1. Presented by Larry Nowicki Manager, Regulatory Compliance Thursday, June 16, 2005 Credit coring A Help to Low Income Customers

2. Fortune 500 holding company headquartered in Merrillville, Indiana. 15 subsidiary companies engage in natural gas transmission, storage & distribution as well as electric generation, transmission & distribution. Deliver energy to more than 3.7 million customers in high energy corridor stretching from the Gulf Coast through the Midwest to New England. Over 16,000 miles of interstate transmission pipeline; 55,000 miles of distribution pipeline. Over 9,000 employees. Income from continuing operations of $430 million in 2004. ABOUT NISOURCE

3. Bay State Gas/Northern Utilities  Customers Mass. – 279,000 N.H. – 26,000 Maine – 24,000 Bay State Gas/Northern Utilities  Customers Mass. – 279,000 N.H. – 26,000 Maine – 24,000 Columbia Gas  Customers Ohio – 1,400,000 Pennsylvania – 401,000 Virginia – 209,000 Kentucky – 141,000 Maryland – 32,000 Columbia Gas  Customers Ohio – 1,400,000 Pennsylvania – 401,000 Virginia – 209,000 Kentucky – 141,000 Maryland – 32,000 Northern Indiana Public Service Northern Indiana Fuel & Light Kokomo Gas  Customers Electric - 443,000 Gas – 776,000 Northern Indiana Public Service Northern Indiana Fuel & Light Kokomo Gas  Customers Electric - 443,000 Gas – 776,000

4. Low-Income Customers 70,038Average number of low- income customers. 70,038Average number of low- income customers. 357,006 Average All Residential Customers 357,006 Average All Residential Customers

5. Credit Scoring Timeline 200020022003 2004 PilotProgram CAP Open Enrollment Chapter 14

6. JOE SCHMO 123-45-6789

7. JOE SCHMO

8. 123-45-6789 222 W MAIN RED LION 123-45-6789

9. 222 W MAIN RED LION 123-45-6789 JOE SCHMO

10. Application Process First Contact with Customer First Contact with Customer Screening Screening Early referrals to Universal Services Early referrals to Universal Services

11. Results Accounts scoring 750 or less in years 2003 and 2004. 20032004 44%32% of customers scoring < 750 identified as level 1 or 2. 3%2% of customers scoring < 750 identified as level 3 or 4. 53%66% of customers scoring < 750 not identified (never obtained financial info). Accounts scoring >= 750 connected in years 2003 and 2004. 20032004 12%8% of customers scoring >= 750 identified as level 1 or 2. 2%1% of customers scoring >= 750 identified as level 3 or 4. 86%91% of customers scoring >= 750 not identified (never obtained financial info).

12. Results Verification Verification 11% of customers who were credit scored were low income 11% of customers who were credit scored were low income

13. Results Number of applicants scored 131,029 Number of applicants with passing scores 82,107 Number of applicants with failing scores 48,922 Number of deposits obtained 44,735 Number of deposits waived 5,381 Waivers due to credit score error 49 Waivers due to improvement in credit score 26 Columbia Gas of Pennsylvania Inc. Credit Scoring Pilot Program Report Summary of Period June 2001 Through October 2003

14. Results Waived deposits Waived deposits Number of deposits X average deposit amount Number of deposits X average deposit amount 5,381 X $162 = savings for low income customers

15. Results Number of deposits waived X average CAP Charge-off Number of deposits waived X average CAP Charge-off 5,381 X $762 = avoided costs to utility for charge-off

16. Results Other utility bottom line benefits Other utility bottom line benefits Cash working capital Cash working capital Reduced collection costs due to early identification Reduced collection costs due to early identification

17. Results Fewer complaints Fewer complaints 17 complaints over four years 17 complaints over four years

18. Results Affordable benefits Affordable benefits CAP payment credit ($51) X number of waived CAP security deposits = total payment credit for CAP customers who were credit scored CAP payment credit ($51) X number of waived CAP security deposits = total payment credit for CAP customers who were credit scored

19. Benefits of Credit Scoring Waived security deposits Waived security deposits Affordable payment plans Affordable payment plans Energy assistance Energy assistance Building good credit Building good credit Promotes goodwill with company Promotes goodwill with company

20. Credit Scoring WIN/WIN vs. Utility Benefit Low Income Help