Mark Renaud Vice Chair Tillsonburg Hydro Inc'

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Tillsonburg Hydro Inc.Presentation to
OEBFebruary 2004

• Mark Renaud Vice Chair Tillsonburg Hydro Inc.
• Steve Lund General Manager, Tillsonburg Hydro
  Inc.
• David Morris CAO, Town of Tillsonburg

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Introduction

• We share the OEBs concern for reducing costs and
  improving efficiency
• We believe that LDCs 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

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Efficiency in all we do

• In 1999, the LDC and Town of Tillsonburg
  re-structured 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
  LDCs of any size benchmarking is important

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Working to achieve OEB Minister Duncans vision

• 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 TSs from the grid
• Collaboration sharing services, contracting out
  work, outsourcing to keep FTEs to a minimum

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Shifting the paradigm

• 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 LDCs can act as incubators for ideas
  testing new concepts

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Why our model works

• 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

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Summary recommendations

• There is no right or wrong size for LDCs
• Larger LDCs 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