09.29.2006

(Louisville, Ky.) As a result of the dramatic price decreases in wholesale natural gas, Louisville Gas and Electric Company filed a request today with the Kentucky Public Service Commission to pass along natural gas costs that are significantly lower when compared to the same period one year ago.

If the adjustment is approved, a typical residential customer with an average usage of 70 Ccf per month will pay $73 effective Nov. 1, 2006. That compares to $127 per month during November 2005 - a decrease of approximately 42 percent, and $112 per month for the period December 2005 through January 2006 — a decrease of approximately 34 percent. The new adjustment will remain in effect through Jan. 31, 2007. The table below shows the same comparison:

Natural Gas Cost Comparison
Quarter Typical Bill $ Decrease % Decrease Nov 2005 $127     Nov 2006 - Jan 2007 $73 $54 42%   Quarter Typical Bill $ Decrease % Decrease Dec 2005 - Jan 2006 $112     Nov 2006 - Jan 2007 $73 $39 34%

Last Fall, after hurricanes Katrina and Rita struck the Gulf Coast and destroyed U.S. gas supply infrastructure there, natural gas prices spiked to record levels. Since then, a mild winter, the restoration of gas production supplies in the Gulf, and a lack of hurricanes in that region have all resulted in lower natural gas costs going into the Winter.

LG&E uses its storage to stockpile natural gas during the summer months when market prices typically are cheaper. Natural gas from storage helps reduce costs customers pay during the winter months.

Like other gas utilities across the nation, LG&E does not profit from the cost of the gas that it distributes to its customers. LG&E's gas supply costs are passed directly to customers on a dollar-for-dollar basis following review and approval by the Kentucky Public Service Commission. If gas supply costs increase, so do natural gas bills. Likewise, if costs decrease, bills are reduced.

LG&E works to keep its natural gas costs as low as possible and to also deliver reliable supplies to its customers. "Although prices will be lower going into this winter heating season, we continue to encourage our customers to use energy wisely," said Dave Vogel, Vice President of Retail Services at E.ON U.S. "We also will continue to work closely with governmental agencies and energy assistance organizations to help those in need."

The following are some conservation tips to save energy and cut costs this winter:

• Join LG&E's Budget Payment Plan to normalize your costs over a 12-month period.
• Schedule an energy audit. The audit is $15 through LG&E. Call (800) 251-7808 for details.
• Check the amount of insulation in your home.
• Have your ductwork inspected and cleaned by a professional, if necessary.
• Check your thermostat setting. For every degree you turn your thermostat down, you can save 3 to 5 percent on your monthly heating costs.
Turn your thermostat down to 65 degrees at night or if you're going to be away from your home for more than four hours.
• Change disposable furnace filters every 30 days or so. The company is providing calendar stickers in its October newsletter as a way to help customers remember to change their furnace filters. Another good reminder is to change or clean your furnace filter on the day you receive your LG&E bill.
• Use draft stoppers at doors and windows.
• Wear layered or warmer clothing while indoors and put extra blankets on your bed.
• Close the dampers and doors in fireplaces when not in use, unless you have a gas fireplace.
• On sunny days, open drapes and blinds to allow the sunlight to brighten and warm rooms; close drapes and blinds at night to retain the heat.

For more information on energy-saving programs, heating tips, or available financial assistance, visit www.eon-us.com.

LG&E is a wholly-owned subsidiary of E.ON U.S. LLC that serves 321,000 natural gas and 394,000 electric customers in Louisville, Ky., and 16 surrounding counties.