Peoples Gas Seeks Rate Increase

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If Approved, New Rates Would Not Take Effect Until 2015

Chicago, IL - Peoples Gas announced today that the company is seeking an increase in the amount it charges to deliver natural gas to customers. If approved, the proposed rate increase would be about $5.00 a month on average for typical residential heating customers, and would not take effect until next year. The proposed rate adjustment filed with the Illinois Commerce Commission is the first step in an 11-month regulatory review process.

"The harsh Chicago winter we're experiencing has demonstrated the need to continually ensure our natural gas delivery system is resilient, safe and reliable," said Will Evans, Jr., president of Peoples Gas. "We are committed to investing in modernizing the system and maintaining a strong workforce to provide our customers with natural gas service they can count on. Replacing and maintaining the infrastructure now will also result in cost savings and benefits for customers over time."

Last week, Peoples Gas announced its plan to invest more than $300 million in construction projects this year. Peoples Gas has been steadily increasing its financial investment in infrastructure projects over the past six years to improve the safety and reliability of the natural gas distribution system in Chicago. In 2011, Peoples Gas embarked on an ambitious plan designed to expedite the prudent enhancement of Chicago's natural gas infrastructure. The program will eradicate higher-risk materials and upgrade the pressure of Chicago's gas distribution system. This coincides with a national call to action from the Pipeline and Hazardous Materials Safety Administration (PHMSA) to prioritize enhancements of the nation's aging natural gas pipelines.

Peoples Gas is also advising customers that the price per therm for natural gas for the month of March is likely to be 80% higher than February. Prolonged sub-zero temperatures have resulted in the coldest Chicago winter in 35 years, with temperatures 17% colder from November 1, 2013 through February 2014 when compared to the same timeframe in the prior year. This colder-than-average weather has resulted in customers using about 26% more natural gas compared to last year. The Gas Charge for March is expected to be around 93 cents. This charge includes the actual purchase cost, transportation and storage of natural gas, which can vary month to month, but is passed through to customers with no markup. Peoples Gas will work closely with customers who would like financial assistance to pay bills over time, including payment plan options and financial grant information. Customers in need of help should contact Peoples Gas on 866-556-6001 or visit http://www.peoplesgasdelivery.com.

The company said it would continue its long history of working with community organizations, elected officials and others to help low- and fixed-income residents meet their energy needs. The utility works closely with Community Economic Development Association (CEDA) to deliver the Peoples Gas Share the Warmth program, which provides matching grants to at-risk customers. Share the Warmth has provided more than $10.5 million in heating assistance grants to thousands of residents over the past 13 years.

Peoples Gas also offers free products and services that help to educate customers about energy efficiency and conservation to better manage and lower their energy usage. Since the Peoples Gas Natural Gas Savings Program began in June 2011, the company has issued more than $19 million in rebates to save nearly 13.8 million net therms of natural gas. That equates to the energy usage for more than 3,600 homes for a year. It also eliminates close to 73,000 metric tons of CO2 emissions in Chicago - that's like taking about 15,200 cars off the road annually.

Peoples Gas, a subsidiary of Integrys Energy Group, Inc. (NYSE: TEG ), a regulated natural gas delivery company that serves approximately 829,000 residential, commercial and industrial customers in the city of Chicago. For more information about Peoples Gas, visit the company’s website: www.peoplesgasdelivery.com.

Forward-Looking Statements:

This news release contains forward-looking statements within the meaning of Section 21E of the Securities Exchange Act of 1934. You can identify these statements by the fact that they do not relate strictly to historical or current facts and often include words such as "anticipate," "expect," "intend," and other similar words.

Forward-looking statements are beyond the ability of Integrys Energy Group to control and, in many cases, we cannot predict what factors would cause actual results to differ materially from those indicated by forward-looking statements. Please see Integrys Energy Group's periodic reports filed with the Securities and Exchange Commission (including its 10-K and 10-Qs) for a listing of certain factors that could cause actual results to differ materially from those contained in forward-looking statements.

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