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Steve Baker President

Natural Gas in Ontario’s Energy Mix Seeing The Bigger Picture. Steve Baker President. Union Gas – A Spectra Energy Company. Industry Economic Contributions Total Ontario natural gas customers = 3.4 million Ontario natural gas utilities employment = 4,300

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Steve Baker President

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  1. Natural Gas in Ontario’s Energy Mix Seeing The Bigger Picture Steve Baker President

  2. Union Gas – A Spectra Energy Company • Industry Economic Contributions • Total Ontario natural gas customers = 3.4 million • Ontario natural gas utilities employment = 4,300 • Canadian natural gas sector employment = 172,000 (Canada 2010) • Ontario capital investment = $750 million to $1 billion annually • Taxes paid by Ontario gas utilities = $298 million in 2011 (Municipal, Prov., Fed.) Robust natural gas infrastructure

  3. Waterloo/Brantford District Distribution Area: From Port Rowan, in the south, to Wiarton in the north. Pipelines: 8,400 kilometres Customers: 263,350 Property Tax Paid: $10.6M in 2012 District Offices: Waterloo, Guelph, Cambridge, Brantford, Simcoe, Hanover, Owen Sound Union Gas Employees: Waterloo/Brantford District – 143 Brantford Call Centre – 127

  4. Ontario’s Primary Energy Mix (TJ/%) Total Coal 15622 1% Industrial Percentage of customers: 1% Annual throughput: 45% Commercial Percentage of customers: 7% Annual throughput: 21% Power Generation Plants: 59% (2/3 of Industrial Consumption) Residential Percentage of customers: 92% Annual throughput: 34% Natural Gas 775711 32% Total refined petroleum products 994614 41% Natural Gas 775711 32% Gas plant natural gas liquids (NGL's) 40798 2% Coke oven gas 21933 1% Coke 75815 3% Primary electricity, hydro and nuclear 471987 20% Steam 3120 0% Natural gas: a critical fuel for Ontario 4

  5. Ontario Power Mix 2012 Installed Capacity Generation by Fuel Type Other 0.3% Wind 4.2 Coal 3% Other 1% Wind 3% Hydro 22.2% Natural Gas 15% Nuclear 36.2% Nuclear 56% Coal 9.2% Hydro 22% Natural gas: a key contributor to energy mix Natural Gas 27.9%

  6. Electricity Generation from Neighbouring States

  7. Natural Gas Meeting Peak Day Demand

  8. Ontario’s Electricity Rates & Surrounding Provinces/States (Based on average residential and industrial consumption HOEP + global adjustment) Ontario’s electricity rates must be competitive

  9. Ontario’s Total Residential Bill Prices (“Ontario Average Electricity” is the average price of all electricity distributors across Ontario as reported by Statistics Canada; HST and Ontario Clean Energy Benefit are not included) As energy costs escalate, natural gas remains affordable

  10. Natural Gas - Conservation Success Union Gas conservation programs saved customers $1.4 billion in costs (2007-2011)

  11. North American Market Dynamics BC Growth Western Canada Decline 2-3 PJ/d Marcellus/ Utica Growth 8 PJ/d Midcontinent Growth 1-2 PJ/d Gulf Coast Growth 1-2 PJ/d Ontario’s robust infrastructure has a competitive advantage

  12. Diversifying Ontario’s Natural Gas & Infrastructure Supply • New proposed infrastructure will move more supply to Ontario

  13. Opportunities for Ontario • Natural gas prices in Canada have been on a steady decline since mid-2008 due to increasing supply and economic trends • Residential savings of $275-$400/year due to new shale supplies • Commercial customer savings of $9,000-$15,000/year • Industrial customer savings of $10-20 million/year • $3-5 billion/year in savings to Ontario consumers

  14. Opportunities for Ontario Connecting New Communities – rural & remote Power Generation – greater role in fuel mix Natural Gas for Transportation – heavy duty return-to-base vehicles Industrial – retain and attract energy intensive industry (steel/petrochemical/fertilizer) Northern Ontario – mining opportunities

  15. How Energy Industry, Government and Regulators Can Help • Get the word out about opportunities related to natural gas • Create efficiency& certainty around energy policy& regulation

  16. Natural Gas in Ontario’s Energy Mix – Seeing The Bigger Picture www.uniongas.comwww.cleanandaffordable.ca Thank you

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