by Nora Edinger

REGIONAL EDITOR

FAIRMONT -- Allegheny Power is gearing up for a bigger presence in West Virginia -- and elsewhere, according to company officials.

In an end-of-the-year media update Wednesday at the Whitehall training center, an executive from company headquarters in Hagerstown, Md. said Allegheny has made several key purchases in 2000 that reflect its growth plan.

"Allegheny had no natural gas customers until we purchased Mountaineer Gas last year," said Cynthia Shoop, vice president of corporate communications, of a diversification direction the company is taking.

Allegheny acquired another state gas retailer, West Virginia Power, and its customers in August, making the Mountain State its main consumer at nearly 700,000 customers for electric and gas combined.

The company will be pursuing more gas customers, as well as electric, as utility deregulation kicks in, she added. West Virginia is among several Eastern states pursuing electric deregulation, which would ultimately lead to corporations vying for customers' business in a manner similar to how phone service is handled.

"The advent of competition is what's really been driving the strategy," Shoop said. "When there are customers choosing, you want to be able to have a lot of options for them so they will choose you."

In building that portfolio of customer options, Shoop said the company is also venturing into telecommunications, stringing fiber-optic cable alongside its power lines. It will sell capacity to Internet service providers, not directly to customers.

Allegheny is also interested in building some "peaking plants," possibly in West Virginia at some point. These plants generate electricity during times of peak need and sell directly to other power companies through a national power grid.

West Virginia may be a key player in Allegheny's overall growth strategy because of its abundance of coal, she said, adding that more than 80 percent of the company energy production is from coal, and will likely remain near that level.

Allegheny already has 550 employees in Marion County alone, with its corporate-wide customer call center and employee training center and a power plant there.

Allegheny is also looking at the national market to further diversify, she said. In 2000, the company purchased three power plants in the Midwest and is building a plant in Arizona in order to tap into new regional markets and increase its energy output.

Shoop sees more acquisitions and growth within the company continuing in the next few months and years.

"The larger players will definitely have a national growth story," she said of the post-deregulation market.

Regional editor Nora Edinger can be reached at 626-1403 or by e-mail at nedinger@exponent-telegram.com.