Terasen Gas Inc. applies for new two-year delivery rate proposal

    Application addresses the evolving needs of customers and the communities
    in which the company operates

    SURREY, BC, June 15 /CNW/ Terasen Gas Inc. has filed a two-year revenue
requirement application with the British Columbia Utilities Commission (BCUC)
that, if approved, will ensure enhanced services and programs are put into
place to help meet the growing and changing energy needs of British
Columbians, and further support provincial energy policies.
    "We have carefully considered the steps required for maintaining safe,
reliable and cost-effective natural gas delivery. The requested changes are
grounded in our continued commitment to meeting the needs of the customers and
communities we serve, while also addressing new requirements from our various
regulators and policy makers," said Randy Jespersen, President and CEO,
Terasen Gas.
    "The costs identified in the application also support our efforts to
develop affordable energy solutions that help customers reduce their energy
consumption, and advance the province's goals of reducing greenhouse gas
emissions," said Jespersen.
    If the application is approved, Terasen Gas will expand energy efficiency
and conservation initiatives, including programs for low-income, rental and
industrial customers. To meet the needs of our customers, the company will
also continue to pursue alternative energy solutions, such as biogas,
geothermal and district heating systems, as well as advance compressed and
liquefied natural gas as cleaner transportation fuel alternatives.
    The existing performance-based rate agreement, which expires on December
31, 2009, has been extended once, reflecting the value it has generated for
both customers and the company. An estimated $69 million of cost-shared
savings has accrued to customers, helping to keep delivery rates relatively
stable for six years.
    The cost of natural gas service varies from region to region, and if the
application is approved, residential customers in the Lower Mainland would see
their total annual gas bill increase by approximately three per cent, or $31
per year, depending on consumption, effective January 1, 2010.
    "The external environment has changed significantly since the last
multi-year agreement was put in place six years ago, and to remain a trusted
operator, Terasen Gas must take action to keep pace with the ever-evolving
business environment in which we operate," said Jespersen.
    "The forecasted increase in rates primarily relates to changes in
accounting standards that Canadian utilities are required to comply with, as
well as the important role Terasen Gas must play in pursuit of the goals and
objectives of B.C.'s most recent energy and environmental policies. We look
forward to building on our successes with enhanced offerings and initiatives
outlined in this application," said Jespersen.
    In June, Terasen Gas (Vancouver Island) Inc. will file a revenue
requirement application, in addition to a rate design application, with the
    To learn more about Terasen Gas rates, visit terasengas.com

    Terasen Gas is mainly composed of the operations of Terasen Gas Inc. and
Terasen Gas (Vancouver Island) Inc., both indirect wholly owned subsidiaries
of Fortis Inc. Fortis Inc., the largest investor-owned distribution utility in
Canada, serves more than two million gas and electric customers and has total
assets approaching $12 billion. Its regulated holdings include Terasen Gas and
electric utilities in five Canadian provinces and three Caribbean countries.
Fortis Inc. owns non-regulated hydroelectric generation assets across Canada
and in Belize and upper New York State. It also owns hotels and commercial
real estate in Canada. Fortis Inc. shares are listed on the Toronto Stock
Exchange and trade under the symbol FTS. Additional information can be
accessed at www.fortisinc.com or www.sedar.com

For further information:

For further information: Media contact: Joyce Wagenaar, Director,
Corporate & Marketing Communications, Terasen Gas Inc., (604) 785-8946, Email:

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