Chattanooga Gas Company Files Joint Rate Settlement Proposal
PRNewswire-FirstCall
CHATTANOOGA, Tenn.

Chattanooga Gas Company along with the Consumer Advocate and Protection Division of the Tennessee Attorney General's office and the Chattanooga Manufacturers Association today filed a joint settlement proposal with the Tennessee Regulatory Authority (TRA). The proposal addresses Phase I of the rate case the company filed with the TRA earlier this year.

If the settlement is accepted by the TRA, the revised base rates will go into effect on Jan. 1, 2007. The average residential customer using 60 therms of natural gas each month will have a bill increase of $1.92 or 2.5 percent in the non-gas portion of the bill.

Officials with the company attribute the need for this rate increase to the higher cost of financing its operations and lower consumption of natural gas.

"Even with this base rate increase, our customers are expected to pay 5.2 percent below the national average," said Steve Lindsey, vice president and general manager, Chattanooga Gas Company. "The recent 34 percent natural gas price reduction more than offsets this slight increase. Natural gas remains a great value for our customers."

Next year, the TRA will consider Phase II of the rate case, under which customers can benefit from a 21-point home energy check-up and a weatherization kit to help them make their homes more energy efficient. With these benefits, customers can save up to $170 annually in energy costs. The program also includes rebates for more energy efficient appliances. Customers can save an additional $200 each year. These energy savings could more than offset the proposed residential rate increase.

In October, Chattanooga Gas Company announced its customers will see a 34 percent reduction in the natural gas portion of their bills compared to one year ago due to a natural gas price reduction. The average residential customer who uses 60 therms of natural gas should save approximately $29.50 in November. In December, the average residential customer who uses around 115 therms of natural gas should save $56.60 versus one year ago.

Chattanooga Gas makes no profit on the natural gas it purchases on behalf of customers. It must purchase the natural gas at the current market price and pass the cost of the gas along to its customers without a profit.

In addition, Chattanooga Gas Company is also refunding customers $4.7 million during 2006 as part of their asset management agreement with Sequent Energy Management.

About Chattanooga Gas

Chattanooga Gas, a wholly owned subsidiary of AGL Resources , provides retail natural gas sales and transportation services to approximately 61,000 customers in Hamilton and Bradley counties in southeast Tennessee. The Chattanooga Gas service area includes the communities of Chattanooga, Cleveland, Red Bank, East Ridge, Lookout Mountain and Signal Mountain. The Chattanooga Gas natural gas pipeline system delivers approximately 20 billion cubic feet of gas per year. For more information, please see www.chattanoogagas.com.

About AGL Resources

AGL Resources , an Atlanta-based energy services holding company, serves 2.2 million customers in six states through its utility subsidiaries - Atlanta Gas Light, Elizabethtown Gas in New Jersey, Virginia Natural Gas, Florida City Gas, Chattanooga Gas, and Elkton Gas in Maryland. AGL Resources reported revenue of $2.7 billion and net income of $193 million in 2005. The company also owns Houston-based Sequent Energy Management, an asset manager serving natural gas wholesale customers throughout the East and Midwest. As a 70 percent owner in the SouthStar partnership, AGL Resources markets natural gas to consumers in Georgia under the Georgia Natural Gas brand. AGL Networks, the company's telecommunications subsidiary, owns and operates fiber optic networks in Atlanta and Phoenix. The company also owns and operates Pivotal Jefferson Island Storage & Hub, a high-deliverability natural gas storage facility near the Henry Hub in Louisiana. For more information, visit www.aglresources.com.

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SOURCE: AGL Resources Inc.

CONTACT: Robin Keegan of AGL Resources Inc., +1-404-584-3946, or cell,
+1-404-783-1758, or rkeegan@aglresources.com