(Philadelphia, Pa. – July 13, 2006) – The Philadelphia Gas Works (PGW) today warned that proposed changes in the Low Income Home Energy Assistance (LIHEAP) will harm Pennsylvania’s neediest citizens and increase costs for paying utility customers, including the working poor and small businesses.

The combined changes, including one new requirement that is inconsistent with Pennsylvania Public Utility Commission regulations, “will contribute to explicit and immediate increases for the responsible paying customer of PGW – of all income levels,” said Steven P. Hershey, PGW Vice President, Regulatory and External Affairs, in testimony at a Pennsylvania Department of Public Welfare (DPW) hearing held today in Philadelphia.

“Based on last year’s experience, the direct effect of this change alone is a $9.7 million rate increase on non-subsidized residential and firm customers, which they will start to feel early in 2007,” Hershey testified.

PGW’s LIHEAP outreach for its customers regularly brings more grants to low-income families than any other utility in Pennsylvania.

Hershey offered the following additional reforms that he said will “respond more adequately to the needs of Philadelphia and Pennsylvania consumers”:

• Add at least $20 million in state funds to federal LIHEAP funds
• Restrict LIHEAP grants to help pay for a customer’s primary heating source only
• Maintain the income eligibility for LIHEAP at 150 percent of the Federal Poverty Level (FPL) as was done last year, and do not decrease, as DPW proposes, to 135 percent of the FPL
• Eliminate costly, unaudited, LIHEAP-funded weatherization programs, and use the funds to provide customers more help with their bill payments
• Extend the LIHEAP application period for as long as funds remain available

Founded in 1836, PGW is the nation’s largest municipally owned natural gas utility serving more than a 500,000 residential, commercial and industrial customers in the City of Philadelphia.