Regulatory Research Associates Reports Rise In Average Authorized Equity Returns For The First Half of 2008

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SNL Energy affiliate expects volume of rate case decisions to subside after spiking in recent years.

Major Rate Case Decisions - Second Quarter 2008

According to a recent report from Regulatory Research Associates (RRA), an SNL Energy affiliate, average equity returns authorized by state commissions increased in the first six months of 2008.

The report, "Major Rate Case Decisions - Second Quarter 2008," indicates the average ROE for electric utilities was 10.53% (18 cases) for the first two quarters of 2008 versus 10.36% for 2007. The average ROE for gas utilities was 10.35% (nine cases), compared with the 2007 average of 10.24%.

After reaching a nadir earlier this decade, the number of rate case decisions for energy companies has generally increased over the last several years. The total number of electric and gas rate decisions in 2007 (94) was more than double the number in 2003 (42).

"Increased costs for environmental compliance, and the need for generation and delivery infrastructure upgrades and expansion at many companies seem to indicate increased level of rate case activity over the next several years," said Rob Schain, president of RRA. "However, relatively low interest rates, cost efficiencies from technological advancements, the use of multi-year settlements that do not specify return parameters and a reduced number of companies due to mergers may prevent the number of rate cases and equity return determinations from growing significantly in the near future."

Reports such as "Major Rate Case Decisions - Second Quarter 2008" are available exclusively to RRA clients as part of the SNL Energy Information Service. For more information on this report and other energy data from SNL, call 866.296.3743 or email EnergySales@snl.com.

Visit the SNL Press Room at http://www.snl.com/press_room to learn more about resources available to members of the media.

About SNL Energy

SNL Energy, a division of SNL Financial, provides comprehensive intelligence for the power, natural gas and coal markets through an online service that integrates news, data, analytics and research. Other business sectors covered by parent company SNL Financial include Banking, Financial Services, Insurance, Real Estate and Media & Communications. For more information, visit http://www.SNL.com.

About Regulatory Research Associates (RRA)

RRA provides independent research and consultation on electric utility securities and regulation, with a reputation for unmatched expertise in both areas. Acquired by SNL Energy in 2005, RRA remains the industry leader on regulatory issues affecting utilities.

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Monica Jenkins
Marketing Manager
434.951.6951
mjenkins @ snl.com

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