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May 15, 2013
1
Growth Opportunities:
Converting Customers To
Natural Gas*
John Walsh, President and CEO
*Originally presented at the Citigroup 2013 Global
Energy and Utilities Conference, May 15, 2013
May 15, 2013
2
This presentation contains certain forward-looking statements that management
believes to be reasonable as of today’s date only. Actual results may differ
significantly because of risks and uncertainties that are difficult to predict and many
of which are beyond management’s control. You should read UGI’s Annual Report on
Form 10-K for a more extensive list of factors that could affect results. Among them
are adverse weather conditions, cost volatility and availability of all energy products,
including propane, natural gas, electricity and fuel oil, increased customer
conservation measures, the impact of pending and future legal proceedings,
domestic and international political, regulatory and economic conditions including
currency exchange rate fluctuations (particularly the euro), the timing of development
of Marcellus Shale gas production, the timing and success of our commercial
initiatives and investments to grow our business, and our ability to successfully
integrate acquired businesses, including Heritage Propane, and achieve anticipated
synergies. UGI undertakes no obligation to release revisions to its forward-looking
statements to reflect events or circumstances occurring after today.
About This Presentation
May 15, 2013
3
Background: UGI Utilities
Pennsylvania’s largest gas utility
• ~600,000 gas customers
• 45 of the 67 PA counties served
• Approximately 12,000 miles of main
Major fuel oil conversion program
• Fuel oil still prevalent in PA
• Conversion program for 20+ years
• >40,000 residential conversions
since 2000
•Those customers will save
approximately $63 million in 2013
May 15, 2013
4
Oil is Losing Share in the Northeast
Utility
gas
51%
LP gas
4%
Electricity
12%
Fuel oil,
kerosene
30%
Coal
0%
Wood
2%
Other or
no fuel
1%
Northeast Heating Fuel, 2010
Utility
gas
44%
LP gas
2%
Electricity
12%
Fuel oil,
kerosene
38%
Coal
1%
Wood
2%
Other or no
fuel
1%
Northeast Heating Fuel, 1990
Source: US Census Data, House Heating Fuel
Northeast includes PA, NJ, NY, CT, NH, VT, RI, MA, ME
May 15, 2013
5
Natural Gas/Heating Oil Spread
-$2
$0
$2
$4
$6
$8
$10
$12
$14
$16
$18
1,000
2,000
3,000
4,000
5,000
6,000
7,000
1996
1997
1998
1999
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009
2010
2011
2012
UGI Utilities Residential Gas Conversions/Upgrades
and Gas/Oil Spread
Conversions Spread in Cost
ResidentialConversions/upgrades
Spread,inMMBTU
UGI natural gas customers
will save approximately
$1,600 versus heating oil
customers during the
2012/13 winter
May 15, 2013
6
Mechanics of a Conversion
Goal: Increase gas market share via conversions while significantly
reducing energy costs to PA families and businesses
• Estimated 480,000 non-customers along the main (within 80 ft.), mainly
using oil
May 15, 2013
7
New Customer Growth
2,000
6,000
10,000
14,000
18,000
1995
1996
1997
1998
1999
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009
2010
2011
2012
2013(F)
Total Customer Additionals
Residential New Homes Residential Conversions Residential Upgrades Commercial Additions
+2% average annual net
customer growth
May 15, 2013
8
Keys to Current & Future Conversion Success
Understand/address key needs of conversion customers
• Web-based tools to help them assess the savings opportunity
• Direct contact with customers to review our project plan
• Timely execution and clear scope of responsibilities
UGI recently filed its Growth Extension Tariff for Gas (GET GAS)
• Enables access to gas in unserved and underserved areas
• 10-year surcharge to new customers in lieu of upfront investment
• Five-year pilot program: $15 MM annual commitment
• Potential to reach an additional 300,000 homes and businesses
May 15, 2013
9
Investor Relations:
610-337-7000
Simon Bowman (x3645)
bowmans@ugicorp.com

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UGI presentation on customer conversions, Citigroup 2013 Global Energy and Utilities Conference

  • 1. May 15, 2013 1 Growth Opportunities: Converting Customers To Natural Gas* John Walsh, President and CEO *Originally presented at the Citigroup 2013 Global Energy and Utilities Conference, May 15, 2013
  • 2. May 15, 2013 2 This presentation contains certain forward-looking statements that management believes to be reasonable as of today’s date only. Actual results may differ significantly because of risks and uncertainties that are difficult to predict and many of which are beyond management’s control. You should read UGI’s Annual Report on Form 10-K for a more extensive list of factors that could affect results. Among them are adverse weather conditions, cost volatility and availability of all energy products, including propane, natural gas, electricity and fuel oil, increased customer conservation measures, the impact of pending and future legal proceedings, domestic and international political, regulatory and economic conditions including currency exchange rate fluctuations (particularly the euro), the timing of development of Marcellus Shale gas production, the timing and success of our commercial initiatives and investments to grow our business, and our ability to successfully integrate acquired businesses, including Heritage Propane, and achieve anticipated synergies. UGI undertakes no obligation to release revisions to its forward-looking statements to reflect events or circumstances occurring after today. About This Presentation
  • 3. May 15, 2013 3 Background: UGI Utilities Pennsylvania’s largest gas utility • ~600,000 gas customers • 45 of the 67 PA counties served • Approximately 12,000 miles of main Major fuel oil conversion program • Fuel oil still prevalent in PA • Conversion program for 20+ years • >40,000 residential conversions since 2000 •Those customers will save approximately $63 million in 2013
  • 4. May 15, 2013 4 Oil is Losing Share in the Northeast Utility gas 51% LP gas 4% Electricity 12% Fuel oil, kerosene 30% Coal 0% Wood 2% Other or no fuel 1% Northeast Heating Fuel, 2010 Utility gas 44% LP gas 2% Electricity 12% Fuel oil, kerosene 38% Coal 1% Wood 2% Other or no fuel 1% Northeast Heating Fuel, 1990 Source: US Census Data, House Heating Fuel Northeast includes PA, NJ, NY, CT, NH, VT, RI, MA, ME
  • 5. May 15, 2013 5 Natural Gas/Heating Oil Spread -$2 $0 $2 $4 $6 $8 $10 $12 $14 $16 $18 1,000 2,000 3,000 4,000 5,000 6,000 7,000 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 UGI Utilities Residential Gas Conversions/Upgrades and Gas/Oil Spread Conversions Spread in Cost ResidentialConversions/upgrades Spread,inMMBTU UGI natural gas customers will save approximately $1,600 versus heating oil customers during the 2012/13 winter
  • 6. May 15, 2013 6 Mechanics of a Conversion Goal: Increase gas market share via conversions while significantly reducing energy costs to PA families and businesses • Estimated 480,000 non-customers along the main (within 80 ft.), mainly using oil
  • 7. May 15, 2013 7 New Customer Growth 2,000 6,000 10,000 14,000 18,000 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013(F) Total Customer Additionals Residential New Homes Residential Conversions Residential Upgrades Commercial Additions +2% average annual net customer growth
  • 8. May 15, 2013 8 Keys to Current & Future Conversion Success Understand/address key needs of conversion customers • Web-based tools to help them assess the savings opportunity • Direct contact with customers to review our project plan • Timely execution and clear scope of responsibilities UGI recently filed its Growth Extension Tariff for Gas (GET GAS) • Enables access to gas in unserved and underserved areas • 10-year surcharge to new customers in lieu of upfront investment • Five-year pilot program: $15 MM annual commitment • Potential to reach an additional 300,000 homes and businesses
  • 9. May 15, 2013 9 Investor Relations: 610-337-7000 Simon Bowman (x3645) bowmans@ugicorp.com