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11/16/07 - OEB Announces New Transmission Rates Effective November 1, 2007

The Ontario Energy Board (OEB) has issued a Rate Order approving the Uniform Transmission Rates schedule for the recovery of the revenue requirements of all Ontario electricity transmitters. The new rates came into effect on November 1, 2007 and will remain in effect until December 31, 2008, after which they will be re-set.

The OEB approval reduces the Transmission rates by an average of approximately 12% over the next 14 months resulting in about a 1% decrease in an average customer’s total electricity bill. Transmission costs account for approximately 8% of the average total electricity bill.

The table below provides a comparison of the rates.

The Network and Line Connection rates are decreasing largely due to the impact of load growth on these assets. The Transformation Connection rate is increasing as a result of increased spending on transformation assets and the decrease in load growth due to an increase in customer owned stations.

The rate changes also reflect the repayment to customers over 14 months of over collection of revenues until the new rates came into effect, as well as the customer’s share of additional earnings in 2006. The OEB will reset Uniform Transmission rates on January 1st, 2009, at which time Hydro One expects its contribution to Uniform Transmission rates will increase to reflect the full repayment to customers of these amounts.

Hydro One’s capital and maintenance programs for 2007 and 2008 required to maintain a robust, safe and reliable transmission system were fully approved by the OEB. Hydro One will apply for its 2009 & 2010 revenue requirement in 2008, for use in determining new Uniform Transmission Rates effective for 2009.

Also note that the metering costs were removed from the Network rate and will now be charged separately for affected customers. For more information, see our Large Customer website at the link below: http://www.hydroonenetworks.com/en/customers/LDCs_and_Tx/communications/2007/09_21_07.asp

Full details about the rate change are available on the OEB website at: http://www.oeb.gov.on.ca/documents/cases/EB-2007-0759/Uniform_TX_Rates_Order_20071017.pdf.

If you have any questions, please contact your Account Executive.

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