News Release

Huntsville Utilities Announces That Natural Gas Rates Will Increase By 14.05%

October 28, 2005

Huntsville Utilities' Natural Gas Board has approved a rate increase for natural gas for the month of November. The rates for Huntsville Utilities' customers will be increased by two dollars and three cents ($2.03) for a thousand cubic feet of gas. The new rate will take effect with meter readings starting Monday, October 31, 2005.

The new residential rate for natural gas will be $16.48 per one thousand cubic feet (Mcf). Industrial, commercial, educational and government customers rates will also increase by $2.03/Mcf for the month of November.

In September Huntsville Utilities announced that utility officials would be reviewing the market gas price on a monthly basis in order to adjust rates as needed. This ability allows the utility company to bring it's natural gas customer's rates as close as possible to the market rate.

Natural gas prices have been paralleling the petroleum market since Hurricanes Katrina and Rita have disrupted the pipeline delivery system and production facilities.

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 gas system is the largest public gas system in Alabama serving over 44,000 customers in Huntsville and Madison County.