NECPUC Symposium June 11, 2013

1. NECPUC SymposiumJune 11, 2013

2. NU Safe Harbor Provisions • This presentation includes statements concerning NU’s expectations, beliefs, plans, objectives, goals, strategies, assumptions of future events, future financial performance or growth and other statements that are not historical facts. These statements are “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. In some cases, a listener or reader can identify these forward-looking statements through the use of words or phrases such as “estimate,” “expect,” “anticipate,” “intend,” “plan,” “project,” “believe,” “forecast,” “should,” “could,” and other similar expressions. Forward-looking statements involve risks and uncertainties that may cause actual results or outcomes to differ materially from those included in the forward-looking statements. Factors that may cause actual results to differ materially from those included in the forward-looking statements, include, but are not limited to the possibility that expected merger synergies will not be realized or will not be realized within the expected time period; cyber breaches, acts of war or terrorism, or grid disturbances; actions or inaction of local, state and federal regulatory and taxing bodies; changes in business and economic conditions, including their impact on interest rates, bad debt expense and demand for NU’s products and services; changes in weather patterns; changes in laws, regulations or regulatory policy; changes in levels or timing of capital expenditures; disruptions in the capital markets or other events that make NU’s access to necessary capital more difficult or costly; developments in legal or public policy doctrines; technological developments; changes in accounting standards and financial reporting regulations; actions of rating agencies; and other presently unknown or unforeseen factors. Other risk factors are detailed from time to time in NU’s and NSTAR’s reports filed with the Securities and Exchange Commission. Any forward-looking statement speaks only as of the date on which such statement is made, and NU undertakes no obligation to update the information contained in any forward-looking statements to reflect developments or circumstances occurring after the statement is made or to reflect the occurrence of unanticipated events. • All per share amounts in this presentation are reported on a diluted basis. The only common equity securities that are publicly traded are common shares of NU parent. The earnings per share (EPS) of each business do not represent a direct legal interest in the assets and liabilities allocated to such business, but rather represent a direct interest in NU's assets and liabilities as a whole. EPS by business is a non-GAAP (not determined using generally accepted accounting principles) measure that is calculated by dividing the net income or loss attributable to controlling interests of each business by the weighted average diluted NU parent common shares outstanding for the period. In addition, recurring EPS exclude certain charges related to the April 10, 2012 closing of the merger between NU and NSTAR are non-GAAP financial measures. Management uses these non-GAAP financial measures to evaluate earnings results and to provide details of earnings results by business and to more fully compare and explain NU’s results without including the impact of the non-recurring merger and related settlement costs. Management believes that these non-GAAP financial measures are useful to investors to evaluate the actual and projected financial performance and contribution of NU’s businesses. Non-GAAP financial measures should not be considered as alternatives to NU consolidated net income attributable to controlling interests or EPS determined in accordance with GAAP as indicators of NU’s operating performance. 2

3. Why NOW is OUR Time • Abundant domestic supplies… • Marcellus Shale is a “game changer” with enormous potential for the region: • … leading to forecast low prices • Oil and natural gas prices have diverged to an unprecedented degree ACTUAL FORECAST $/MMBtu

4. NU Gas Business – At a Glance

5. NU Gas Business – Distribution System Challenges/Growth Opportunities • Cast Iron/Bare Steel Replacement Program - Distribution Integrity Management Program (DIMP) Massachusetts • Program is substantial - $20 million per year • Look to accelerate to faster track (20 years) in next rate case Connecticut • Bare steel/cast iron replacement program received regulatory approval in 2011 rate decision- $40 million per year • 20 year program to replace all bare steel/cast iron • Growth Opportunities Massachusetts • Moderate growth in short term with greater potential • Working with policymakers to adopt natural gas growth strategy for MA Connecticut - Comprehensive Energy Strategy (CES) • Substantial opportunity for expansion • Seeking necessary tools to achieve growth objectives of CES

6. Meeting the Challenges of Distribution Integrity and Growth Opportunitiesand Distribution Integrity • Yankee’s operations and maintenance program meets or exceeds all federal and state requirements. • Subject to regulatory approval, the Company has a plan to eliminate the leak prone cast iron and bare steel pipe in its system. • Yankee’s management team is actively involved in regional and national organizations that are promoting new safety policies/procedures for the industry.

7. Industry Incident Trend – 1986 - 2010 The Pipeline and Hazardous Materials Administration (PHMSA) reports that over the past 25 years, pipeline incidents involving death or major injury have decreased on average 10% every three years.

8. The Opportunity…. Job Creation Environmental Benefits Economic Impact Residential Customer Savings Business Competitiveness Energy Independence

9. NU Gas Business – Growth Potential CT & MA residential gas heating penetration vs. nearby states CT Residential Market Penetration by Heating Source US Average = 7% NJ NY RI MA CT Heating Oil #2 Natural Gas Electric Heating Propane Sources: SNL; Energy Information Administration State Energy Data System (SEDS); Northeast Gas Association

10. CT Comprehensive Energy Strategy (CES) … Positive Economic and Environmental Impacts CT’s Department of Economic and Community Development quantified the significant net economic benefits to Connecticut of a high growth gas expansion scenario. 5,400 net jobs per year supported by expansion over 10 years Job creation $4.1 billion of increased net GDP over the expansion period Economic impact $465 million/year injected into CT’s economy once program is in place Customer savings 0.9 million tons of green house gas emissions reduction per year Environmental benefits Source: Economic analysis performed by Department of Economic and Community Development in 2011

11. Summary of CT CES With Respectto Gas Growth • Planning • Establish planning process for natural gas expansion. • Marketing • Raise customer awareness through marketing. • Incentives • Implement financing mechanisms to make fuel switching affordable. • Provide incentives to drive aggregation of new off-main customers. • Provide incentives to encourage installation of high-efficiency furnaces. • Reduce costs of equipment conversion and main extension. • Regulatory • Change hurdle rate calculation to reduce upfront customer charge for main extensions. (25 years) • Allow an alternative rate rider for new customers to pay customer main extension costs. • Allow greater flexibility when calculating customers’ main expansion costs. • Establish a mechanism for timely recovery of capital expenditures made by gas companies.

12. While Benefits are Clear, Hurdles Still Exist Ensuring Safety/Reliability and Meeting customer expectations Regulator Approvals Regulatory model Customer impacts Pipeline capacity Securing capacity to support growth

13. Regional Market Conditions: Lack of pipeline capacity driving increased prices volatility

14. Extension PoliciesMany utilities have multiple requirements and used more than one method • 2012 Survey – Preliminary Results • 95 reporting jurisdictions • - Approximately 53% offer free main or services • - Approximately 33% require a minimum return on investment • - Approximately 52% require a simple revenue test • - Approximately 29% have alternate extension policies, and • - 15 (16%) reported using special methods such as tax • abatements and other government subsidies, economic • development programs, grants, area surcharges, and • offsets for substituting a cleaner fuel • - All require non-traditional ratemaking to accelerate • distribution expansion and meet customer demand

15. CNG Vehicles • CNG fuel prices are substantially separated from gasoline prices • Environmental benefits to CNG vehicles are clear • Two types of vehicles offer distinct advantages: • Light-duty vehicles with predictable driving patterns • Heavy haul vehicles with high fuel use • Opportunities exist to define the short- and long-term utility role: • Leadership vs. support • Rate base recovery essential • Challenges need to be overcome • We propose a pilot that benefits all stakeholders