Press Releases

If the merger closes before June 8, 2006, a pro-rated, or “stub” dividend will be paid within 30 days of the merger close to holders of record on the day before the closing. A second “stub” payment will be declared by the newly formed company, Exelon Electric & Gas, for the time period from the close of the merger to the first record date for Exelon Electric & Gas.

“Keeping PSEG shareholders whole with respect to their dividends was a critical element of the merger agreement with Exelon. The use of two stub-period dividends will ensure PSEG shareholders receive the equivalent of the 57 cent dividend for the quarter.” Ferland said.

The amount of the first stub payment will be calculated as $0.0062 per share per calendar day for the period beginning March 9, 2006 and ending on the day before the closing of the merger. The stub period payment is only effective if the merger closes prior to June 8, 2006. No action is required by shareholders.

PSEG is a diversified energy company (NYSE: PEG) located in Newark, NJ. Its subsidiaries include PSE&G, New Jersey’s largest combined electric and gas utility, PSEG Power, a major regional independent power producer and PSEG Energy Holdings, a holding company for other non-regulated businesses.

FORWARD-LOOKING STATEMENT

Readers are cautioned that statements contained in this press release about our and our subsidiaries’ future performance, including future revenues, earnings, strategies, prospects and all other statements that are not purely historical, are forward-looking statements for purposes of the safe harbor provisions under The Private Securities Litigation Reform Act of 1995. Although we believe that our expectations are based on reasonable assumptions, we can give no assurance they will be achieved. The results or events predicted in these statements may differ materially from actual results or events. Factors which could cause results or events to differ from current expectations include, among other things: the effects of weather; the performance of generating units and transmission systems; the availability and prices for oil, gas, coal, nuclear fuel, capacity and electricity; changes in the markets for electricity and other energy-related commodities; changes in the number of participants and the risk profile of such participants in the energy marketing and trading business; the effectiveness of our risk management and internal controls systems; the effects of regulatory decisions and changes in law; changes in competition in the markets we serve; the ability to recover regulatory assets and other potential stranded costs; the outcomes of litigation and regulatory proceedings or inquiries; the timing and success of efforts to develop domestic and international power projects; conditions of the capital markets and equity markets; advances in technology; changes in accounting standards; changes in interest rates and in financial and foreign currency markets generally; the economic and political climate and growth in the areas in which we conduct our activities; and changes in corporate strategies. For further information, please refer to our Annual Report on Form 10-K and subsequent reports on Form 10-Q and Form 8-K filed with the Securities and Exchange Commission. These documents address in further detail our business, industry issues and other factors that could cause actual results to differ materially from those indicated in this release. In addition, any forward-looking statements included herein represent our estimates only as of today and should not be relied upon as representing our estimates as of any subsequent date. While we may elect to update forward-looking statements from time to time, we specifically disclaim any obligation to do so, even if our estimates change, unless otherwise required by applicable securities laws.