Community Natural Gas GCA 168 Rate Decrease Approved

STATE OF INDIANA INDIANA UTILITY REGULATORY COMMISSION GAS CO., INC. FOR ) CAUSE NO. 37488 GCA 168 CHANGES IN ITS RATES THROUGH A GAS ) COST ADJUSTMENT IN ACCORDANCE ) APPROVED: ORDER OF THE COMMISSION Presiding Officer: Kristin E. Kresge, Administrative Law Judge

On February 23, 2026, pursuant to Ind. Code § 8-1-2-42, Community Natural Gas Co., Inc. ("Petitioner") filed its Petition for a gas cost adjustment ("GCA") with attached schedules to be applicable during the months of May through July 2026. Contemporaneously, Petitioner filed the direct testimony of Mandy Leach. On March 6, 2026, Petitioner filed its revised schedules. On March 17, 2026, the Indiana Office of Utility Consumer Counselor ("OUCC") filed the direct testimony of Mark H. Grosskopf, Senior Utility Analyst in the OUCC's Natural Gas Division. The Indiana Utility Regulatory Commission ("Commission") held an evidentiary hearing in this Cause on April 13, 2026, at 9:00 a.m. in Room 222, PNC Center, 101 West Washington Street, Indianapolis, Indiana. Petitioner and the OUCC appeared by counsel at the hearing, during which their respective testimony and exhibits were admitted into the record without objection. Based upon the applicable law and the evidence presented, the Commission finds:

1. Statutory Notice and Commission Jurisdiction. Notice of the hearing in this
   Cause was given and published as required by law. Petitioner is a public utility as defined in Ind. Code § 8-1-2-1(a). Under Ind. Code § 8-1-2-42(g), the Commission has jurisdiction over changes to Petitioner's rates and charges related to adjustments in gas costs. Therefore, the Commission has jurisdiction over Petitioner and the subject matter of this Cause.

2. Petitioner's Characteristics. Petitioner is a corporation organized and existing
   under the laws of Indiana. Petitioner's principal office is in Owensville, Indiana. Petitioner renders natural gas utility service to the public in Gibson, Posey, Dubois, Spencer, Greene, Monroe, Pike, Warrick, Owen, and Sullivan Counties and owns, operates, manages, and controls plant and equipment for the distribution and furnishing of such service.

3. Source of Natural Gas. Ind. Code § 8-1-2-42(g)(3)(A) requires Petitioner to make
   every reasonable effort to acquire long-term gas supplies to provide gas to its retail customers at the lowest gas cost reasonably possible. Ms. Leach testified that Petitioner's estimating and purchasing strategies have not changed from those described last to the Commission. She ORIGINAL described Petitioner's strategy on estimating natural gas usage and determining appropriate CommissionerYes No PETITION OF COMMUNITY NATURAL ) Zay APPROVAL OF Deig ger SwinVeleta APR 22 2026Not WITH IND. CODE § 8-1-2-42(g) ) Ziegner Participating √ √ √ √ √

purchases of natural gas, which includes analysis of actual usage by month over a prior ten-year period. Petitioner also reviews current and future NYMEX pricing, discusses trends in natural gas pricing with its marketer, and considers what benefits can be obtained for its customers by hedging through fixed contracts or storage gas. Ms. Leach described some of the challenges associated with determining whether to hedge and concluded that based on Petitioner's strategy, Petitioner is able to provide sufficient natural gas to its customers at a reasonable price. She also set forth Petitioner's methods to mitigate volatility in customers' bills. This includes monitoring the usage of its customers, acquiring fixed contracts for future use, refilling storage during the summer months when gas prices are typically at their lowest, the use of a normal temperature adjustment mechanism, monitoring trends in the natural gas market, and the use of a flexing mechanism to reduce significant variances. The Commission has indicated that Indiana's gas utilities should make reasonable efforts to mitigate gas price volatility. This includes a program that considers market conditions and the price of natural gas on both a current and a forward-looking basis. Based on the evidence offered, we find that Petitioner has demonstrated that it has and continues to follow a policy of securing natural gas supply at the lowest gas cost reasonably possible in order to meet anticipated customer requirements. Therefore, we find that the requirement of this statutory provision has been fulfilled.

1. Purchased Gas Cost Rates. Ind. Code § 8-1-2-42(g)(3)(B) requires that
   Petitioner's pipeline suppliers have requested or filed pursuant to the jurisdiction and procedures of a duly constituted regulatory authority, the costs proposed to be included in the GCA factor. The evidence of record indicates that the proposed gas costs include transport rates that have been filed by Petitioner's pipeline suppliers as authorized by the Federal Energy Regulatory Commission. We have reviewed the cost of gas included in the proposed gas cost adjustment charge and find the cost to be reasonable. Therefore, we find that the requirement of this statutory provision has been fulfilled.

2. Earnings Test. Ind. Code § 8-1-2-42(g)(3)(C), in effect, prohibits approval of a
   GCA factor that results in Petitioner earning a return in excess of the return authorized by the last Commission Order in which Petitioner's basic rates and charges were approved. Petitioner's basic rates and charges in effect during this GCA period were approved on September 24, 2025, in Cause No. 46209. In that Order, the Commission authorized Petitioner to earn 8.27% and net operating income of $1,490,869 on an original cost rate base of $18,027,426. Petitioner's evidence indicates that for the 12 months ending December 31, 2025, Petitioner's actual net operating income was $1,324,988 and Petitioner's prorated authorized net operating income for GCA 168 is $1,407,255. Therefore, based on the evidence of record, the Commission finds that Petitioner is not earning in excess of that authorized in the applicable rate case.

3. Estimation of Purchased Gas Costs. Ind. Code § 8-1-2-42(g)(3)(D) requires that
   Petitioner's estimate of its prospective average gas costs for each future recovery period be reasonable. The Commission has determined that a comparison of the variance to the incremental cost of gas on Schedule 6 be used to determine if the prior estimates are reasonable when compared to the corresponding actual costs. A 12-month rolling average comparison helps to eliminate the inherent variance related to cycle billing and seasonal fluctuations. The evidence presented indicates Petitioner's 12-month rolling average comparison was negative 3.39% for the period 2

ending December 31, 2025. Based on Petitioner's historical accuracy in estimating the cost of gas, we find that Petitioner's estimating techniques are sound, and Petitioner's prospective average estimate of gas costs is reasonable.

1. Reconciliations.

2. Variances. Ind. Code § 8-1-2-42(g)(3)(D) also requires that Petitioner
   reconcile its estimate for a previous recovery period with the actual purchased gas cost for that period. The evidence presented in this proceeding establishes that the variance for the reconciliation period of October 2025 through December 2025 ("Reconciliation Period") is an over-collection of $27,057 from its customers. This amount should be included, based on estimated sales percentages, in this GCA and the next three GCAs. The amount of the Reconciliation Period variance to be included in this GCA is a decrease in the estimated net cost of gas of $2,772. The variance from prior recovery periods applicable to the current recovery period is an over-collection of $10,783. Combining this amount with the Reconciliation Period variance results in a total over-collection of $13,555 to be applied in this GCA as a decrease in the estimated net cost of gas.

3. Refunds. Petitioner had no refunds from its pipeline suppliers during the
   Reconciliation Period and has $4,498 in refunds from prior periods applicable to the current recovery period. We find that the amount to be refunded to customers in this GCA is $4,498 as reflected on Schedule 12A.

4. Resulting Gas Cost Adjustment Factor. The estimated net cost of gas to be
   recovered is $150,094 for May 2026, $125,821 for June 2026, and $122,269 for July 2026. Adjusting this total for the variance and refund amounts yields gas costs to be recovered through the GCA factor of $144,076 for May 2026, $119,804 for June 2026, and $116,252 for July 2026. After dividing those amounts by the estimated sales, Petitioner's recommended GCA factors are $3.6568/Dth for May 2026, $3.8646/Dth for June 2026, and $4.0934/Dth for July 2026. Mr. Grosskopf testified there were errors in Petitioner's February 23, 2026 GCA 168 filing and the errors were corrected in Petitioner's March 6, 2026 revised filing. Mr. Grosskopf testified that the OUCC found nothing to indicate Petitioner has miscalculated the proposed GCA 168 factors in accordance with all applicable requirements. The Commission finds the above factors are properly calculated and should be approved, subject to refund in accordance with Paragraph 10 below.

5. Effects on Residential Customers - (GCA Cost Comparison). Petitioner requests
   authority to approve the GCA factor of $3.6568/Dth for May 2026, $3.8646/Dth for June 2026, and $4.0934/Dth for July 2026. The table below illustrates the commodity costs a residential customer will incur under the proposed GCA factor based on 10 Dth of usage. The table also compares the proposed gas costs to what a residential customer paid most recently (February 2026

• $6.1482/Dth) and a year ago (May 2025 - $3.6042/Dth, June 2025 - $4.1307/Dth, and July 2025
• $4.4163/Dth). The table reflects costs approved through the GCA process. It does not include

Petitioner's base rates or any applicable rate adjustment mechanisms. 3

Proposed Gas Costs Gas Costs Gas Costs

1. Interim Rates. We are unable to determine whether Petitioner will earn an excess
   return while these GCA factors are in effect. Accordingly, the rates approved in this Order are interim rates subject to refund pending reconciliation in the event an excess return is earned.

2. Monthly Flex Mechanism. The Commission has indicated in prior Orders that
   Indiana's gas utilities should make reasonable efforts to mitigate gas price volatility. The monthly flex mechanism is designed to address this concern. Petitioner has elected to utilize a monthly flex mechanism to adjust its GCA factor up to the cap of $2.00 on the total GCA factor monthly. Since Petitioner is utilizing a monthly flex mechanism, Petitioner must file a monthly flex tariff in the applicable GCA proceeding, including a notification of not flexing as warranted. The flex mechanism is to be filed no later than three business days before the beginning of each calendar month during the GCA period. IT IS THEREFORE ORDERED BY THE INDIANA UTILITY REGULATORY COMMISSION that:

3. The Petition of Community Natural Gas Co., Inc. for the gas cost adjustment for
   natural gas service, as set forth in Paragraph No. 8, is approved, subject to refund in accordance with Paragraph No. 10.

4. Petitioner shall file a monthly flex tariff under this Cause for approval by the
   Commission's Energy Division. Such rates shall be effective on or after the Order date subject to Division review and agreement with the amounts reflected.

5. This Order shall be effective on and after the date of its approval.
   ZAY, DEIG, SWINGER, AND VELETA CONCUR; ZIEGNER ABSENT: APPROVED: I hereby certify that the above is a true and correct copy of the Order as approved. ________________________________________ Dana Kosco Secretary of the Commission 4 Dana Kosco May 2026 June 2026 July 2026 ($2.66) ($3.23) $36.57 $38.65 $40.93 ($24.91) ($22.83) ($20.55) $0.53 $61.48 $36.04 $61.48 $41.31 $61.48 $44.16 Digitally signed by Dana Kosco APR 22 2026Difference (10 Dth) Difference (10 Dth) (10 Dth) Month Year Ago Current Date: 2026.04.22 10:20:05 -04'00'