Central Hudson Energy Services Acquires Five Oil and Propane Fuel Distributorships; Acquisitions Increase CHES's Customer Base by 25 Percent.

Business and Energy Editors

POUGHKEEPSIE, N.Y.--(BUSINESS WIRE)--Dec. 13, 2001

With the recent acquisition of five established energy firms, Central Hudson Energy Services, Inc. -- the competitive energy services branch of CH Energy Group Inc. -- now serves more than 75,000 homes and businesses from Massachusetts to West Virginia with a variety of energy products and services.

The acquired firms are located in West Virginia, Delaware, Pennsylvania and Maryland and supply both fuel oil and propane.

The acquisitions are part of CHES's continuing program to build a platform for selling energy products and services throughout the Northeast and Mid-Atlantic region, and complement its long-term strategy to grow through the purchase of existing energy businesses that make immediate contributions to earnings.

"We're especially pleased that the five companies, which together serve more than 16,000 customers, have established standards of excellence that are consistent with our commitment to superior customer service," said Allan R. Page, President of CHES. "Tucked into the footprint of our existing holdings, these operations are a natural fit for us, and offer us not only operational synergies, but also great potential to cross sell other energy products and services in the region. And, we anticipate the firms will make immediate contributions to our earnings."

The five companies, which will be managed through the 10,000-square-mile territory of CHES subsidiary Griffith Energy Services (based in Cheverly, Maryland), are:

    --  Consumers Fuel Company, Inc. of Martinburg, West Virginia;

    --  R.S. Leitch Company and subsidiaries, of Edgewater, Maryland;

    --  McMahan Oil Company, based in Easton, Maryland;

    --  Staats Gas, Inc., located in Smyrna, Delaware; and

    --  Walker Oil Company, of Nottingham, Pennsylvania.

"We welcome the employees of these firms into our family of companies, especially because of the important entrepreneurial skill set they bring to our operations," Page said.

Through its various subsidiary holdings, CHES also serves retail heating oil, electric natural gas and propane customers in Connecticut, Massachusetts and New York. In all, the competitive energy products and services firm serves customers in 11 states with electricity, heating oil, motor fuels, natural gas and propane, in addition to value-added energy services. CHES is a subsidiary of CH Energy Group, Inc., which also includes Central Hudson Gas & Electric Corporation, a regulated electric and natural gas utility serving approximately 625,000 people in a 2,600-square-mile service territory in the Mid-Hudson Valley region of New York State.

Statements included in this press release 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 Securities Exchange Act of 1934, as amended by Public Law 104-67, and within the meaning of the Securities Litigation Reform Act of 1995. Forward-looking statements may be identified by words including "anticipate," "believe," "intends," "estimates," "expect," and similar expressions. The Company cautions readers that forward-looking statements, including without limitation, those relating to the Company's 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 Company's reports filed with the SEC. All forward-looking statements are intended to be subject to the safe harbor protections provided by the laws mentioned above. A number of important factors affecting the Company's business and financial results could cause actual results to differ materially from those stated in the forward-looking statements. Those factors include weather, energy supply and demand, developments in the legislative, regulatory and competitive environment, electric and gas industry restructuring and cost recovery, future market prices for energy, capacity and ancillary services, nuclear industry regulation, the outcome of pending litigation, and certain environmental matters, particularly ongoing development of air quality regulations and industrial waste remediation requirements.