EX 99-1
News Release
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Indiana Office of Vectren Citizens Action
Utility Consumer Corporation Coalition of Indiana
Counselor
100 N. Senate Ave., P.O. Box 209 5420 N. College Ave.
Room 501
Indianapolis, IN Evansville, IN Indianapolis, IN
46204-2215 47702-0209 46220
www.state.in.us/oucc www.vectren.com www.citact.org
For Immediate Contacts: Anthony Mike Roeder Dave Menzer
Release Swinger
March 29, 2001 OUCC Vectren CAC
(317) (317) (317)
233-2747 321-0691 205-3535
Settlement Agreement to Provide Immediate Benefits for Vectren
Natural Gas Customers
The Indiana Office of Utility Consumer Counselor (OUCC), Vectren
Corporation - the parent company of Indiana Gas Company, Inc.
(IGC) and Southern Indiana Gas and Electric Company (SIGECO), and
the Citizens Action Coalition of Indiana (CAC) have reached an
agreement to provide $5.25 million in immediate benefits for IGC
and SIGECO customers.
The agreement, if approved by the Indiana Utility Regulatory
Commission (IURC), will provide an immediate one-month bill
reduction for all IGC customers. In addition, Vectren will make
significant contributions to Indiana's Low Income Heating
Assistance Program (LIHEAP) to help consumers in Vectren's
service territories. Local Community Action Agencies will
distribute the LIHEAP dollars.
All of the contributions under the settlement agreement would be
made in addition to Vectren's existing low-income assistance
commitments, which exceed $940,000 for the two gas utilities. In
addition, the contributions and matching funds would be carried
over to the 2001-2002 heating season if not completely used in
2001.
Pending IURC approval, the settlement agreement's major benefits
break down as follows:
* $3.3 million in rate reductions for all Indiana Gas Co.
customers.
* The one-month credit of $4-$6 would be provided in the
next available month following approval of the agreement.
* A $1 million contribution from Vectren to LIHEAP, to benefit
low-income consumers in IGC territory.
* A $700,000 contribution from Vectren to LIHEAP, to benefit
low-income consumers in SIGECO territory.
* A $250,000 contribution from Vectren to matching funds for
its Share the Warmth Program.
The agreement resolves pending appeals surrounding the IURC's
January 4, 2001 decision that disallowed $3.8 million of IGC's
proposed gas cost increase for January and February. The IURC
order indicated that the disallowance would be implemented
through future proceedings. If the settlement agreement receives
IURC approval, all appeals will be dropped and the rate
reductions will take place immediately. Appeals of the IURC
order would likely delay the reductions. Settlement approval
would also resolve all potential legal concerns involving
SIGECO's current gas cost adjustment proceeding.
The agreement further provides that the $3.8 million
disallowance, which was recognized as a charge to Vectren's 2000
fiscal year results, will be satisfied by the contributions
described above. As a result of the disallowance and other
amounts recognized previously, Vectren expects additional expense
recognized for 2001 will be less than $2 million.
"This agreement brings fair and equitable closure to the pending
legal issues and provides additional support for consumers,
particularly those most affected by the high prices," said
Indiana Utility Consumer Counselor Anne E. Becker. "This
agreement means direct and immediate benefits for Indiana Gas and
SIGECO customers. It also allows the parties to shift focus and
prepare for next winter."
"These are extraordinary times," said Vectren Corporation
Chairman and CEO Niel Ellerbrook. "While we cannot control the
market prices for natural gas, we empathize with the impact
higher prices and cold weather have had on our customers. We are
providing these additional dollars to help many customers pay
their heating bills. This beneficial agreement is the right
outcome for our customers."
Vectren is also providing help to its customers in applying for
assistance from a $25 million grant given by the Lilly Endowment.
The grant is intended to ease the burden of this year's higher
natural gas prices.
"We welcome the additional dollars that will help low-income
Hoosiers who continue to have a tough time dealing with the high
bills," said Citizens Action Coalition Utility Campaign Organizer
Dave Menzer. "This settlement will help people who need it the
most, and we hope the agreement sets the proper tone as we look
toward the next heating season."
The Indiana Office of Utility Consumer Counselor (OUCC) is the
state agency that represents the interests of all utility
consumers and the public in matters related to the provision of
utility services. The agency is active in proceedings before
regulatory and legal bodies, and committed to giving consumers a
voice in the creation of utility service policy.
Vectren Corp. (NYSE: VVC) is an energy and applied technology
holding company headquartered in Evansville. Vectren's energy
delivery subsidiaries provide gas and/or electricity to
approximately one million customers in Indiana and Ohio.
Vectren's non-regulated subsidiaries and affiliates provide
energy-related products and services, fiber-optic based
communications services and utility related services, including
materials management, debt collections, underground pipeline
construction and repairs, underground facilities locating and
meter reading services.
The Citizens Action Coalition is a non-profit advocacy
organization that has represented Indiana citizens for more than
25 years on a broad range of issues, including utility rates and
service, environmental protection and health care. With 300,000
members and supporters statewide, the Coalition has offices in
Indianapolis, Fort Wayne, South Bend and New Albany.