The Empire District Gas Company, a wholly owned subsidiary of The Empire District Electric Company (NYSE:EDE), announced today that it has filed for an increase in its Purchased Gas Adjustment (PGA) with the Missouri Public Service Commission. The Company has requested that the new PGA go into effect on June 6, 2008.
For the north system, which includes the communities of Chillicothe, Brookfield, Brunswick, Bucklin, Chula, Glasgow, Keytesville, Laclede, Marceline, Meadville, Salisbury, Trenton, Utica, and Wheeling, the increase in the PGA is about 37.5 percent when compared to the current PGA that has been in place since November 2007. This increase is a direct result of the higher cost of natural gas used to meet the needs of customers.
The Purchased Gas Adjustment is designed to recover the cost the Company pays to purchase natural gas on the open market, plus the cost of transportation and storage services necessary to move the gas to the Company's service territory where it is delivered to customers. The wholesale cost of gas fluctuates daily therefore the PGA is adjusted periodically to reflect price changes in the market.
For a residential customer in the north system using 600 Ccf (Ccf=100 cubic feet of gas), this PGA adjustment will result in an increase of about $36 per month during the winter heating season of November through March. The PGA accounts for between two-thirds and three-fourths of an average gas bill for a residential customer.
Ron Gatz, vice president and chief operating officer – gas, states, “It is important to note the PGA reflects the costs to Empire of purchasing natural gas for customers. Empire does not earn a profit from the PGA but only recovers the commodity, storage, and transportation costs. Since January 2008 the market price of natural gas has risen nearly 60 percent, forcing Empire to request a change in the PGA.”
Empire warns that future increases in the PGA are likely as long as the open market pricing of natural gas remains volatile and continues to rise. Pricing of natural gas is not regulated and fluctuates with market conditions.
Gatz continued, “The highest natural gas usage occurs during the winter heating season. We strongly urge customers to prepare now for higher bills this winter.”
Empire offers its customers several programs to get a handle on energy bills. Empire’s new Energy Calculator is a free tool that provides customers with a better understanding of how they use natural gas energy in their homes and businesses. Customers are encouraged to take advantage of Empire’s residential financing plan for the installation of high efficiency heating equipment and appliances and to sign up for the Average Payment Plan that smoothes out the highs and lows of utility bills throughout the year. Information regarding these initiatives and tips on saving energy can be found on Empire’s Web site, www.empiredistrict.com.
Based in Joplin, Missouri, The Empire District Electric Company (NYSE: EDE) is an investor-owned, regulated utility providing electricity, natural gas (through its wholly owned subsidiary The Empire District Gas Company), and water service, with approximately 215,000 customers in Missouri, Kansas, Oklahoma, and Arkansas. A subsidiary of the Company also provides fiber optic services.
Certain matters discussed in this press release are “forward-looking statements” intended to qualify for the safe harbor from liability established by the Private Securities Litigation Reform Act of 1995. Such statements address future plans, objectives, expectations, and events or conditions concerning various matters. Actual results in each case could differ materially from those currently anticipated in such statements, by reason of the factors noted in our filings with the SEC, including the most recent Form 10-K and Form 10-Q.
Contacts:
Media Communications:
Emily
Stanley, 417-625-5180
Corporate Communications Coordinator
estanley@empiredistrict.com
or
Investor
Relations:
Jan Watson, 417-625-5108
Secretary –
Treasurer
jwatson@empiredistrict.com
