneration facilities), the ALJ proposes adoption of a new energy pricing formula based on market-based pricing indexes. However, capacity payments remain fixed, as designated in the QF power purchase agreements. While adoption of the proposed decision may reduce revenues during certain periods for the Fund's cogeneration facilities, the impact cannot be fully assessed by the Fund at this juncture given the tentative, non-binding nature of the decision and the uncertainties inherent in the newly proposed market-based SRAC pricing formula. The Fund, along with other similarly aligned QF interests, will strongly advocate for CPUC rejection of the ALJ's preliminary SRAC-pricing proposal in favor of alternative proposals reflecting a more favorable energy pricing formula.

The proposed decision is the ALJ's recommendation to the Commission, is subject to comment by parties to the SRAC proceeding and will become binding only upon a majority decision by the commissioners of the CPUC. The earliest a final, binding decision could be made by the CPUC is May 24, 2007; however, there can be no assurance that a conclusion will be achieved by that time frame in light of the complex nature of the proceeding and the significant number of parties participating in the proceeding.

The notice accompanying the release of the ALJ proposed decision stated that when the CPUC acts on the proposed decision, it may adopt all or part of it as written, amend or modify it, or set it aside and prepare its own decision. Only when the CPUC acts does the decision become binding and final.

Forward-Looking Statements

This press release may contain forward-looking statements relating to expected future events and financial and operating results of the Fund that involve risks and uncertainties. Actual results may differ materially from management expectations as projected in such forward-looking statements for a variety of reasons, including market and general economic conditions and the risks and uncertainties detailed from time to time in the Fund's annual information form dated March 26, 2007, and available on SEDAR. Due to the potential impact of these factors, the Fund disclaims any intention or obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, unless required by applicable law.

About Countryside Power Income Fund

Countryside Power Income Fund has investments in two district energy systems in Canada, with a combined thermal and electric generation capacity of approximately 122 megawatts, and two gas-fired cogeneration plants in California, with a combined power generation capacity of 94 megawatts. More information about the Fund is available at www.countrysidepowerfund.com.

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