ENERGY INVESTORS FUNDS CLOSES SIXTH FUND WITH $750 MILLION
Fund Surpasses Target and Reaches Hard Cap in Less Than 12 Months

New York, November 7, 2005 – Energy Investors Funds, an established private equity fund manager that invests in the U.S. energy and electric power sector, today announced the successful closing of the firm’s sixth institutional fund, the United States Power Fund II, L.P. with $750 million in commitments, exceeding the $500 million target established for the fund. 

Investors in US Power Fund II include California Public Employees' Retirement System, Howard Hughes Medical Institute, John Hancock Life Insurance Company, Kauffman Foundation, MIT, Pacific Life, UnionBanCal Equities, Inc., and University of North Carolina, in addition to other corporate and public pension funds, funds of funds, endowments and foundations, insurance companies, banks and financial institutions.  The global investor base represents the U.S., Canada, Europe and Australia, with 31 investors in total and 85 percent returning.

“Investor response to US Power Fund II was extremely positive, resulting in a greater diversity in our Limited Partner base for this fund,” said John Buehler, Energy Investors Funds Managing Partner.  “There is ongoing interest in our investment strategy in the power and energy market, and we’ve been able to attract an array of investors as a result of our 18-year track record as the pioneer private equity investor in this sector.”

US Power Fund II, the firm’s largest fund to date, will acquire U.S. power and energy generation and transmission assets with long-term off-take contracts.  Energy Investors Funds relies mainly on its own sourcing for deals rather than participating in auctions. US Power Fund II seeks to maximize returns to, and achieve liquidity for, its investors through regular cash distributions and proceeds from the sale of assets.  This investment strategy – which has remained consistent throughout the firm’s history – is closely aligned with the national goals set by the recent enactment of the Energy Policies Act of 2005 in an effort to spur private capital investment in the country’s ailing transmission and generation infrastructure.

“The investment philosophy we have adhered to for nearly two decades has an increased relevance today with rising energy costs and electricity demand requiring the construction of more efficient and lower emission power assets,” said Herb Magid, Energy Investors Funds Managing Partner.  “We will continue to invest at the development stage of power assets as well as in facilities that are under construction and in operation to create a portfolio of power assets and companies that are broadly diversified by region and technology.”

“We have one of the strongest proprietary deal pipelines in the industry and we’re pleased to see it continue to grow as a result of the increasing demand for electricity and recent energy policy changes,” said Terry Darby, Energy Investors Funds Managing Partner.  “Utilities and development companies are increasingly seeking outside financial partners like Energy Investors Funds and we expect this trend to continue on an upward trajectory for the long-term.

"US Power Fund II, and its co-investors, are in a position to make equity commitments of $300 million or more to any given enterprise.  This gives us the flexibility to underwrite larger equity investments than we have in the past and we expect to fully capitalize on this new capability,” added Darby.

US Power Fund II has already made three investments including: Glen Park Hydroelectric Project, Neptune Regional Transmission System, and a New York-based transmission project.

Bingham McCutchen served as legal advisor.

About Energy Investors Funds

Energy Investors Funds was founded in 1987 as the first private equity fund manager dedicated exclusively to the independent power and electric utility industry.  Our consistent, proven investment strategy is to create geographically and technologically diversified portfolios of electric power-related assets that provide superior risk-adjusted equity returns with current cash flow and capital appreciation.  As investment managers we seek to mitigate commodity risk (fuel and electricity) by focusing primarily on acquiring power assets with long-term off-take contracts.  Energy Investors Funds has mobilized over $1.75 billion in capital, and currently manages six private equity funds from its offices in Boston, New York, and San Francisco.  These funds have made over 65 diversified investments, with a combined underlying asset value exceeding $5 billion.  For more information visit www.eifgroup.com.