Vectren Corporation : Commission approves lower fuel costs to help reduce electric bills

News Release

Jan. 26, 2012

FOR IMMEDIATE RELEASE

Media contact: Chase Kelley, [phone] or [e-mail]

Vectren Corporation One Vectren Square Evansville, IN 47708

Commission approves lower fuel costs to help reduce electric bills in 2012; additional energy efficiency programs underway

Evansville, Ind. - In an effort to alleviate cost pressures on electric bills, Vectren Energy Delivery (Vectren) and the Indiana Office of Utility Consumer Counselor (OUCC) have collaborated to accelerate lower coal costs in
2012 and 2013, an impact that will decrease typical residential electric bills by $6 to $8 per month effective in
February. The proposal was approved this week by the Indiana Utility Regulatory Commission.
Earlier this month, Energizing Indiana, a statewide partnership among Indiana's electric utilities and consumer advocates, launched additional electric energy efficiency programs to help achieve a state-established electric usage reduction goal of 12 percent by 2019. The Energizing Indiana initiative complements Vectren's existing portfolio of energy efficiency programs.
The Energizing Indiana programs, which can be accessed at www.energizingindiana.com, include:

• an on-site home energy assessment;

• automatic discounts on CFL bulbs;

• income-qualified home weatherization;

• school programs; and

• small and large business and industrial rebates, among other initiatives.

This new state-prescribed program is paid for by Indiana's electric customers. Vectren anticipates these energy conservation efforts will cost a typical residential customer about $3 to $5 per month in 2012. However, those who take advantage of these programs and/or Vectren's existing offerings will be able to further reduce their electric usage and bill amounts to more than offset these program costs. Customers of nearly all other Indiana electric utilities will pay similar amounts to achieve the same reduction goals.
"The ever-growing number of energy efficiency programs ensures more customers have the resources to reduce their home or business' energy usage. We remain focused on driving adoption of these programs to achieve the electric reduction goals and know that ultimately, reducing our state's energy use helps delay the need for additional power generation, which would come at a dramatically higher cost, as well as helps reduce power plant emissions," said Carl Chapman, Vectren chairman, president and CEO. "Furthermore, our coal cost reduction effort decreases bill amounts at a time when many customers remain challenged to pay. We're very focused on helping customers manage costs and helping them use energy wisely."
In the spring of 2011, Vectren secured contracts for lower coal costs through a formal bidding process. This lower-priced coal is expected to start being delivered and used at Vectren's power plants by late 2012 to early
2013 and beyond. The recently-approved agreement to accelerate savings into early 2012 means that the existing 2012 coal costs that are above the new, lower prices will be deferred and recovered over a six-year
period without interest beginning in 2014.
The Indiana regulated electric utilities, the OUCC and other consumer advocates have partnered together to offer Energizing Indiana. Visit www.energizingindiana.com or call 888-446-7750 to learn more and visit www.vectren.com/conservation or call 866-240-8476 to learn more about Vectren's gas and electric energy efficiency programs, including rebates on high-efficiency appliances.
Vectren's electric utility serves 142,000 customers in all or portions of seven counties in southwestern Indiana, including Dubois, Gibson, Pike, Posey, Spencer, Vanderburgh and Warrick.

About Vectren

Vectren Corporation (NYSE: VVC) is an energy holding company headquartered in Evansville, Ind. Vectren's energy delivery subsidiaries provide gas and/or electricity to more than 1 million customers in adjoining service
territories that cover nearly two-thirds of Indiana and west central Ohio. Vectren's nonutility subsidiaries and affiliates currently offer energy-related products and services to customers throughout the U.S. These include
infrastructure services, energy services, coal mining and energy marketing. To learn more about Vectren, visit
www.vectren.com.
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