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Yankee Gas Press Release
From The Northeast Utilities System
MEDIA CONTACT:
Jeff Tilghman
Dave Radanovich
Office:
(860) 665-3931
(860) 665-3384
After Hours:
(800) 286-2000
(800) 286-2000
RATE ADJUSTMENT TO BE FILED WITH DPUC
Customers to Benefit from LNG Facility and Customer Service Integration
BERLIN, Conn., November 29, 2006 —
Yankee Gas Services Company (Yankee Gas), Connecticut’s largest natural gas distribution company, has filed a Letter of Intent with the Connecticut Department of Public Utility Control (DPUC). The Letter of Intent states that the company will file a rate application at the end of December for new rates effective July 1, 2007. The rate adjustment is driven by several factors including the completion of Yankee Gas’ liquefied natural gas (LNG) facility in Waterbury, Connecticut, and the multi-year integration and improvement of its customer service operations.
“These two significant investments will provide benefits to our customers for decades to come. In addition, the requested increase enhances our ability to deliver the high level of service our customers demand from us,” said Raymond P. Necci, president and chief operating officer, Yankee Gas.
Completion of the state-of-the-art LNG facility will enable the company to buy natural gas in periods of low demand and typically lower cost, store it as a liquid, and use it during peak demand periods when prices are typically much higher, thus saving customers money. Begun in 2004, the $108 million facility will be placed into service in time for the 2007-2008 heating season.
Customers also will benefit from the company’s newly integrated customer service system and facility. Located in Windsor, Connecticut, the facility gives customers access to a tenfold increase in call center personnel sharing state-of-the-art technology, expanded hours of operation, and improved self-service offerings via the telephone or Internet.
“The decision to seek a rate adjustment is never an easy one and there is never a good time to make such a request. However, the 2007 completion of the LNG facility requires us to file to recover the significant investment associated with constructing it. In addition, the existing rate plan approved two years ago does not provide us with revenues sufficient to cover our other current operating costs,” said Necci.
In an effort to mitigate the request, Yankee Gas has already undertaken several initiatives to manage costs. The company has begun to restructure its commodity and pipeline contracts resulting in considerable savings for customers. Other actions include the consolidation of functions and facilities. Despite these efforts, Yankee Gas still faces considerable cost pressures in its day-to-day operations, making it increasingly difficult to provide reliable service to its customers.
The request for a net increase of approximately $37.4 million, which consists of a distribution rate increase of $67.9 million (applicable to all firm customers) offset by decreases in commodity and pipeline charges of approximately $30 million (applicable primarily to firm sales customers), will be filed by the end of December. For firm sales customers this equates to about an 8.5 percent average increase. If granted, new rates are expected to take effect around July 1, 2007.
Yankee Gas Services Company (Yankee Gas) is Connecticut’s largest natural gas distribution company, delivering safe, reliable natural gas service to nearly 200,000 customers in 71 cities and towns. Yankee Gas is expanding Connecticut's energy options and increasing customer choice by extending the availability of clean, efficient natural gas throughout the state. Yankee Gas is part of the Northeast Utilities System (NYSE: NU). For more information, please visit www.yankeegas.com.
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