CV Central Vermont Public Service Corp.

Looking back to 2006 and ahead to the future, Central Vermont Public Service (NYSE-CV) today celebrated a year of success and plans to improve customer service and reliability. �We accomplished a great deal in many areas that are vital to our current and future success,� President Bob Young told shareholders gathered for the company�s annual meeting at the Paramount Theatre. �We continued our outstanding performance in customer service and reliability. We significantly improved our financial strength. And we made real in-roads as a partner in planning for Vermont�s electric future.� Young laid out a series of accomplishments in 2006, ranging from top scores for customer service in a survey by JD Power and meeting all 17 of the company�s service quality standards, to strong earnings and total shareholder returns. �Serving our neighbors is a responsibility we take seriously, and we demonstrated that often in 2006,� Young said. Among the 2006 accomplishments Young noted: Creation of the Southern Loop Public Outreach Process, a first-in-Vermont effort to gain public input on transmission issues before proposing solutions. The process lead to a series of public recommendations the company is now working to implement. Expansion of CVPS�s service territory to include the former Rochester Electric Light & Power Company and the southern territory of Vermont Electric Cooperative, adding 3,600 new customers. CVPS met all 17 of the company�s service quality standards, surpassing 16 of them by 10 percent or more. CVPS was ranked first in customer service for the East Region and ranked first among similarly sized utilities in the East for company image, price and value, and billing in the national 2006 JD Power Electric Utility Residential Customer Satisfaction Survey. Completed a stock buyback, returning $51 million derived from the sale of Catamount Energy to shareholders, and reducing the number of shares of outstanding common stock by 18 percent. Earned $1.66 per share and produced total shareholder returns, including earnings and stock price growth, of 36 percent. Invested $18 million in customer service and reliability improvements to CVPS�s systems, and $23 million in Vermont Electric Power Company�s transmission upgrades. Won the Governor�s Award for Environmental Excellence for CVPS Cow Power�, which is now one of the fastest-growing renewable choice programs in the country. �What our customers need today, however, may be very different from their future requirements,� Young said. �We are already anticipating their expectations as Vermont increasingly depends on reliable electric service.� Looking forward Looking ahead, Young said the company had developed a new five-year strategic plan that prioritizes major initiatives company-wide. Among key initiatives planned or being implemented are the following: Integration of CVPS�s sophisticated outage management system with the phone system to make available more frequent and accurate updates to customers during major storms. Implementation of Automated Metering. Full-scale deployment will not begin until 2010, but CVPS is planning a system aligned with future service offerings and enhanced customer service. The remote control afforded by automated metering will allow CVPS to increase energy conservation, better manage peak usage, provide timely, accurate reading and billing, enhance storm restoration efforts, and potentially reduce customer costs. A pilot project to observe the effects of increasing the frequency of vegetation management cycles to determine the most cost-effective cycles possible. A circuit ownership program that pinpoints the company�s least reliable circuits and sections of line, identifies outage causes and applies cost-effective solutions that enhance reliability. An aggressive and comprehensive maintenance schedule for CV�s 119 substations. A plan to increase capital spending to $26 million in 2007, and spending at comparable levels in the years ahead. An alternative regulation plan. CVPS plans to file a proposal this year, which will include mechanisms to encourage cost containment and allow for quicker response to power cost changes. �We believe alternative regulation can improve financial stability, provide assurance that revenues are available to improve customer service and reliability, and increase transparency and accountability to our customers, � Young said. The key for all of these initiatives, Young said, will be to focus on CVPS�s roots. �We will conduct our business with financial integrity to ensure there is an appropriate balance between customer and shareholder interests,� Young said. �We will encourage innovation to create opportunities in energy planning, procurement and services that are aligned with Vermont priorities.� Storm review Young also gave shareholders a brief overview of the worst storm in company history, which knocked out power to more than 60,000 customers last month and did considerable damage to equipment across the company�s territory. Rutland City was the epicenter of the damage. CVPS marshaled the largest restoration effort in company history, including 105 outside line crews, 55 tree crews and hundreds of employees. �Throughout this ordeal, CVPS employees across the state reacted to the bleak situation with fierce determination,� Young said. �Operations staff quickly pulled together to manage and execute the restoration effort, while employees from all other areas responded by supporting logistical needs of this massive undertaking. Many employees worked 18- to 20- hour days, whether stringing line, managing crews, delivering materials, answering customer calls, or providing logistical support. �Customers, state and local officials, and the media were also tremendously helpful and supportive as we worked to restore power. Their cooperation was invaluable,� he said. �We are also grateful for the public�s tremendous support, during and after the storm, which included offerings of hot coffee and home-baked cookies and hand-drawn �thank yous� from neighborhood children. Their sincere gratitude shows that Vermont pulls together during difficult times.� The recovery effort will cost more than $3.5 million, more than double the cost of the previous record. �In the end, your employees made heroic efforts to protect customers and restore service, an effort unmatched by any other in my 20 years with CVPS,� Young said. �They are outstanding professionals with tremendous integrity, and I commend them all for their efforts. The citizens of our state are fortunate indeed to be served by these people, and I am proud to call them my colleagues and friends.�