Central Hudson Seeks Permission to Raise Delivery Rates, Offer Energy Efficiency...

Central Hudson Seeks Permission to Raise Delivery Rates, Offer Energy Efficiency Programs

-- Changes, if Approved, Would Take Effect Next Summer --
ALBANY, N.Y.--(Business Wire)--
CH Energy Group, Inc. (NYSE:CHG) subsidiary Central Hudson Gas &
Electric Corporation filed a petition with the New York State Public
Service Commission today to increase delivery rates for electricity
and natural gas, offer energy efficiency programs to help customers in
its eight-county Mid-Hudson Valley service territory better manage
their energy use, and implement a revenue decoupling mechanism.

The delivery rate increases, if approved as proposed, would raise
typical residential electric bills by about 3.5 percent based on
current market supply costs for electricity, or an increase in the
delivery portion of their bill of approximately $3.50 per month; an
average residential natural gas heating customer would see about an 8
percent increase in total bills based on current market supply costs
for natural gas, or an increase in the delivery portion of their bill
of about $14.70 per month when averaged over 12 months. These changes
are proposed to take place next summer, after an 11-month regulatory
process that will include public hearings and other opportunities for
interested parties to submit comments regarding the proposal.

"We have had tough choices to make about how to adequately fulfill
our obligations to our customers and investors during these times of
rising prices. Considering the shortfalls in previously authorized
revenues, we've reached a point where we must raise our rates in order
to recover the costs of providing the level and quality of service
that our customers expect and require," said Michael L. Mosher, Vice
President of Regulatory Affairs.

"This request comes from a need to safely and reliably operate our
critical energy systems. As neighbors, we know times are tough for
everyone, and we're minimizing our request as much as possible.
Central Hudson is controlling costs by continuously improving
productivity and working more efficiently - we are a lean company and
extremely cost conscious, and we took this step only because it was
necessary," said Mosher.

"We are seeking an increase in our delivery rates for many
reasons, including increased expenses for items such as trimming
trees, providing fleet fuel and paying taxes, as well as continuing
investments in the electric and natural gas delivery systems to
improve the reliability of our service and to meet the energy needs of
the Hudson Valley. And, as every home owner can appreciate, the costs
for many of the goods and services used to maintain our operations
have increased substantially," said Mosher.

"We are also proposing energy efficiency programs, as our
customers have told us that they look to Central Hudson for help in
managing their energy use, particularly during these times of higher
energy costs," said Mosher. In addition, the filing includes a revenue
decoupling mechanism, which the Public Service Commission directed
utilities to propose and which would break the link between sales and
revenues, encouraging Central Hudson to fully support customers' steps
to become more energy efficient.

"We understand how rising energy costs can affect our customers,
and seized every available opportunity to reduce costs," said Mosher.
"For example, we worked closely with our employees to reduce the costs
of pension and other post employment benefit plans, with an expected
savings of nearly $75 million over the next five years. Also,
productivity at Central Hudson continues to improve, as we are serving
6 percent more customers today with fewer employees than we did in
2002."

The filing made in Albany today applies only to delivery rates;
the cost of energy supply is based upon the competitive marketplace as
a result of New York State's deregulation of the electric and natural
gas industries. Mosher said that Central Hudson's rates, even with the
proposed changes, are projected to remain among the lowest in New York
state for electricity and near the statewide average for natural gas.

The filing and additional information regarding this proposal can
be found at the utility's Web site at
www.CentralHudson.com/EnergyAnswers.

CH Energy Group, Inc.
John Maserjian, 845-471-8323

Copyright Business Wire 2008