News Release

HU Reduces Natural Gas Rates

April 29, 2009

Huntsville Utilities announced today a rate decrease for all natural gas customers. The rates for Huntsville Utilities’ residential customers are being lowered by 10% from $13.82 to $12.44 per one thousand cubic feet (1,000 mcf). The new rate will be effective on May bills.

With the new rate, the average gas customer could see their monthly bill reduced by nearly $12 a month during the peak heating months of December through February. The average Utilities’ gas customer uses 10,000 cubic feet of gas during the heating season. Under the current rates they would have a bill of $140.70, which includes a $2.50 monthly customer charge. Under the new rate, the same usage would result in a bill of $128.90. The average usage of 10,000 cubic feet per month is based on a 1,800 square foot house using natural gas for heating and water heating.

Rates for other rate classifications including commercial and industrial customers will also see rate reductions of from 10 to 12 percent. Transportation only customers will not see a reduction.

Natural gas is a commodity traded on the Futures Market of the New York Mercantile Exchange (“NYMEX”). Pricing on NYMEX directly influences the price paid for natural gas by Huntsville Utilities. The cost customers pay for natural gas reflects what Huntsville Utilities pays for gas supplies it obtains from the gas production areas along the Gulf Coast. Huntsville Utilities does not earn a profit on the cost of the gas purchased to meet system requirements.

The Huntsville Utilities gas system is the largest publicly owned gas system in Alabama serving over 47,000 customers in Huntsville and Madison County.