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Filed pursuant to Rule 433

Registration No. 333-135401

December 22, 2006


Madison Gas and Electric Company


Pricing Term Sheet


Issuer:

Madison Gas and Electric Company

Title of Securities:

5.25% Medium-Term Notes due 2017

Legal Format:

SEC-registered (Registration No. 333-135401)

Size:

$30,000,000

Maturity:

January 15, 2017

Coupon:

5.25%

Issue Price:

99.727% of principal amount

Yield to Maturity:

5.285%

Spread to Benchmark Treasury:

+ 70 basis points (0.700%)

Benchmark Treasury:

4.625% due November 15, 2016

Benchmark Treasury Yield:

4.585%

Interest Payment Dates:

January 15 and July 15, commencing July 15, 2007

Redemption Provisions:

 

Make-whole call

At any time at a discount rate of Treasury rate plus 15 basis points

Settlement:

December 29, 2006 (T+4)

CUSIP:

557497AQ7

Ratings:

Aa3 (Moody’s);
AA- (S&P)


The issuer has filed a registration statement (including a prospectus) with the SEC for the offering to which this communication relates.  Before you invest, you should read the prospectus in that registration statement and other documents the issuer has filed with the SEC for more complete information about the issuer and this offering.  You may get these documents for free by visiting EDGAR on the SEC Web site at www.sec.gov.  Alternatively, the issuer, the underwriter or any dealer participating in the offering will arrange to send you the prospectus if you request it by calling JPMorgan collect at 212-834-4533.