NOTICE OF PROPOSED RATE CHANGES To Our UGI Gas-North District Customers: UGI Utilities, Incs Gas Division (UGI Gas) Is filing a request with the Pennsylvanla Public Utlity Commisslon (PUC) to Increase your natural gas distribution rates as of March 29,2019. Thls notice describes the UGI Gas rate request, the PUC's role, and what actions you can take UGI Gas has requested an overall distribution rate Increase of $71.1 million per year or 89%, which will be recovered from customers served in each of the three rate districts of UGI Gas (South District, North District, and Central District). This request also Includes a proposal to create unform distribution rates and purchased gas cost rates so that all customers of a rate class, in all three rate districts, will be charged the same amount for the same level of service. Creation of a unlform rate will affect customers in each of the districts differently based on the current level of the rates charged Ineach district. The Impact of this proposal on a customer bil is based on changes to both the distrlbution rate and the purchased gas cost rate Distribution rates recover the costs to deliver the natural gas and the purchased gas cost rates recover the costs of purchasing the natural gas from the wholesale supply market. In addition to the changes in distribution rates and purchased gas costrates, an extenslon of the temporary federal tax credit adjustment is being proposed that will reduce customer bils over the 12-month perlod following the effective date of new rates. The following rate impact analysis applles tocustomers that arlocated In the UGI Gas-North District and assumes that the full amount of the proposed rate Increase is granted and that our proposal to create uniform rates is adopted Changes to Distrlbutlon Rates and Purchased Gas Cost Rates Resldential: The total bilil for a resldential customer using 90.6 ccf per month would increase from $89.72 to $97.37 per month or by 8.596. Thisis based on a 52% increase in the distribution rate and a 33% increase in the purchased gas cost rate. Commercial:The total bill for a commercial customer using 31.2 mcfper month would Increase from $241.11 to $28301 permonth or by 17.4%. This ls based on a 13.1% increase in the distribution rate, and a 4.3% increase in the purchased gas cost rate. Industrial: Rates for an industrial customer using 881 mcf per month would increase from $61990 to $731 35 per month or by 18.0%, This Is based on a 1 3.3% increase in the distribution rate, and a 4.7% Increase in the purchased gas cost rate. Extension of Federal Tax Credit In addition to the changes to the distribution rate and the purchased gas cost rate, the company is proposing to extend the existing temporary federal tax credit through the 12-month perlod following the effective date of new rates. As proposed, this credit will reduce the distribution rate porton of customer bills by 450%. To findoutyour customer class or how the requested increase may affect your gas blil contact UGI at 1-800-276-2722.The rates requested by the company may be found In proposed Tarlff Number 7.You may examine the material filed with the PUC whilch explains the requested increase and the reasons for It. A copy of this material Is kept at UGI's office. Upon request, the company will send you the Statement of Reasons for proposed Tariff Number 7, explaining why the rate Increase and the uniform rate proposal have been requested. The state agency which approves rates for public utilities Is the PUC. The PUC will examine the requested rate Increase and can prevent exdsting rates from changlng until it Investigates andfor holds hearings on the request. The company must prove that the requested rates are reasonable. After examining the evidence, the PUC may grant all, some, or none of the rate requests and proposals or may reduce exlsting rates The PUC may change the amount of the rate Increase or decrease requested by the utility for each rate district and each customer dass. Asa result the rate charged to you may be different than the rate requested by the company and shown above. There are three ways to challenge a companys request to change Its rates: 1. You can file a formal complaint. If you want a hearing before a Judge, you must file a formal complaint. By filing a formal complaint, you assure yourselfthe opportunity to take part in hearings about the rate increase request. All complaints should be filed with the PUC ore March 29,2019. If no fomal complaints are filed, the Commlssion may grant all some, or none of the request without holding a hearing before a Judge. 2. You can send a letter telling why you object to the requested rate Increase. Sometimes there Is Information In these letters that makes us aware of problems with the company's service or management. This Information can be helpful when the PUC investigates the rate request. Send your letter or request for a formal complaint form to The Pennsylvania Publk Utility Commission, Post Office Box 3265, Harisburg, PA 17105-3265. 3. You can be a witness at a public input hearing. Public input hearings are held If the Commission opens aninvestigation of the company's rate Increase requested and if thereIs a large number of customers Interested in the case. At these hearings you have the opportunity to presentyour views in person to the PUCJudge hearing the case and the company representatives. All testimony glven under oath becomes part of the official rate case record. For more Information, call the PUC at 1-800-692-7380 You may leave your name and address so you can be notified of any public input hearings that may be scheduled in this case. UG Energy to do more-