For Immediate Release - July 16, 2009

Attorney General Martha Coakley Requests Over $860,000 Customer Refund for Unauthorized Unitil Gas Purchasing Plan

BOSTON- Attorney General Martha Coakley's Office asked state regulators to refund over $860,000 to customers for Unitil's Gas Division's use of a costly gas procurement program that was not authorized by the Department of Public Utilities (DPU). The request was made in connection with an investigation opened by the DPU into Unitil's gas procurement practices for the period November 1, 2007 through April 30, 2009. The Attorney General's Office alleges that Unitil's customers paid gas supply costs that were higher than the ratepayers of other gas companies. The Attorney General's Office filed this brief last week with the DPU.

"While Unitil's customers were no doubt keeping a close eye on their heating bills during this period, our office alleges that the company was engaging in an unauthorized gas purchasing program that saddled ratepayers will excessive costs," said Attorney General Martha Coakley.

In its brief, the Attorney General's Office requests that the Department order Unitil to refund $863,368.00 back to its customers in the form of a bill credit to partially reimburse them for the excessive gas supply costs incurred pursuant to its gas purchasing plan. Under the proposed refund, a typical customer using 150 therms per month would receive a $9.60 credit.

Unitil provides gas service to approximately 15,100 customers in the communities of Fitchburg, Townsend, Lunenburg, Ashby, Westminster and Gardner. This filing is unrelated to the current proceedings before the DPU relative to Unitil's response to the December 2008 ice storm.

The Attorney General serves as the utility ratepayer advocate and is authorized to intervene in administrative and/or judicial proceedings on behalf of consumers in connection with any matter involving the rates, charges, prices or tariffs of any gas company doing business in the Commonwealth. Massachusetts gas companies typically purchase a portion of the gas needed to meet winter customer demand during a six-month period before the peak heating season. The cost the company pays for the gas it eventually delivers is passed directly through to customers. To reduce the volatility of these prices, the DPU allows gas companies to use procurement plans, which must be reviewed and approved by the DPU.

This matter is being handled by Assistant Attorney General R.J. Ritchie, of the Attorney General's Office of Ratepayer Advocacy.

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