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FOR A GENERAL INCREASE IN RATES BY

COMMONWEALTH GAS SERVICES, INC.

CASE NO. PUE900034

On April 30,1990, Commonwealth Gas Services, Inc. (“the Company” or “Services”) filed an application for a general increase in its rates for natural gas service with the State Corporation Commission (“Commission”). As part of its application, the Company has requested that it be permitted to revise its tariffs to produce an increase in additional annual revenues of $12,641,944, an increase of 8.9% over the adjusted annualized revenues produced by Services' rates during the test period, i.e., the twelve months ending December 31,1989. The Company also proposed to establish a new, unified gas tariff to be effective throughout its service area to replace the three sets of tariffs now in effect in the Company’s service territory which includes the former service areas of Columbia Gas of Virginia, Inc. ("CVA") and Lynchburg Gas Company (“Lynchburg”). Services, CVA, and Lynchburg have merged into a single company. Services is the surviving corporation.

As part of its tariff consolidation, the Company intends to reprice and restructure many of its rates and tariffs and to revise portions of its terms and conditions of service. However, Services has stated that it intends to maintain separate base rates for residential customers presently receiving service under the Company’s Lynchburg tariffs.

In addition, the Company's application proposes to offer sales sen/ice to residential customers, a customer class defined to include individual residences and separately metered residences within multifamily buildings. As part of its sales service to residential customers, Services proposes to continue to allow an exemption from its separate metering requirements for existing multi-family buildings of four families or less. The Company has also rewritten the overrun and penalty provisions for Rate Schedules LIGS, ISS, FIS, ITS and SS to bring them into these rate schedules and to allow for authorized overruns at various rate levels when excess natural gas or capacity is available and to penalize customers only for exceeding contracted-for levels of natural gas service without permission or for failure to discontinue interruptible curtailable service upon notice. The Company further proposes to close its Lerge Volume Economic Development Transportation Service as of January 1, 1990. It proposes that customers receiving service under that tariff before January 1, 1990, would continue to be served under the closed tariff.

Finally, Services proposes to use a untied system average of natural gas costs to calculate its purchased gas adjustment ("PGA”) clause. It proposes to track actual cost adjustments, prior period refunds and take-or-pay adjustments separately for the formerly separate service territories of CVA, Lynchburg, and Services. The Company has stated in its application that its proposed revisions to its PGA may create some cost shifting within the former service territories of CVA, Lynchburg, and Services. The details of these and other tariff revisions are set forth in Services’ application. Interested persons are encouraged to review Services’ application and supporting exhibits for the details of these and other proposals.

The Commission has suspended Services’ proposed tariff revisions through September 27, 1990. Interested persons should be advised that after considering all of the evidence, the Commission may prescribe rates, charges, and terms and conditions of service applicable to natural gas service which differ from those appearing in the Company’s application.

The Commission has scheduled a public hearing before a hearing examiner, to be held on September 18, 1990, at 10:00 a.m., in the Commission’s 13th Floor Courtroom, located in the Jefferson Building, 1220 Bank Street, Richmond, Virginia. The purpose of this hearing is to receive evidence relevant to the Company's application.

A copy of the Company’s application is available for public inspection during regular business hours at all Services' offices where customer bills may be paid, and from 8:15 a.m. to 5:00 p.m., Monday through Friday, at the State Corporation Commission, Document Control Center, Floor B-1, Jefferson Building, 1220 Bank Street, Richmond, Virginia.

Any person desiring to comment in writing on the Company’s applicaton may do so by directing such comments on or before July 31, 1990, to the Clerk of the Commission, c/o Document Control Center, P.O. Box 2118, Richmond, Virginia 23216. Such comments must refer to Case No. PUE900034. Any person desiring to make a statement at the public hearing, either for or against the application, need only appear in the Commission's 13th Floor Courtroom at 9:45 a.m. on the day of the hearing and identify himself or herself as a public witness to the Commission’s bailiff.

On or before July 31,1990, any person desiring to participate as a protestant, as defined in Rule 4:6 of the Commission’s Rules of Practice and Procedure (“Rules”), shall file an original and fifteen (15) copies of a notice of protest, as provided in Rule 5:16 (a), and shall serve a copy of same on the Company’s counsel, Stephen H. Watts, II, Esquire, and Jacquelyn E. Stone, Esquire, McGuire, Woods, Battle & Boothe, One James Center, 901 East Cary Street, Richmond, Virginia 23219.

Within five (5) days of the receipt of any notice of protest, Services shall serve upon each protestant a copy of all material now or hereafter filed with the State Corporation Commission.

Any person who expects to submit evidence, cross-examine witnesses or otherwise participate in the proceeding as a protestant, pursuant to Rule 4:6, shall file on or before August 21, 1990, an original and fifteen (15) copies of a protest with the Clerk of the State Corporation Commission, c/o Document Control Center, P.O. Box 2118, Richmond, Virginia 23216, referring to Case No. PUE900034, and shall simultaneously send a copy thereof to Services' counsel: Stephen H. Watts, II, Esquire, and Jacquelyn E. Stone, Esquire, McGuire, Woods, Battle & Boothe, One James Center, 901 East Cary Street, Richmond, Virginia 23219. The protest shall set forth (1) a precise statement of the interest of the protestant in the proceeding; (ii) a full and clear statement of the facts which the protestant is prepared to prove by competent evidence; and (iii) a statement of the specific relief sought and the legal basis therefor. Any corporate entity that wishes to submit evidence, cross-examine witnesses or otherwise participate as a protestant must be represented by legal counsel in accordance with the requirements of Rule 4:8 of the Commission’s Rules of Practice and Procedure.

On or before August 21, 1990, each protestant shall file with the Clerk of the Commission an original and fifteen (15) copies of the prepared testimony and exhibits the protestant intends to present at the September 18, 1990 hearing, and shall simultaneously mail a copy td the Company’s counsel and other protestants. Service shall be directed to the Company's counsel at the following address: Stephen H. Watts, II, Esquire, and Jacquelyn E. Stone, Esquire, McGuire, Woods, Battle & Boothe, One James Center, 901 East Cary Street, Richmond, Virginia 23219.

Any party participating as a protestant should review the instructions regarding discovery set forth in the Commission's Order in this proceeding dated June 13,1990.

All written communications to the Commission should be directed to George W. Bryant, Jr., Clerk, State Corporation Commission, c/o Document Control Center, P.O. Box 2118, Richmond, Virginia 23216, and should refer to Case No. PUE900034.

COMMONWEALTH GAS SERVICES, INC.