For Release: 02/27/2007

February's Much-Colder-Than-Normal Temperatures Drive Natural Gas Prices Higher

Monroe, MI – Officials of Michigan Gas Utilities, a subsidiary of Integrys Energy Group (NYSE: TEG) announced today that due to colder-than-normal temperatures over the past month, it is necessary to recover its natural gas costs. “We had high hopes to continue with our current gas cost recovery (GCR) factor until April,” said Michigan Gas Utilities President Gary Erickson. MGU had implemented a 26% reduction to its GCR last month, due to unseasonably mild temperatures in November, December and January.

“We built into our decision to lower the GCR last month, forecasting for some cold weather; we just didn’t anticipate a cold snap that severe and for such an extended period. Within our service territory, we had 19-straight days where the temperature did not exceed freezing. That stretch was unexpected. To go along with that, the month of February is ending around 25% colder than normal,” Erickson added.

As a result of the colder weather, Michigan Gas Utilities has requested an increase to its Gas Cost Recovery from $.65000/CCF (one CCF equals 100 cubic feet) to $.76500 per CCF, an increase of 18%, well below its ceiling factor authorized by the Michigan Public Service Commission of $.95900/CCF. The cost increase will be effective for bills issued on and after the first billing cycle in March

For More Information, Contact: