CH Energy Group Announces Second-Quarter Results

(Poughkeepsie, NY)  CH Energy Group, Inc. (NYSE: CHG) posted a loss of 9 cents per share during the second quarter of 2009, 20 cents per share lower than the same period last year when quarterly earnings were 11 cents. Earnings for the first half of 2009 totaled $1.37, 4 cents higher than the first six months of 2008.

“We had anticipated these results, given the inadequate revenues provided by the rate plan that expired on June 30, 2009,” said Chairman, President and Chief Executive Officer Steven V. Lant. “The rate increase approved by the New York State Public Service Commission that took effect July 1 for a 12-month period addressed this shortfall and will enable us to better recover the costs we incur to provide safe and reliable service to our customers while also providing a reasonable opportunity to earn an appropriate rate of return.”

Acknowledging that the recent rate order expires June 30, 2010, and the 11-month process required to propose and approve its replacement rate plan, Lant confirmed that the utility will tomorrow make the necessary regulatory filing to request that delivery rates be raised modestly to reflect increases in the costs of doing business.

Earnings by business unit were as follows:

Central Hudson Gas & Electric Corporation

The utility, which represents more than 85 percent of the Company’s assets, posted earnings of 6 cents during the second quarter, 19 cents lower than the prior year’s second quarter. “A 5-percent decline in weather-normalized sales and a 12-percent increase in the number of uncollectible accounts, both indicative of the weaker economy that prevailed during the period, as well as higher operating expenses, combined with other factors to depress quarterly earnings,” Lant explained. Year-to-date, Central Hudson has posted earnings of 84 cents, down from the 98 cents reported for the first half of 2008.

Griffith Energy Services

            “Griffith posted a loss of 14 cents during the quarter, a 3-cent improvement over the same period of 2008. This quarterly loss was expected due to the seasonality of Griffith’s fuel delivery business. More important is the cumulative earnings of 50 cents year to date, as compared to 20 cents earned by this business unit in the first six months of 2008 – an improvement of 150 percent,” Lant said. “Griffith’s management team has done an excellent job during a challenging period to improve margins and cost management.”

Other Businesses and Investments

            The remaining business units combined to post a loss of 1 cent during the quarter, and have produced a 3-cent contribution to earnings for the first half of the year (as compared to earnings of 3 cents during the second quarter and a 15-cent contribution in the first six months of 2008). “The single largest driver of this quarterly loss resulted from an equipment repair that necessitated taking our Lyonsdale Biomass facility off line for several weeks. The plant is back on line with an improved capacity factor as a result,” Lant explained.

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About CH Energy Group, Inc.
CH Energy Group, Inc. is a family of companies seizing new opportunities in the energy marketplace through two primary subsidiaries: Central Hudson Gas & Electric Corporation is a regulated transmission and distribution utility serving approximately 300,000 electric and about 74,000 natural gas customers in eight counties of New York State’s Mid-Hudson River Valley, and delivering natural gas and electricity in a 2,600-square-mile service territory that extends north from the suburbs of metropolitan New York City to the Capital District at Albany.  Central Hudson Enterprises Corporation, a non-regulated subsidiary, is the umbrella for a family of energy-related companies and investments focused primarily on fuel distribution and renewable energy.  Griffith Energy Service’s fuel distribution business supplies energy products and services to approximately 111,000 customers in 10 states, stretching from Rhode Island to the Washington, D.C. area.  CHEC also has interests in a Lexington, Neb., ethanol plant and several renewable energy projects in the Northeast.

Earnings Results Conference Call

Mr. Lant will conduct a conference call with investors to review financial results on Thursday, July 30, 2009, at 2:00 p.m. Eastern Time. The dial-in number for the call is 1-800-230-1766, and the conference name is “CH Energy Group.” The call will also be Webcast live in listen-only mode, and can be accessed in the Investor Relations section of CH Energy Group's website. Supplemental materials can be found here to assist participants in following the Conference Call presentation. A digitized replay of the call will be available from 4:30 p.m. Eastern Time on July 30, 2009, until 11:59 p.m. on August 6, 2009, by dialing 1-800-475-6701 and entering access code number 107171. The Webcast will also be available for replay after July 30 for approximately 30 days.

Forward-Looking Statements –
Statements included in this News Release and any documents incorporated by reference which are not historical in nature are intended to be, and are hereby identified as, “forward-looking statements” for purposes of the safe harbor provided by Section 21E of the Exchange Act.  Forward-looking statements may be identified by words including “anticipates,” “intends,” “estimates,” “believes,” “projects,” “expects,” “plans,” “assumes,” “seeks,” and similar expressions.  Forward-looking statements including, without limitation, those relating to CH Energy Group and its subsidiaries' future business prospects, revenues, proceeds, working capital, liquidity, income, and margins, are subject to certain risks and uncertainties that could cause actual results to differ materially from those indicated in the forward-looking statements, due to several important factors, including those identified from time-to-time in the forward-looking statements.  Those factors include, but are not limited to: weather; fuel prices; corn and ethanol prices; plant capacity factors; energy supply and demand; interest rates; potential future acquisitions; developments in the legislative, regulatory, and competitive environment; market risks; electric and natural gas industry restructuring and cost recovery; the ability to obtain adequate and timely rate relief; changes in fuel supply or costs including future market prices for energy, capacity, and ancillary services; the success of strategies to satisfy electricity, natural gas, fuel oil, and propane requirements; the outcome of pending litigation and certain environmental matters, particularly the status of inactive hazardous waste disposal sites and waste site remediation requirements; and certain presently unknown or unforeseen factors, including, but not limited to, acts of terrorism. CH Energy Group and its subsidiaries undertake no obligation to update publicly any forward-looking statements, whether as a result of new information, future events, or otherwise.   Given these uncertainties, undue reliance should not be placed on the forward-looking statements.