Beginning on Sunday, Dec. 9, a large portion of The Empire District Electric Company service area in Missouri and Oklahoma suffered substantial damage as the result of a major winter storm system that brought sleet and freezing rain. Over the course of the three-day storm, approximately 65,000 customers, or nearly 40 percent of the company’s electric customer base, lost service. As of last night, the company expected service to be restored to all customers who were able to receive it.

Property damage and reconstruction costs are currently estimated at approximately $15 million. The allocation of costs associated with the storm is not yet finalized, but Empire expects a significant portion of those expenditures to be capitalized. The impact on earnings per share for the fourth quarter of 2007 is likely to be material. The recovery of these costs is an issue that will be addressed in future rate cases.