Tillsonburg Hydro Inc Presentation to OEB February 2004

Tillsonburg Hydro Inc. Presentation to OEB February 2004 Mark Renaud – Vice Chair – Tillsonburg Hydro Inc. Steve Lund – General Manager, Tillsonburg Hydro Inc. David Morris – CAO, Town of Tillsonburg

Introduction n n We share the OEB’s concern for reducing costs and improving efficiency We believe that LDC’s can operate efficiently at small customer sizes Safety must always be a #1 priority We need a stable operating environment to reduce costs & make further cost savings

Efficiency in all we do n n In 1999, the LDC and Town of Tillsonburg restructured & implemented a comprehensive master service agreement Technology, sourcing out, & use of best practices, & shared services has reduced costs The Town received a prestigious award re: use of technology & customer service delivery Our LDC costs are among the best in class for LDC’s of any size – benchmarking is important

Working to achieve OEB & Minister Duncan’s vision n Exciting developments with benign energy generation & new power plants are occurring in our backyard – we are working together to make this happen Upgrading assets to reduce energy use via 27. 6 kv conversions, & removing TS’s from the grid Collaboration: sharing services, contracting out work, outsourcing to keep FTE’s to a minimum

Shifting the paradigm n n We believe our LDC model works best, respecting the need to be financially responsible Municipal shareholder allows us to be financially strong Working beyond the distribution side to deliver value in “green energy” Smaller LDC’s can act as incubators for ideas & testing new concepts

Why our model works n n n Costs are more easily managed with contracted services Works in any customer size – you employ resources when & where you need them Leverage municipal strength & structure including engineering, IT, infrastructure, assets, rolling stock, etc. Cost savings have allowed us to improve our assets, customer service, & reduce energy consumption We meet or exceed those requirements as laid out by the OEB & work to achieve those ideas and concepts that the OEB and Minister Duncan have outlined

Summary recommendations n n n There is no right or wrong size for LDC’s Larger LDC’s do not necessarily result in lower costs per customer or act as innovators of service delivery or cost savings We have proven that smaller works while still being able to deliver “best in class” results with costs, customer service, safety, reliability; while working with new energy partners It is the business plan & relationship with our municipal shareholder that allows us to be progressive, accountable and results-oriented while being fiscally prudent We have proven that our LDC can work and meet your objectives with our customer size We want to continue to be a stand-alone LDC