Hydro One Limited · TSX:H
Hydro One — HONI and First Nations Engagement Session Presentations
48 slides from Hydro One's investor presentation, Feb 9, 2017
Slide 1: Hydro One and First Nations Engagement Session
HYDRO ONE AND FIRST NATIONS ENGAGEMENT SESSION February 9th & 10th, 2017
Slide 2: Disclaimers
DISCLAIMERS In this presentation, all amounts are in Canadian dollars, unless otherwise indicated. Any graphs, tables or other information in this presentation demonstrating the historical performance of the Company or any other entity contained in this presentation are intended only to illustrate p
Slide 3: Thursday, February 9th 2017 - Agenda
Thursday, February 9th 2017 - Agenda Hydro One and First Nations Engagement Session Thursday, February 9, 2017 8:30 a.m. - 4:30 p.m. Session Objectives: We would like to come together to share mutual aspirations and hear from you about the issues that matter to your community. We will also be please
Slide 4: Friday, Feb 10th 2017 - Agenda
Friday, Feb 10th 2017 - Agenda Hydro One and First Nations Engagement Session Friday February 10, 2017 8:30 a.m. - 4:30 p.m. Session Objectives: We would like to come together to share mutual aspirations and hear from you about the issues that matter to your community. We will also be pleased to sha
Slide 5: Customer Service
CUSTOMER SERVICE Ferio Pugliese Executive Vice President, Customer Care and Corporate Affairs Hydro One and First Nations Engagement Session February 9 and 10, 2017 1
Slide 6: Customer Service Vision
Customer Service Vision We are easy to do business with We are there when customers need us We are always connected 2
Slide 7: We Are Easy To Do Business With
We Are Easy To Do Business With Education Advocacy Responsiveness 3
Slide 8: We Are There When Customers Need Us
We Are There When Customers Need Us In- Local presence Community Sessions First Nations Face-to-Face Province- Engagement Interactions Wide Responding in Program ways you prefer Enrollment 4
Slide 9: We Are Always Connected
We Are Always Connected eBill Notifications & High Usage Alerts New Website Redesigned Bill 5
Slide 10: Our Commitment to You
Our Commitment to You Be present where we can Listen and advocate on your behalf Partner and respond 6
Slide 11: First Nations Reliability Performance Overview
FIRST NATIONS RELIABILITY PERFORMANCE OVERVIEW Greg Kiraly and Mike Penstone Hydro One and First Nations Engagement Session February 9 & 10, 2017 1
Slide 12: Today's Presentation
Today’s Presentation • Customer Engagement Initiative • Reliability to First Nations Communities • Managing Costs 2
Slide 13: Customer Engagement Initiative
Customer Engagement Initiative • Occurred in Q2 2016 • A 3rd party facilitated the initiative • Input received from 300 First Nations Customers 3
Slide 14: Customer Engagement Results
Customer Engagement Results Focus of this presentation 34% 4
Slide 15: Customer Engagement Results Part 1
Customer Engagement Results Part 1: 34% 5
Slide 16: Generation to Customer
Generation Customer Distribution Lines - “Feeders” Generating Step-Up Transmission Step-down Distribution Customer Station Transformer Lines Transmission Stations (First Nation Stations Communities) Transmission System: ~490 Transmission Lines, ~340 Transmission Stations, 1 29,000 km of Transmissi
Slide 17: Transmission System
Transmission System Distribution Lines - “Feeders” Generating Step-Up Transmission Step-down Distribution Customer Station Transformer Lines Transmission Stations (First Nation Stations Communities) Transmission System: ~490 Transmission Lines, ~340 Transmission Stations, 1 29,000 km of Transmission
Slide 18: Tx System – Primary Causes of Interruptions
Tx System – Primary Causes of Interruptions: (~67% occurs from Weather & Equipment Failures) Power outage causes (2012-2016) Equipment failure 49% Majority of failures have occurred on Lines assets (Insulators, Wood Poles, Conductor, etc) Weather 18% Adverse weather (freezing rain, ice, lightning) O
Slide 19: First Nations: Transmission Connections
First Nations: Transmission Connections Northern Region (mostly Single-CCT) Southern Region (mostly Multi-CCT) 2015 Performance Trend Increasing duration of interruptions Increasing frequency of interruptions STABLE 9
Slide 20: Transmission Connections Performance: By Geographic Region
Transmission Connections Performance: By Geographic Region (First Nations Only) Transmission System - Northern Sub-System (2016 YE Performance) Tx Reliability # of Transmission Duration of Interruptions Frequency of Interruptions Index Connections (interruption minutes/ (# of interruptions Tx Connec
Slide 21: How is Hydro One maintaining Reliability in the Transmission System?
How is Hydro One maintaining Reliability in the Transmission System? • Increasing Capital Investments (Lines) • Leveraging Technology (Distance-to- Fault) • Reducing Planned Outages (Bundling Work) 11
Slide 22: Distribution System
Distribution System Distribution Lines - “Feeders” Generating Step-Up Transmission Step-down Distribution Customer Station Transformer Lines Transmission Stations (First Nation Stations Communities) Transmission System: ~490 Transmission Lines, ~340 Transmission Stations, 1 29,000 km of Transmission
Slide 23: Dx System – Primary Causes of Interruptions
Dx System – Primary Causes of Interruptions: (~50% occurs from Tree Contacts & Equipment Failures) Power outage causes (2013-2015) Tree damage 24% Trees fall on lines during storms. Poles, transformers, lines failures can cause Equipment failure 24% an outage. Unconfirmed causes 19% Sometimes Hydro
Slide 24: First Nations: Distribution Connections
First Nations: Distribution Connections Northern Region Southern Region 14
Slide 25: Dx Performance: By Customer Segmentation
Dx Performance: By Customer Segmentation (& First Nations Only) Distribution System - Overall (2016 YE Performance) Distribution System Interruption Hours/Customer # of Interruptions/Customer Reliability Index (SAIDI) (SAIFI) Hydro One 13.3 3.4 1First Nations 13.5 3.6 Note: Includes Force Majeure an
Slide 26: How is Hydro One maintaining Reliability in the Distribution System?
How is Hydro One maintaining Reliability in the Distribution System? Renewal program Replace equipment that’s affecting reliability Reducing the number of Tree trimming outages per Targeting tree trimming in areas year with high tree contacts Smart Grid Adding more protective devices & remote contro
Slide 27: Customer Engagement Results Part 2
Customer Engagement Results Part 2: 17
Slide 28: Controlling Costs
Controlling Costs: • Pacing Expenditures • Vegetation Management • Move-to-Mobile 18
Slide 29: Questions & Answers
Questions & Answers 19
Slide 30: Hydro One's Distribution Rates Application (2018-2022)
HYDRO ONE’S DISTRIBUTION RATES APPLICATION (2018-2022) Oded Hubert Vice President – Regulatory Affairs Hydro One and First Nations Engagement Session February 9 and 10, 2017 1
Slide 31: Hydro One Limited (Hydro One)
Hydro One Limited (Hydro One) Hydro One is Ontario’s largest electricity delivery company We are owned 70% by the province of Ontario and 30% by public shareholders We have three businesses: Transmission; Distribution; and Telecommunications 2
Slide 32: Hydro One's Role in the Ontario Electricity System
Hydro One’s Role in the Ontario Electricity System Transmission Distribution Transmission Distribution Industrial, Generation System System Residential, Commercial 3
Slide 33: Distribution System Map
Distribution System Map bak e hydrg Electric Distribution Territory Legend Northern Ontario
Slide 34: Distribution System Stats
Distribution System Stats Rural Service Area - 960,123 sq. km Service Territory Urban Service Area - 677 sq. km 1.3 million residential and business customers as Customers well as 55 local distribution companies Approximately 13,400 small, mid-size and large embedded generators connected to Hydro On
Slide 35: Breakdown of Electricity Costs to Customers
Breakdown of Electricity Costs to Customers Regulatory Sales Tax 5% Charges 3% Line Losses 4% Hydro One’s Portion of Local Electric Total Electric Bill Customer Electric Bill Distribution Charges Generation Related Charges Transmission Charges 6
Slide 36: How Distribution Charges are Spent by Hydro One
How Distribution Charges are Spent by Hydro One • Hydro One receives a distribution charge which pays for a broad range of distribution system costs: 7
Slide 37: How Distribution Rates are Set
How Distribution Rates are Set Electricity distribution rates are set by the Ontario Energy Board (OEB), an independent public agency. The OEB sets rates following a public hearing based on evidence. Hydro One will be applying to the OEB to set our distribution rates for the period 2018-2022 i
Slide 38: Objectives of the OEB
Objectives of the OEB 1. Protect the interests of consumers 2. Promote economic efficiency and cost effectiveness… maintain a financially viable electricity industry 3. Promote conservation & demand management 4. Facilitate the smart grid 5. Promote generation from renewable energy sources: • consis
Slide 39: Stages of an Application
Stages of an Application 3-4 months Preliminary Matters 2-3 months Issues & Discovery 2-4 weeks Hearing 2-4 months Decision & Approval Usually takes 8 – 12 months 10
Slide 40: Balancing Key Considerations
Balancing Key Considerations Rate Impact Asset Customer Needs Needs & Preferences 11
Slide 41: Hydro One's Application
Hydro One’s Application Our proposal is focused on addressing customer needs and preferences including: • Keeping Costs Low Keep costs as low as possible is customers’ top priority • Maintain Reliable Service Maintaining reliable electricity service is consistently second priority to cost • Large Cu
Slide 42: Service Enhancements Hydro One Will Deliver
Service Enhancements Hydro One Will Deliver Hydro One’s overall business plan was optimized such that asset condition and reliability will not deteriorate 13
Slide 43: Proposed Distribution Rate Increases And Total Bill Impact
Proposed Distribution Rate Increases And Total Bill Impact 14
Slide 44: Main Areas of Hydro One Rate Increases
Main Areas of Hydro One Rate Increases Cost Drivers 2018 2019 2020 2021 2022 Operations, Maintenance and -0.1% 0.5% 0.5% 1.2% 0.5% Administration Capital Related (e.g., poles, wires 2.0% 2.9% 2.6% 3.3% 2.5% and transformers) Taxes 0.7% 0.2% 0.1% 0.4% 0.1% Load Impact 2.0% -0.2% -0.7% -2.5% -0.6% Oth
Slide 45: Additional Cost from Declining Electricity Use (Load Impact)
Additional Cost from Declining Electricity Use (Load Impact) The cost of distribution services is spread out among all Hydro One customers based on total electricity consumption. Total electricity consumption has been decreasing since rates were last set, so the cost of serving each individual c
Slide 46: On-Reserve First Nations Electricity Customers
On-Reserve First Nations Electricity Customers Minister of Energy asked the OEB to examine and provide advice for an appropriate electricity rate or rate assistance program Hydro One has been supportive of this initiative and has provided input to the OEB January 1, 2017 OEB submitted its repo
Slide 47: Questions & Answers
Questions & Answers 18
Slide 48: Thank You for Attending!
THANK YOU FOR ATTENDING! 19
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