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CONTACT: Steve Kraus
133 S. Blair St.
Madison, WI 53701-1231
(608) 252-7907

MGE Energy Declares Regular Dividend

Madison, Wis., May 23, 2006—The board of directors of MGE Energy, Inc. (Nasdaq: MGEE) today declared the regular quarterly dividend of $0.3450 per share on the outstanding shares of the company's common stock, payable June 15, 2006, to shareholders of record at the close of business June 1, 2006.

MGE Energy has increased dividends annually for the past 30 years and has paid cash dividends each year since 1909.

MGE Energy is a public utility holding company. Its principal subsidiary, Madison Gas and Electric (MGE), generates and distributes electricity to nearly 136,000 customers in Dane County and purchases and distributes natural gas to nearly 137,000 customers in seven south-central and western Wisconsin counties. MGE has served the Madison area since 1896.