PUC Approves UGI PNG Base Rate Increase – August 2009

Reading, PA – UGI Penn Natural Gas (UGI PNG) announced today that the Pennsylvania Public Utility Commission has approved a settlement of UGI PNG’s base rate case. The settlement results in a UGI PNG increase of $19.75 million, compared to an original request of $38.1 million, filed on January 28, 2009.

The higher base rates for customers will become effective on August 28, 2009. The typical residential heating customer who consumes about 107 Mcf (thousand cubic feet of gas) of natural gas per year will see their overall bill increase by $10.33 per month, from $131.39 to $141.72 per month, or by 7.9%. Bills for commercial and industrial retail customers will increase by approximately 2.8% as a result of the higher base rates, with the level of increase varying according to the type of service provided. This comparison reflects UGI PNG’s current Purchased Gas Cost (PGC) rates.

In fact, UGI PNG expects that the base rate increase will be more than offset by a projected 10% drop in PGC rates to begin on December 1. While actual market conditions for natural gas may result in a larger or smaller decrease, UGI PNG customers are expected to pay lower prices for retail natural gas service this coming winter than they paid last year.

Base rates cover the cost of operating and maintaining UGI PNG’s natural gas distribution system. These rates also cover the costs associated with customer services such as billing, meter reading and 24-hour emergency response.

According to Peter G. Terranova, UGI PNG’s vice president of marketing, rates and supply, “We believe that the settlement represents a fair outcome for both the Company and our customers. We are sensitive to the impact that any rate increase will have on customers during these difficult economic times. Throughout the settlement process we worked to balance the rate impact on our customers with the need to maintain safe and reliable gas service.”

Natural gas continues to be an excellent value. UGI PNG recommends that customers use energy wisely and improve the efficiency of their homes. UGI PNG offers a free budget billing plan which helps spread bill payments more evenly throughout the year. In addition, customers with a limited or fixed income are encouraged to call UGI PNG to determine if they are eligible for one of several energy assistance programs. Finally, any customer who is behind on their gas bills should contact UGI PNG as soon as possible to discuss a payment arrangement.

UGI Penn Natural Gas is a wholly owned subsidiary of UGI Utilities, Inc. UGI Penn Natural Gas serves approximately 158,000 customers in 13 counties throughout northeastern and central Pennsylvania, including customers in and around Scranton, Wilkes-Barre and Williamsport. Additional information about UGI’s Penn Natural Gas is available at www.ugi.com.