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CENTRAL HUDSON GOES GREEN WITH ITS FLEET
IRENE Tropical storm slams region	FUND 'Good Neighbors' can win prizes	MOBILE APP Free new feature is available	INVESTMENTS Investing in our infrastructure	SAFETY Tips to prep your home for winter
ALSO: 10 tips for energy shoppers | Our people | President Laurito Q&A | Three win smartphones

Central Hudson's fleet going green

Central Hudson is proudly growing its fleet of green vehicles. In addition to a Toyota Prius and the use of a biodiesel fuel blend in all of our heavy-duty trucks, in 2011 we have added the following:

• Eight hybrid line trucks: These hybrid diesel-electric line trucks were placed in regular use in our daily operations in recent months. The trucks were purchased as part of our normal vehicle replacement program, with the incremental hybrid technology costs funded through NYSERDA’s Statewide Alternative Fuel Vehicle Program on behalf of the Clean Cities Coalitions in New York.
• Three Dodge Ram plug-in electric hybrid pickup trucks: Central Hudson was one of 10 organizations in the country to receive Dodge Ram 4X4 plug-in electric hybrid pick-up trucks from Chrysler Corporation to test over a three-year period. Central Hudson received the vehicles in September, at no charge from Chrysler, in exchange for helping the automaker in its field study of electric vehicles.
• A 2011 Chevy Volt: A Chevrolet Volt was added to Central Hudson’s fleet in August. The vehicle is being tested as part of a research and development program for plug-in electric hybrid vehicles as part of our preparations for the anticipated use of plug-in vehicles by local residents and businesses in the years ahead. Many customers had the opportunity to check out the vehicle on display at our booth at the 2011 Dutchess County Fair in August.

“Electricity as a fuel is less than half the cost of gasoline, and emissions from electric generation sources are about 70 percent less than those of gasoline engines,” said James P. Laurito, President of Central Hudson. “These vehicles will help protect the environment while reducing operating costs.”

Q: What is Central Hudson's stance on the importance of renewable energy?

A: Since deregulation took place more than 10 years ago, Central Hudson and other New York state utilities are no longer allowed to build or operate power plants. We now continue to serve as your energy delivery company and are responsible for maintaining the electric and gas infrastructure as well as ensuring the reliable flow of energy to about 300,000 homes and businesses in the region.

Even though most customers pay their entire energy bill through Central Hudson, it is only the delivery portion of that bill that goes to Central Hudson. We generally do not have control over the sources that are used to supply that energy. However, we do value the importance of renewable energy and have been proactive where we can be in doing our part to champion the development and use of renewable energy technologies.

Some examples:

• While we were required to sell off our power plants during deregulation, we were allowed to keep some small hydro-electric facilities in the region. Our hydro-electric facilities still provide electricity to about 2 percent of homes in our service territory in the Hudson Valley. And we continue to invest in those green facilities in an effort to extend their usefulness and maximize the power that can be drawn from that clean, renewable energy source.

• Central Hudson has also been named one of the leading utilities in support of solar energy by the Solar Electric Power Association four years in a row. There is a high concentration of solar power users in our territory and we have a strong net metering program in place that allows people with home solar installations to sell excess power back to us. You can learn more about that system on this page of our website. To further enhance our net metering operations and support our customers who use solar power, and the local professionals who install solar power systems, we hosted a "Solar Summit" at our Kingston office earlier this year. More than 70 solar energy professionals from the Hudson Valley attended this event. It included speakers from Central Hudson and various solar industry groups. Those who attended overwhelmingly expressed their appreciation for the event. It was a great way to strengthen relationships and do our part to bolster the use of this renewable resource here in the Hudson Valley.

• We also aggressively promote green power and educate customers about the options they all have to support renewable energy. Visit the Green Power page of our website to find out your options for supporting the production of renewable fuels here in New York state with your energy dollars.

Irene: Second-largest storm in our history

Clockwise from top: 1) One of many scenes where huge sections of roads were washed out in Central Hudson's service territory because of flooding brought by Tropical Storm Irene. This photo shows County Route 17 in the Town of Jewett (Greene County). Three sections of utility lines and 685 feet of road were wiped out at this one site alone. 2) An SUV that had fallen into a roadside sinkhole in Newburgh during Tropical Storm Irene. 3) A convoy of Central Hudson line and pickup trucks moves from one repair site to another in the Town of Rochester (Ulster County). 4) A Central Hudson lineman repairs an outage in the Town of Hurley (Ulster County) the day of the storm. 5) Another lineman goes up in a bucket truck to make a repair in New Paltz on the day of the storm. 6) Raging waters from the Catskill Creek crash into and over the South Cairo Bridge in Greene County. 7) One of our linemen wades through fallen trees to repair an outage.

Tropical Storm Irene slammed the Hudson Valley on Aug. 28, 2011. Severe, sustained winds toppled trees and snapped 300 utility poles while excessive rain flooded entire towns and washed away numerous roads and bridges. The storm knocked out power to 180,000 Central Hudson customers, making it the second-most disruptive storm event in company history.

“Hurricane Irene was downgraded to a tropical storm by the time the weather system reached our area, but that was of little consolation to the region,” said Central Hudson President James P. Laurito. “Although this was the second-worst storm in our history, parts of the Mid-Hudson Valley region had never seen anything like this,” he said. “The challenges were daunting – trees completely blocking long stretches of roadways, eroded and collapsed culverts, destroyed bridges, neighborhoods flooded by fast-moving water and in some areas utility poles were completely washed away and underground natural gas lines exposed. This made for very dangerous working conditions, and hampered travel to some of the hardest-hit areas. It took a concerted effort by emergency services, highway departments and utility crews to open roads and restore services quickly and safely.”

Preparation for the topical storm was also extensive. Central Hudson participated in conference calls with the National Weather Service and other utilities in order to gauge the potential impact to the region. Mutual aid crews from other utilities and private contractors were brought in from as far as Florida and Kansas to assist in the restoration effort, despite the widespread need for assistance by many other utilities in Irene’s path from North Carolina to Maine.

“As a community we prevailed,” said Laurito. “Nature dealt a strong blow, and everyone pitched in. We’re also proud to report that Central Hudson employees and contractors came through the ordeal without one serious injury.”

Although the storms have passed, work continues for many communities, and for Central Hudson. Crews are inspecting natural gas lines and regulator stations, particularly in areas where serious erosion occurred, to ensure that the gas system continues to operate safely and effectively. Crews are also inspecting electric lines for damage that may not have affected service during these storms, but may during the next storm. Central Hudson is conducting a self-assessment, as is performed after every major storm event, so that lessons learned can be included in its emergency plan.

Help a neighbor and be entered to win

Are you familiar with Central Hudson’s Good Neighbor Fund? Funded by voluntary contributions from Central Hudson employees and customers and matched by Central Hudson’s shareholders, the Good Neighbor Fund provides last resort funding to help customers who have exhausted all other forms of public assistance meet their energy needs.

The Good Neighbor Fund is administered by The Salvation Army and has been helping people right here in the Hudson Valley for more than 25 years. In recent years however, rising demand for these funds combined with a diminishing supply of donations has put a major strain on the Good Neighbor Fund’s ability to keep pace to help those in need.

To draw attention to this need and reward those who help their neighbors, for a limited time, Central Hudson has teamed with CDW and BitbyBit to offer a Lenovo laptop computer and Flip Ultra HD video camera as incentive prizes. Now through Nov. 30, any customer who makes a $10 donation to the Good Neighbor Fund will be entered into a drawing for these two great prizes. The laptop was generously donated by BitbyBit and the Flip camera by CDW. Visit www.centralhudson.com/goodneighborfund/ for more details about this promotion and complete prize drawing rules.

Neighbors helping neighbors. That’s what the Good Neighbor Fund is all about.

HOT SAVINGS

Natural gas furnaces
$140-$420
If you are a natural gas customer, let us give you a rebate of between $140 and $420 on a new, energy-efficient furnace. The higher the efficiency rating, the higher the rebate. You can add this incentive to a $150 federal tax credit to further reduce your final cost!

Natural gas boilers
$350-$700
We offer a rebate of between $350 and $700 for installing a new, energy-efficient boiler. This rebate is for both water and steam boilers. You can add this incentive to a $150 federal tax credit to further reduce your final cost!

Heat pump water heaters
$400
Is your water heater unreliable or costly to operate? Central Hudson has a $400 rebate for energy efficient heat pump water heaters. For this rebate, you may use a SavingsCentral Trade Ally or install it yourself. You can add this incentive to a $300 federal tax credit to further reduce your final cost!

Central air-source heat pumps
$400-$600
Central air-source heat pumps provide efficient heating during the fall and spring. Ductless heat pumps are perfect for those who want energy-efficient heating but do not have air ducts in their home. The added bonus is that heat pumps work in reverse and cool your home during the summer! For this rebate ($400 to $600 depending on efficiency rating), you must use a SavingsCentral Trade Ally for installation. Energy efficient heat pumps are also eligible for a $300 federal tax credit.

Free Central Hudson Mobile App is here!

Central Hudson launched its new, free mobile app this summer. The app, available for Android and Apple users, allows all customers to:

• Make a payment
• Report an electric power outage
• Check status of an outage
• View outage summary by county and municipality
• View the outage map
• View payment locations
• View contact information

Customers who are registered for a CentralHudson.com “Your Account” can also log in to:

• View account summary, balance, and payment due date
• View payment history

Thousands of customers downloaded the app during Hurricane Irene to monitor outage restoration progress. Users have currently rated the app at 4.1 out of a possible 5 stars on the Android Market.

10 tips to help you shop for energy

As a result of deregulation, Central Hudson is an energy delivery company only. What this means, basically, is that we repair and maintain the 10,229 miles of electrical transmission and distribution lines, and 1,340 miles of gas transmission and distribution lines that are found throughout the Hudson Valley to ensure the constant, safe flow of energy to your home or business. We no longer own electric generating facilities (other than our small, local hydroelectric stations, which use renewable energy to provide less than two percent of our customers’ total electric energy needs). Power plants we formerly owned were sold to independent companies that, together with other generators throughout New York, now sell their energy into the wholesale market. It is through this market that Central Hudson purchases electricity on your behalf. We do not charge any markup or profit from this service or for the supply of kilowatt hours of electricity or cubic feet of natural gas themselves.

Competitive energy suppliers, known as “ESCOs,” also exist and offer alternatives for you to shop to purchase your energy supply only. Regardless of who you choose to be your energy supply company, Central Hudson will remain your energy delivery company. Supply and delivery charges are itemized on your Central Hudson bill. Review those charges for a better picture of what your energy costs are.

The search for the best price is the main reason customers shop for energy supply companies. However, you should take the time to understand what’s available and you should choose a supplier that deals with you fairly and honestly. Consider this list of “Top 10” things to keep in mind as you shop:

1. Apply good old common sense

Consumer advocates warn shoppers that “if the deal sounds too good to be true, it probably is”. If someone tells you that you can save a huge amount by switching suppliers, make sure you get it in writing.

2. Variable vs. fixed pricing

Be sure you understand if the product you’re buying is variable (where the price changes monthly or at some other interval), or if it’s fixed (where the price stays the same for a period of time). A fixed price deal will generally require that you stay with the ESCO for a year or longer. Some ESCOs also offer “green” energy products, which can affect the cost.

3. Compare offers to current market price

If what you're being offered is a fixed price, know what the fixed price is, and compare it to current prices. Fixed prices will generally be somewhat higher than current market prices. If it’s variable, ask what it is today, so you can determine if it’s reasonable compared to current levels. You can find Central Hudson’s current prices on your most recent bill, on our website – along with our month-by-month pricing history – or by calling us at (845) 452-2700.

4. Is there an early termination fee?

Ask if there if an early termination fee, such as you’d pay for ending a cell phone contract early.

5. Protect your account, Social Security numbers

Remember that your Central Hudson account number is the key to switching your account. DO NOT give out your account number until you have decided that you want to switch to the new supplier (ESCO). That account number may be all that an ESCO needs to switch your account, without your full knowledge and understanding. And no one has the right to insist that you give out personal information, such as social security numbers or banking information. Your account number appears on each page of your bill.

6. Buyer's remorse? Use brief window to cancel

Realize that in most cases, you have three business days after you agree to switch, during which you can rescind the agreement without penalty.

7. Salespeople aren't from Central Hudson

Make sure you know whom you’re dealing with. Central Hudson never calls or comes to the door offering to sell you anything. If a salesperson claims to represent Central Hudson, they are not being truthful and you should not deal with them. All authorized ESCOs are required to present identification showing their name and the name of their company. Ask to see it.

8. Check seller's complaint rates

You may want to check the complaint statistics for the ESCOs at the website of the New York State Public Service Commission. The details of the complaints are on the last two pages of the most recent monthly report. Keep in mind that some ESCOs have more sales contacts than others, which can affect the number of complaints.

9. Use this online resource to compare prices

Compare residential prices at New York’s “Power to Choose” website. By entering your zip code, you can see a selection of competing offers and their terms.

10. Keep an eye on your pricing

Remember that energy prices can be volatile, and are often affected by weather, economic conditions and world events. It is wise to periodically check what you are currently paying for your energy supply, and to have a trusted supplier.

You have the right to shop other suppliers, and we encourage you to exercise that right. But you are never required to choose another supplier. Central Hudson will always be here to provide your energy and to deliver it to you safely and reliably. That’s what choice is all about. You wouldn’t go out and buy a new television or oven without shopping carefully. You should use the same care in choosing who will supply the energy that powers those devices.

MARKETING PLOYS

The vast majority of the ESCOs who seek to sell electricity and gas to Central Hudson customers are honest and fair, and they play by the rules established by New York State. But sometimes individual salespersons, in an effort to increase sales, will make statements that are not true. Some of these common tactics include:

Fiction: Central Hudson will no longer be able to supply your energy in the future.
Fact: Central Hudson will always be here to provide energy and delivery service to those who choose it.

Fiction: Central Hudson asked them to call or visit you in order to alert you to some new program or special discount.
Fact: Independent sellers of energy products (ESCOs) and Central Hudson are not affiliated in any way. We never use salespeople to announce new programs, and our rates are set by state regulators and apply to all customers (within a rate class) equally, so no one is offered a special discount.

Fiction: They are calling to correct some billing error or overcharge by Central Hudson, so that you get credit for the mistake.
Fact: This is a tactic to lure you into thinking you’ll get some financial windfall if you sign up with them.

Fiction: Use of phrases like “We are the Central Hudson approved agent” or “We have New York State approval” to imply exclusive rights.
Fact: Every ESCO must be approved by both New York State and by Central Hudson in order to sell energy in our area. This approval simply means they are financially sound and have properly registered to do business in the State. It does not convey any special privilege or mean they have been specially selected or have any extraordinary rights that other ESCOs do not have.

Fiction: There is a time limit on your ability to switch, and you will miss the deadline if you don’t give them your account number right now.
Fact: There are no deadlines and no limits on your ability to switch from one supplier to another.

Fiction: There are sales tax savings of “up to 13%” for switching.
Fact: No residential customer in the state pays tax rates anywhere near that level, and for most customers in our area the tax rate is zero.

One last fact: If you have any doubts about the offer being made to you, remember there is no need to act until you get the facts. Ask the salesperson to leave the information with you. If you need help understanding anything, contact us. We’ll be happy to help.

Central Hudson makes major investments to improve local energy infrastructure

Delivering electricity and natural gas to our customers – safely, reliably and constantly – is a responsibility Central Hudson takes most seriously.

We are making significant investments in energy delivery systems and infrastructure, including the construction of new electric substations, improvements to our electrical transmission system, and upgrades to local distribution lines. In the last decade, we made investments of more than $475 million on such projects and expect to spend another $39 million in 2011. Another $81.5 million was invested in line clearance to keep tree limbs and vegetation away from our wires, and we will spend another $14 million on that this year.

We’re also undertaking a multi-year project to replace aging natural gas mains, particularly in urban areas, with newer, more modern materials. These investments totaled more than $123 million over the last ten years, with another $7.5 million to be invested this year.

Investments like these pay off in fewer outages, increased capacity to meet higher energy demand, and improved safety and service for you. We will continue to invest prudently in the years ahead to improve the reliability of your service.

Now is the time to prepare for winter

Cold weather is around the corner and Central Hudson advises you to prepare by taking steps keep your home safe. Some suggestions:

• Have your furnace, boiler and entire heating system serviced to ensure it’s working properly.
• If you have a carbon monoxide detector, test it.
  If you don’t, get one installed. Carbon monoxide
  is colorless, odorless and poisonous. Having a working carbon monoxide detector in your home is your best safeguard against this noxious gas.
• Never attempt to heat your home with your kitchen stove or an outdoor grill. These are extreme fire hazards and can also cause a buildup of carbon monoxide.
• Make sure exhaust flues and chimneys are cleared of excess soot and debris. Clogged flues and chimneys also present the dual threat of fire and carbon monoxide poisoning.

Three customers win smartphones after
signing up for our paperless billing option

Customers who switched from receiving a paper bill to our electronic eBills option from July 1 through Sept. 15 were entered in a drawing for a smartphone and a generous bill credit. Clockwise from above: Philip Meltzer of Rhinebeck was one of the three lucky winners of this promotion; Bill Kane of Lagrangeville, left, receives his prize from Central Hudson Director of Corporate Communications, Paul Tesoro; and Joe Tumay of Catskill collects his prize at our Kingston office.

Three lucky customers won smartphones for choosing eBills, Central Hudson’s paperless billing option, this summer. Philip Meltzer of Rhinebeck; Joe Tumay of Catskill; and Bill Kane of Lagrangeville were each selected in the random drawing and won a prize package worth up to $1,000, including an upgraded phone and extended cellular service.

EBills is the green, convenient and cost-effective way to conduct your transactions with Central Hudson. It’s green because it eliminates the need for paper in the process. It’s convenient because it eliminates your need to search for a stamp or make extra trips to the post office, and it's cost effective because there’s no postage expense involved. In total, customers together would save more than $1 million in return postage costs if every Central Hudson customer switched to eBills. And Central Hudson's expenses associated with bill processing and mailing would be reduced by an additional $1 million, with these savings ultimately passed back to customers.

Produced by the Corporate Communications Division
Central Hudson Gas & Electric Corp.
284 South Avenue
Poughkeepsie, NY, 12601
www.CentralHudson.com

Send questions and comments about PowerTalk to ptesoro@cenhud.com or chayes@cenhud.com.