News Release
Oct. 21, 2002

UNION GAS RATE ADJUSTMENT PAYMENTS DELAYED UNTIL JANUARY 2003

CHATHAM, ONTARIO -- Union Gas today announced that the first installment of a rate adjustment payment, recently approved by the Ontario Energy Board (OEB), would be billed in January 2003, rather than in December 2002, as originally approved.

 

Union Gas President, Jane Peverett, said that postponing the start of the payment period until January is intended to reduce the financial strain on customers over the holiday season. Earlier this month, in response to customer concerns, the company extended the payment period to six months from three. This reduced the monthly installment to about $20 from the original $40, for an average residential customer.

 

“We understand the concerns expressed by our customers,” said Peverett. “The changes announced today will reduce the impact on monthly bills and put more of the cost into warmer months when gas use is lower.”

 

The OEB approved Union Gas’s request to recover additional costs for gas delivered during the cold winter of 2000-2001 when gas prices were at their record high. Over a period of about three months, Union Gas was required to purchase additional natural gas in order to prevent any interruptions in service. Customers received natural gas service at this time for a price that was lower than cost.

 

The Union Gas application to recover these additional costs was made more than a year ago. The OEB found these costs to be justified after a public hearing that included representation by more than 50 intervenor groups.

              

This method of adjusting for the actual cost of gas used in operating the Union Gas system has been used for years and has resulted in refunds for customers in other years when actual gas costs were lower than those in rates. “However, we do understand why our customers are now concerned with this means of recovering prior period costs.”

 

Union Gas welcomes the recent announcement by the Ontario government to review the operations of the OEB.

 

“Union Gas will work with government and the OEB to improve the regulatory process while maintaining fairness and accountability to energy consumers,” Peverett said. “During this review, Union Gas will bring forward recommendations aimed at eliminating the concern over rate adjustments from a prior period.”

 

Union Gas is an integrated natural gas storage, transmission and distribution company serving 1.1 million residential, commercial and industrial customers in more than 400 communities in northern, southwestern and eastern Ontario.  The Company also provides storage and transportation services to other utilities and energy market participants in Ontario, Quebec and the United States.  Union Gas is a Duke Energy company.

 

Duke Energy is a diversified multinational energy company with an integrated network of energy assets and expertise.  The company manages a dynamic portfolio of natural gas and electric supply, delivery and trading businesses – meeting the energy needs of customers throughout North America and in key markets around the world.  Duke Energy, headquartered in Charlotte, N.C., is a Fortune 100 company traded on the New York Stock Exchange under the symbol DUK.  More information about the company is available on the Internet at: www.duke-energy.com. 

 

Contact: Elizabeth Havelock
Phone: 519/436-4520
24 Hour Phone: 704/382-8333
Email: ehavelock@duke-energy.com