Customers to experience some of the lowest natural gas commodity rates in
over five years

BCUC approves Terasen Gas' request to adjust natural gas and propane rates

SURREY, B.C., Dec. 13 /CNW/ - Terasen Gas has received approval from the British Columbia Utilities Commission (BCUC) to adjust some of the rates it charges customers on the mainland for natural gas and propane service. As a result, overall annual bills for residential natural gas customers on the mainland will decrease by approximately $39 to $79 depending on their rate area (discussed further below), while overall annual bills for residential propane customers will increase by approximately $33, both depending on consumption, effective January 1, 2011.

"Most of our customers will see a decrease in natural gas rates as a result of this decision," said Cynthia Des Brisay, Vice President, Energy Supply and Gas Transmission, FortisBC and Terasen Gas. "As always, we remain committed to helping customers conserve energy and save even further on their gas bill. So, while most natural gas customers on the mainland will see a decrease in their overall annual bills due to the lowest commodity rates seen in over five years, energy efficiency is still a priority and we encourage everyone to be conscientious about their energy use."

Natural gas prices have continued to decrease in the last quarter due to strong natural gas production and storage levels, and lower than expected demand in key consuming areas of the United States. However, propane prices, which are closely linked to global oil markets, have continued to increase in the last quarter. Factors affecting the market price of natural gas include weather, supply and demand, and economic conditions.

Rates will change as follows on January 1, 2011:

Lower Mainland, Fraser Valley, Interior, North, and the Kootenays

• Residential customers will see a decrease of approximately $55 to $69 on their overall annual bills, depending on consumption. This change is due to several factors: decreases to the natural gas commodity and midstream rates, as well as a previously approved increase to the delivery rate (as part of the service region's 2010/2011 revenue requirement application).
  
  Customer Choice program participants will also see the same changes in their delivery and midstream rates. However, their commodity rates will not be affected, as they purchase the gas commodity from a licensed gas marketer.

Whistler

• Residential customers will see a decrease of approximately $79 on their overall annual bills, depending on consumption. This change is due to several factors: a decrease to the commodity portion of interim natural gas rates, as well as a previously approved decrease to the delivery portion of interim natural gas rates (as part of the service region's 2010/2011 revenue requirement application).

Fort Nelson

• Residential customers in Fort Nelson will see a decrease of approximately $39 on their overall annual bills, depending on consumption. This change is due to several factors: a decrease to the commodity portion of interim natural gas rates, as well as a previously approved increase to the delivery portion of interim natural gas rates (as part of the service region's 2011 revenue requirement application).

Revelstoke

• Residential customers will see an increase of approximately $33 on their overall annual propane bills, depending on consumption. This change is due to several factors: an increase to the commodity portion of propane rates, as well as a previously approved increase to the delivery portion of propane rates (as part of the 2010/2011 revenue requirement application).

Vancouver Island, Sunshine Coast and Powell River

• Rates for Vancouver Island, Sunshine Coast and Powell River customers will remain unchanged as these regions are covered by a separate regulatory structure. For a two-year period, which started on January 1, 2010, residential and commercial commodity rates in this service area will remain unchanged.

Terasen Gas purchases natural gas and propane on behalf of its customers and passes that cost on to customers without mark-up. Midstream rates, also passed on to customers without mark-up, cover the storage and transportation of the gas delivered to customers. Commodity and midstream rates make up about 60 per cent of a typical residential customer's annual bill in the Lower Mainland. Terasen Gas earnings come from delivery charges - what the company charges to deliver natural gas and propane to customers.

Terasen Gas is committed to helping customers conserve energy and save on their gas bill. Through its three-year, $80 million Energy Efficiency and Conservation program, Terasen Gas will be helping customers eliminate more than 775,000 tonnes of greenhouse gas emissions, saving a total of 15.5 million gigajoules - enough natural gas for about 155,000 homes annually.

For more information on natural gas and propane rates by region, energy efficiency incentives, and to learn more about Terasen Gas, visit terasengas.com.

Terasen Gas is composed of the operations of Terasen Gas Inc., Terasen Gas (Vancouver Island) Inc., and Terasen Gas (Whistler) Inc. Terasen Gas is a leading integrated energy solutions provider, focused on the safe and reliable provision of natural gas, propane and alternative energy solutions. Terasen Gas serves approximately 939,000 residential and commercial customers in more than 125 B.C. communities. Terasen Gas employs more than 1,280 people in British Columbia and is indirectly wholly owned by Fortis Inc., the largest investor-owned distribution utility 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.

BACKGROUNDER - Approved Changes for Typical Residential Customers

A gigajoule is a measure of energy. One gigajoule is equivalent to 278 kilowatt hours of electricity. One gigajoule of gas can heat a typical 2,000 square foot home for one day during the winter.

	Lower Mainland & Fraser Valley Based on 95 GJ/year		Interior & North Based on 75 GJ/year		Kootenays Based on 80 GJ/year
	Jan 1, 2010	Jan 1, 2011	Jan 1, 2010	Jan 1, 2011	Jan 1, 2010	Jan 1, 2011
Basic monthly charge	$11.84	$11.84	$11.84	$11.84	$11.84	$11.84
Delivery charge/GJ	$3.145	$3.207	$3.145	$3.207	$3.145	$3.207
Midstream charge/GJ	$1.725	$1.349	$1.704	$1.324	$1.764	$1.364
Charges for gas used/GJ (commodity rate)	$4.953	$4.568	$4.953	$4.568	$4.953	$4.568
Estimated total annual bill	$1,075	$1,009	$877	$825	$931	$873

	Fort Nelson Based on 140 GJ/year
	Jan 1, 2010	Jan 1, 2011
Minimum monthly charge (includes the first 2 GJs)	$21.22	$19.66
Charge on the next 28 GJ/month	$8.346	$7.458
Charge on excess of 30 GJ/month	$8.288	$7.388
Estimated total annual bill	$1,223	$1,101

	Whistler Based on 90 GJ/year
	Jan 1, 2010	Jan 1, 2011
Basic monthly charge	$7.50	$7.50
Charge for gas used per GJ	$16.855	$15.315
Estimated total annual bill	$1,607	$1,468

	Revelstoke Based on 50 GJ/year
	Jan 1, 2010	Jan 1, 2011
Basic monthly charge	$11.84	$11.84
Delivery charge/GJ	$3.145	$3.207
Cost of propane per GJ	$14.628	$15.214
Estimated total annual bill	$1,031	$1,063

For further information:

Media Contact:
Marcus Wong
Corporate Communications Manager
Terasen Gas
Phone: [phone]
Email: [email protected]
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