DR 98-049
                         Northern Utilities, Inc.
                 Recovery of Environmental Response Costs
                    Order Approving Procedural Schedule
                         O R D E R   N O.  22,962
                               June 23, 1998

         APPEARANCES: LeBoeuf, Lamb, Greene & MacRae by Paul B.
     Dexter, Esq. and Meabh Purcell, Esq. for Northern Utilities, Inc.
     and Michelle A. Caraway and Stephen P. Frink for the Staff of the
     New Hampshire Public Utilities Commission.
               On April 13, 1998, Northern Utilities, Inc. (Northern)
     filed with the New Hampshire Public Utilities Commission
     (Commission) a Petition for Approval of an ERC Rate Adjustment
     Tariff establishing a mechanism for recovery of Northern's
     Environmental Response Costs (ERCs) and other related tariff
     changes.  ERCs are incurred in the assessment, remediation and
     monitoring of Northern's former manufactured gas plants (MGP) in
     New Hampshire.
               Pursuant to federal and state environmental laws,
     Northern is required to investigate and remediate the sites of
     former MGPs in Rochester and Exeter, New Hampshire, owned and/or
     operated by Northern's predecessors, on which hazardous materials
     from the MGP operations have been found.  The proposed recovery
     mechanism is designed to recover actual annual ERC expenditures
     including carrying costs over a five year period, plus one-half
     of related insurance and third-party expenses and less one-half
     of related insurance and third-party recoveries.
               On May 11, 1998, the Commission issued an Order of
     Notice which scheduled a Prehearing Conference for June 10, 1998. 
     The Order of Notice also set deadlines for intervention requests
     and objections thereto, outlined a proposed procedural schedule,
     and required the Parties and Staff to summarize their positions
     with regard to the filing for the record.  There were no Motions
     to Intervene filed.  The Office of the Consumer Advocate (OCA) is
     a statutorily recognized intervenor.
               After the Prehearing Conference, Northern and Staff
     agreed to modify the proposed procedural schedule as outlined in
     the Order of Notice.  On June 16, 1998, Staff notified the
     Commission of the various revisions to the procedural schedule
     agreed to by Northern and Staff and also stated that the
     concurrence of the OCA had been obtained.  The revised procedural
     schedule is as follows:
          Responses to Oral Data Requests          June 24, 1998 
             Propounded at the 1st
             Technical Session
          Data Requests by Staff and                July 8, 1998 
          Company Data Responses                   July 17, 1998 
          Technical Session                        July 29, 1998 
          Testimony by Staff and                 August 12, 1998 
          Data Requests by the Company           August 26, 1998 
          Data Responses by Staff and          September 9, 1998 
          Settlement Conference               September 23, 1998 
          Filing of Settlement Agreement,     September 30, 1998 
             if any
          Hearings                               October 7, 1998 
     & October 8, 1998.            
               In accordance with the Order of Notice, Northern and
     Staff stated their issues with regard to the filing for the
     record.  Northern stated that the April 10, 1998 filing was quite
     thorough and indicated that Northern was seeking approval of a
     rate adjustment related to the recovery of costs associated with
     remediating former MGPs.  The issues pertain primarily to the
     cleanup of the sites and the collection of the related costs.
               Staff stated that its issues relate to whether and to
     what extent remediation costs relating to the former MGPs should
     be borne by utility shareholders or passed along to ratepayers;
     whether the MGPs' operations were prudent; whether Northern acted
     prudently and incurred reasonable costs in responding to,
     investigating and remediating MGP contamination; and what the
     appropriate rate scheme is to recover any Commission authorized
     pass-through to ratepayers.
               The OCA was not present at the Prehearing Conference.
               We find the proposed procedural schedule to be
     reasonable and will, therefore, approve it for the duration of
     the proceeding.     
               Based upon the foregoing, it is hereby 
               ORDERED, that the procedural schedule delineated above
     is APPROVED.
               By order of the Public Utilities Commission of New
     Hampshire this twenty-third day of June, 1998.
        Douglas L. Patch    Bruce B. Ellsworth        Susan S. Geiger
            Chairman           Commissioner            Commissioner
     Attested by:
     Claire D. DiCicco
     Assistant Secretary