June 26, 2007

The Michigan Public Service Commission (MPSC) today approved a settlement accepting jurisdiction of SEMCO Energy Gas Company's Battle Creek Division. Rates will not change as a result of this jurisdictional change. The MPSC also approved settlement agreements that adopt the gas cost recovery (GCR) clause and authorize SEMCO to implement a GCR factor.

On May 9, 2006 SEMCO and the City of Battle Creek filed a joint application with the MPSC requesting that the MPSC accept jurisdiction over the fixing of rates, charges and conditions for providing natural gas service in Battle Creek, several municipalities adjacent to Battle Creek and special contract customers in Battle Creek, and for approval of SEMCO Battle Creek Division's tariffs, rates, charges and conditions of service.

In Case No. U-14882, the MPSC authorized the settlement agreement reached by SEMCO, Battle Creek and the MPSC staff. Under the agreement, SEMCO is authorized to collect $720,000 of costs annually through a monthly fixed customer charge for the Battle Creek Division. Rates will not change as a result of this order.

In Case Nos. U-15129 and U-15130, the MPSC approved settlement agreements that adopt the GCR clause and implement a GCR factor of up to $9.0123 per decatherm. One decatherm is equal to approximately one thousand cubic feet (Mcf).

SEMCO, the MPSC staff and the Attorney General participated in these cases. The parties reached a settlement agreement, with the Attorney General filing a statement of non-objection.

The MPSC is an agency within the Department of Labor & Economic Growth.

Case Nos. U-14882, U-15129 and U-15130