updated: 10/11/2012 1:14:24 PM

Companies Forecasting Nearly Unchanged Gas Bills

InsideINdianaBusiness.com Report

Three natural gas providers in the state are predicting winter heating bills will remain unchanged or be lower than last year. Evansville-based Vectren Corp. (NYSE: VVC), Indianapolis-based Citizens Energy Group and Merrillville-based NIPSCO all say natural gas markets should be steady and keep customers' prices stable.

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October 10, 2012

News Release

INDIANAPOLIS, Ind. – Natural gas prices that for the past three years have remained stable and relatively low will again translate to manageable bills for Vectren Energy Delivery of Indiana - North (Vectren) customers. Today, the utility announced that assuming normal winter weather year-over-year, customers could see bills that are as much as 5 percent lower. Abundant gas supply in the U.S. has resulted in natural gas costs, which are passed through to customers on a dollar-for-dollar basis, remaining at levels not seen since 2001. As such, bill amounts have decreased by nearly 40 percent since the winter of 2008-2009.

“Given gas costs represent about 60 percent of winter bills, these lower prices are helping keep bill amounts down,” said Brad Ellsworth, president of Vectren Energy Delivery of Indiana - North. “As such, natural gas has continued to be the most cost-effective fuel source for home heating, especially when customers choose high efficiency furnaces. Moreover, the price of gas is expected to remain relatively stable for years to come.”

This year, based upon expected natural gas commodity costs and normal winter weather, customers can expect to pay around $515 over the five-month heating season of November through March based on the average household consumption of approximately 630 therms. Bills will vary by customer depending on the size and age of the home, number of gas appliances, number in the household, thermostat settings and levels of insulation. Keep in mind, last winter was very mild, and the average customer’s actual usage was only 510 therms. As such, bill amounts for November 2011 through March 2012 were much lower than originally forecasted.

“Despite the very positive outlook for natural gas bills, customers should still implement energy efficiency measures and find ways to use less natural gas to lower bills even further,” Ellsworth added. “Investing in high-efficiency appliances, implementing low-cost energy efficiency measures and upgrading insulation are still the right steps to undertake.”

Vectren has in place a number of tools to help customers manage their energy bills.

-Conservation Connection – Offers appliance rebates and new energy-saving tools to help customers lower their natural gas bills. All Indiana residential and small commercial natural gas customers are eligible. A conservation call center 1-866-240-8476 is also available to help customers focus on conservation. Visit Vectren.com for a list of rebates and qualifying appliances.

-Budget Bill: Under this billing plan, a customer's estimated costs for a year of gas service are spread out in equal monthly bill amounts for the year. This leveling of monthly bill amounts reduces the need to pay the full amount in the winter and spreads some of those higher bill charges into the non-heating months. Amounts are adjusted each summer for actual costs, and the customer’s credit or amount due rolls into the next Budget Bill payment for the next 12-month period. Customers can enroll for free at www.vectren.com or by calling 1-800-227-1376.

-Energy efficiency tips: Low-cost home improvement and energy conservation tips are available at Vectren.com or by calling Vectren’s Conservation Connection at 1-866-240-8476. Customers can also access how-to videos on home improvement projects such as caulking, weather-stripping or installing a low-flow showerhead at www.VectrenLiveSmart.com.

-Energy Assistance Program (EAP): State and federal utility assistance dollars are available for income-eligible customers. Those that fall within 150 percent of federal poverty guidelines should visit their local community action agency to sign up for the EAP. To apply for the EAP, customers should call 1-800-872-0371 to locate their nearest community action agency.

-Universal Service Program (USP): All eligible natural gas customers who apply and qualify for EAP will automatically be enrolled in the Universal Service Program (USP), which provides additional gas bill reductions that range from 15 to 32 percent of the total bill (not including EAP benefits) in the months of December through May. The USP, which has been in place since 2005 is the result of a collaborative effort by Vectren, Citizens Energy Group, the Indiana Office of Utility Consumer Counselor, Citizens Action Coalition and a group representing industrial customers. The program provides about $5 million in assistance each year to roughly 25,000 Vectren Indiana customers, including crisis assistance dollars, which target qualified low-income and working-poor households that need additional help to get reconnected and/or maintain heat throughout the upcoming winter.

-Share the Warmth: Those wanting to help the less fortunate with their energy bills can contribute to Share the Warmth, a nonprofit organization that assists income-eligible customers with home weatherization services. Each year, Vectren matches all public donations, up to an annual total of $200,000. Donations may be tax-deductible and can be sent to Share the Warmth, P.O. Box 931, Evansville, IN 47706-0931 or visit www.sharethewarmthinc.com.

“Regardless of lower bill amounts, we know many Hoosiers still find themselves in need of financial assistance, and we encourage them to reach out to us before they get behind on payments” said Ellsworth. “Programs like the Universal Service Program are critical in helping Hoosiers manage costs and stay warm. We encourage customers to contact their local community action agency today and apply for financial and/or home weatherization assistance.”

Natural gas is a commodity bought and sold in a national deregulated market and prices fluctuate daily due to supply and demand pressures. Vectren purchases natural gas on behalf of its customers and then passes those costs on to customers through the gas cost adjustment, which is listed on the Vectren bill as “Gas Cost Charge.” Vectren utilities are not allowed to mark up nor profit from the purchase and sale of natural gas. Only gas costs approved by the Indiana Utility Regulatory Commission are recovered from customers.

Vectren North delivers natural gas to approximately 570,000 natural gas customers in Adams, Allen, Bartholomew, Blackford, Boone, Clark, Clay, Clinton, Decatur, Delaware, Fayette, Floyd, Fountain, Grant, Greene, Hamilton, Hancock, Hendricks, Henry, Huntington, Jackson, Jay, Jefferson, Johnson, Lawrence, Madison, Marion, Martin, Miami, Monroe, Montgomery, Morgan, Orange, Owen, Parke, Putnam, Randolph, Rush, Shelby, Tippecanoe, Tipton, Vermillion, Vigo, Wabash, Warren, Wayne, Wells and White counties.

About Vectren

Vectren Corporation (NYSE: VVC) is an energy holding company headquartered in Evansville, Ind. Vectren's energy delivery subsidiaries provide gas and/or electricity to more than 1 million customers in adjoining service territories that cover nearly two-thirds of Indiana and west central Ohio. Vectren’s nonutility subsidiaries and affiliates currently offer energy-related products and services to customers throughout the U.S. These include infrastructure services, energy services, coal mining and energy marketing. To learn more about Vectren, visit www.vectren.com.

Source: Vectren Corp.

October 10, 2012

News Release

INDIANAPOLIS, Ind. - Citizens Energy Group advised today that the typical gas bill for residential customers in Marion County will decrease about $20 this winter compared to last winter, assuming normal temperatures. The typical residential customer in Marion County will likely use 629 therms of natural gas from November through March, for a total bill of about $555. This compares to about $576 the typical customer would have spent last year.

"Thanks to lower natural gas prices, we are pleased customer bills will be slightly less this winter," said Carey Lykins, President and CEO of Citizens Energy Group. "Even with the decrease in natural gas prices, we know a large number of customers will need help paying their utility bills this year. That's why we are working with community partners to direct customers to available sources of assistance."

Natural gas prices are not set by local utilities like Citizens, but rather by the market forces of supply and demand. Thanks to falling natural gas prices due to increased U.S. production, gas bills in Indianapolis are expected to decline about 24 percent since 2007. Natural gas costs are passed on to customers on a dollar for dollar basis.

Citizens expects to fund more than $1.5 million in energy assistance for low-income customers this winter. The utility is also working with elected officials and regulators to find additional financial assistance for customers, while keeping payment programs and policies as flexible as possible.

Marion County residents in need of energy assistance should call Community Action of Greater Indianapolis at 524-6966. People outside Marion County should call their local Community Action agency. Utility customers can also call Connect to Help at 211 for a variety of household assistance programs. Customers are also urged to contact Citizens, at 924-3311, if they get behind on their gas bills.

Citizens recommends customers enroll in the budget plan to help manage their utility costs. Now that most Marion County customers are enjoying the convenience of a combined gas, water and sewer bill, the budget plan can spread the costs out equally over 12 months. To be eligible for the budget plan, customers need to be current on their bill and have a good payment history. To sign up for budget billing, customers should call 924-3311.

To provide information about energy conservation and safety, Citizens will be hosting its annual Be WinterWise event this Saturday from 9 a.m. to noon outside its Customer Service Center at 2020 N. Meridian. Customers will be able to receive information about how to reduce their utility bills and free smoke and carbon monoxide alarms.

Among the energy savings tips Citizens recommends are:

-Replace your furnace filter - Changing your furnace filter once a month helps your furnace work more efficiently.

-Dial down your thermostat - A 10-degree reduction for an 8-hour period each day will reduce your heating bill 10 percent.

-Dial down the water heater - For each 10-degree reduction in water temperature, you can save up to five percent in energy costs.

About Citizens Energy Group

Citizens Energy Group is a Public Charitable Trust providing safe and reliable utility services to about 1 million customers in and around Marion County. The Public Charitable Trust means the utility is managed only for the benefit of customers and the community. Additional information is available online at www.CitizensEnergyGroup.com.

Source: Citizens Energy Group

October 10, 2012

News Release

MERRILLVILLE, Ind. – Each year, NIPSCO looks at weather predictions, market forecasts, supply trends and storage opportunities to calculate a winter bill projection to help prepare customers for the season ahead. Assuming normal winter temperatures, this year's projections indicate that bills will be among the lowest in a decade and only slightly below (0.56 percent) last winter's bills.

Over the course of the five-month winter heating season – Nov. 1 to March 31 – NIPSCO's average residential customer using a total of 624 therms could expect to pay approximately $438. This compares to $440 for a customer using the same amount of gas during last winter.

For the 11th consecutive month, NIPSCO has the lowest residential gas bills in Indiana, according to bill comparisons released in October by the Indiana Utility Regulatory Commission (IURC).

Note: Actual bills vary by customer depending on the home’s age and size, number in the household, number and age of gas appliances, thermostat settings and insulation levels.

“Market prices for natural gas continue to hold at historically low levels thanks in large part to plentiful domestic resources,” said NIPSCO CEO Jim Stanley. “This is great for our customers, especially as we head into the winter heating season, when utility bills typically reach their highest point of the year.”

While winter bill amounts are projected to be relatively flat compared to last winter, the company expects usage amounts to be slightly higher. Last winter’s usage amounts were lower than normal due to unseasonably warmer temperatures.

The cost of natural gas represents the largest portion of customer bills – on average, two-thirds of an overall bill. NIPSCO has no mark-up and makes no profit on the cost of natural gas billed to its customers. Before billing, natural gas commodity costs must be reviewed by the IURC.

While NIPSCO cannot control market conditions affecting the price of natural gas, the utility does negotiate the best possible price for the natural gas it purchases for its customers.

NIPSCO’s purchasing strategy is a multi-faceted approach that consists of buying gas in the market from a variety of supply sources at different times throughout the year. The ability to utilize gas storage helps to offset market price volatility.

NIPSCO’s gas distribution system consists of three on-system storage facilities and connects to seven interstate pipelines providing access to eight major North American supply basins.

Billing and Payment Options

Customers who are experiencing financial difficulties are encouraged to call NIPSCO’s 24-hour Customer Care Center as soon as possible to determine what options might be available to offer help. Some of those solutions include:

-Payment Assistance Programs: Based on income levels, customers may qualify to receive state and federal utility assistance dollars as well as support funds from separate NIPSCO programs by visiting their local community action agency.

-BudgetPlan: A free service to all NIPSCO customers to help manage their monthly energy bills by spreading out gas costs over an entire year.

-NIPSCO Choice Program: Gives customers an opportunity to choose an alternative natural gas supplier for their home or business. Customers can purchase gas from an alternative supplier, but NIPSCO is responsible for maintaining the pipeline that delivers the natural gas.

-DependaBill and Price Protection Service (PPS): DependaBill provides a fixed monthly bill with no annual reconciliation, while the PPS option allows customers to fix or cap their per-unit cost of natural gas.

For more information on billing options and payment assistance, visit NIPSCO.com/BillingPayment.

Energy and Money Saving Programs

Through NIPSCO’s energy efficiency programs, customers can pinpoint ways to manage their energy usage, and in turn their bills. A full list of programs available to NIPSCO customers to help manage energy use can be found at NIPSCO.com/SaveEnergy.

NIPSCO, with headquarters in Merrillville, Ind., is one of the seven energy distribution companies of NiSource Inc. (NYSE: NI). With more than 786,000 natural gas customers and 457,000 electric customers across the northern third of Indiana, NIPSCO is the largest natural gas distribution company, and the second largest electric distribution company, in the state. NiSource distribution companies serve 3.8 million natural gas and electric customers primarily in seven states. More information about NIPSCO is available at www.nipsco.com.

Source: NIPSCO

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