DISTRIBUTION SALES FIREROCK CUSTOMER MEETING - UNION GAS

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DISTRIBUTION SALES FIREROCK CUSTOMER MEETING - UNION GAS
Distribution Sales
FireRock Customer Meeting

                       May 23, 2019
DISTRIBUTION SALES FIREROCK CUSTOMER MEETING - UNION GAS
Safety Message

Golf Injuries: Play it safe with these tips!
DISTRIBUTION SALES FIREROCK CUSTOMER MEETING - UNION GAS
Warm-Up

    • Before you practice your swing or play a round of golf,
      warm up for at least 10 minutes with a brisk walk or a set
      of jumping jacks
    • Stretch your hands, wrists, forearms, elbows, shoulders,
      spine and pelvis
    • Swing your golf club a few times, gradually increasing
      your range of motion

    “It's all in the hips. It's all in the hips. It's all in the hips.” — Chubbs - Happy Gilmore
DISTRIBUTION SALES FIREROCK CUSTOMER MEETING - UNION GAS
Adjust Your Swing

     • The entire body is used to execute a golf swing in a
       complex and coordinated movement
     • When this movement is repeated frequently, significant
       stress is placed on the same muscles, tendons and joints
     • Remember to:
          • Use proper posture
          • Stay smooth
          • Don't over-swing

     "I don't think the heavy stuff is coming for a while" - Caddyshack
DISTRIBUTION SALES FIREROCK CUSTOMER MEETING - UNION GAS
Strengthen Your Muscles

     • You don't need bulging muscles to hit a long drive — but the
       stronger your muscles, the greater your club speed
     • Stronger muscles are also less prone to injury. For best results,
       do strength training exercises year-round

      "Somebody's closer." - Happy Gilmore
DISTRIBUTION SALES FIREROCK CUSTOMER MEETING - UNION GAS
Focus on Flexibility

     • Regular stretching can improve your range of motion and lead
       to a more fluid golf swing

      "Just tap it in. Just tap it in. Give it a little tappy. Tap Tap Taparoo.” — Happy Gilmore
DISTRIBUTION SALES FIREROCK CUSTOMER MEETING - UNION GAS
Build up Your Endurance

     • Regular aerobic activity can give you staying power on the
       course
     • Try walking, jogging, bicycling or swimming

     "Do you want a piece of me poppy." (Happy Gilmour) "No I want the whole thing." (Bob Barker) - Happy Gilmore
DISTRIBUTION SALES FIREROCK CUSTOMER MEETING - UNION GAS
Lift and Carry Clubs Carefully

     • Golfers who carry their own bags have higher rates of shoulder
       and back injuries than do other golfers
     • If you jerk heavy clubs out of the trunk of your car, you could
       injure yourself before you reach the first tee
     • Use proper lifting technique: Keep your back straight and use
       the strength of your legs to lift

      “The most important shot in golf is the next one.” – Ben Hogan
DISTRIBUTION SALES FIREROCK CUSTOMER MEETING - UNION GAS
Try to Avoid Hitting Objects Other Than the Ball

     • Elbow and wrist injuries are often the result of hitting the ground
       or the rough

      "You can talk to a fade but a hook won't listen.“ – Lee Trevino
DISTRIBUTION SALES FIREROCK CUSTOMER MEETING - UNION GAS
Watch out for Hazards on the Course

 • Watch for signs and symptoms of dehydration, heat exhaustion and heatstroke.
 • Drink plenty of water, whether you feel thirsty or not, and cut your game short if
   necessary
 • Be careful to limit your sun exposure while golfing

 Remember to:
 • Use sunscreen
 • Wear sunglasses to filter out UVA and UVB rays
 • Wear a hat with a visor to shade your eyes and face

 “Why you don't you just go HOME? That's your HOME! Are you too good for your HOME? ANSWER ME!” — Happy Gilmore
Choose Proper Footwear

 • Dress for comfort and protection from the elements
 • Wear golf shoes with short cleats
 • Long cleats dig into the sod and hold your feet planted as you swing, which
   may strain your knees or ankles

 “If I had it to do all over again, I'd still hit that shot” - Tin Cup
Thank you, play safe and have fun ☺

"Cinderella story. Outta nowhere. A former green-skeeper, now, about to become the Masters champion. It looks like a miracle... It's
                in the hole! It's in the hole! It's in the hole" - Asst. greens-keeper Carl Spackler from...well, you know.
Corporate Update

                             Tanya Mushynski
              Vice President, Customer Care
Enbridge: Life Takes Energy
Our purpose & values

                         We exist to help fuel people’s quality of
                         life.

                         We are guided by our values of Integrity,
                         Safety & Respect.
Enbridge Assets
What we do
We help to fuel to the quality life for millions of people everyday by
connecting them with the energy they need

 Liquids Pipelines               Natural Gas Pipelines              Gas Distribution                Renewable Power

• 27,415 kilometers of crude   • 41,850 kilometers of natural   • 12 million customers            • 1,700 net megawatts of
  & liquids pipelines            gas pipelines                                                      generating capacity
                                                                • Serving 500+ communities
• Transporting 3 million       • Moving 18% of natural gas        across Ontario                  • Solar, wind and
  barrels/day                    consumed in the U.S.                                               geothermal in North
                                                                • 40% of Ontario’s energy needs     America and Europe
We Fuel People’s Quality of Life
We already serve most homes in Ontario and expect to add more

• We serve more than 12 million people and
  businesses through 3.7 million meter
  connections
• We heat over 75% of Ontario homes
• We deliver 40% of Ontario’s
  energy needs
• #1 utility in North America for volume send
  out.
• #3 utility in North America for customer base
• Forecasting to connect 50,000 new meters
  each year
Enbridge Gas Inc.
 Executive Leadership Team

                                              Cynthia Hansen
                                              Executive VP &
                                              President, Utilities
                                              & Power
                                              Operations

              Malini Giridhar   Michelle           Jim Redford       Mike Shannon     Tanya
Jim Sanders                     George                                                Mushynski
              VP Business                          VP Energy         VP Storage
SVP                             VP                 Services          Transmission &
              Development &                                                           VP Customer
Operations                      Engineering                          IMO
              Regulatory                                                              Care

  18
Enbridge Gas Inc.
Customer Care Leadership Team

                                6
Enbridge Gas Inc.
Your Distribution Sales Team
Best in Class Service and Support
Regulatory Update

                        Amy Mikhaila
                    Manager, Rates
Enbridge Gas Inc.
Amalgamation

• Enbridge Gas Distribution and Union Gas received approval to
  amalgamate from the Ontario Energy Board in 2018
   • Both utilities joined to become Enbridge Gas Inc. on January
     1, 2019
• Deferred rebasing period of five years
   • Rebasing application to be filed for 2024 rates
Enbridge Gas Inc.
Amalgamation Con’t

• Earnings sharing mechanism
• Maintain existing rate structures and rate zones until rebasing
• Annual rate adjustments based on a Price Cap framework
• Incremental Capital Module (ICM) available for funding incremental
  capital
Enbridge Gas Inc.
2019-2023 Price Cap Framework

      Annual Rate Adjustment Formula
                               PCI = (I – X – S) ± Y ± Z + ICM

      Where rates are a function of:
     I = An inflation factor
    X = A zero Productivity factor
    S = A 0.3% Stretch Factor
    Y = Certain predetermined pass-through adjustments (gas supply costs, DSM)
    Z = Certain non-routine adjustments
  ICM = Incremental Capital Module rate riders
Enbridge Gas Inc.
2019 Rates Adjustment

• 2018 Rates approved        Rate Zone   Rate Class   Delivery Charges
                                                                             Total Bill
                                                                         (incl Gas Costs)
  as interim until 2019                     M4             -2.5%              -0.7%
  Rates approved                            M5             -1.8%              -0.4%
                                            M7             -2.0%              -0.4%
                               Union
                                            M9             1.2%               0.2%
                               South
• Table shows the                           T1             0.1%                0%
                                            T2             -2.0%              -0.1%
  estimated bill impact of
                                            T3             -5.3%              -0.7%
  2019 Rates adjustment                     100            0.7%               0.4%
                                            110            0.3%               0.1%
                                            115            0.8%               0.3%
                               EGD
                                            145            1.5%               0.7%
                                            135            0.0%               0.0%
                                            170            -2.4%              -0.8%
Enbridge Gas Inc.
Regulatory Outlook

                                        Decisions/                     Other
        Applications         2019
                                     Account Clearing
       2018 Deferrals        Q2                                 • QRAM applications
       (excluding DSM)              Account Clearing:             filed each quarter
       2021 Dawn-Parkway            2016 DSM Deferrals
       Expansion Project
                                                                  for gas cost rates
                                    Decision:
                             Q3
                                    Federal Carbon Charges        effective Jan 1,
                                    Cap-and-Trade Clearance
                                    2019 Rates                    April 1, July 1 and
                2020 Rates                                        Oct 1
                              Q4    Account Clearing:
                                    2018 Deferrals
           2021+ DSM Plan           Cap-and-Trade Clearance
                                    2019 Rates                  • 2017 & 2018 DSM
                             2020
                                    2020 Rates Implementation     Deferrals
Questions?
Federal Carbon Pricing
Program Update

                                                    Steve Dantzer
                 Specialist Carbon, Business Development Carbon
Topics

• Federal Carbon Pricing Program overview
• Registration Process
• Customer Impacts
What is the Federal Carbon Pricing Program?

• Carbon pricing is a central pillar of the Pan-Canadian Framework on Clean Growth & Climate Change
• Program is comprised of two elements:

                               Carbon levy on fossil fuels – effective April 1, 2019
                                  •   Generally payable by fuel producers or distributors
                                  •   $20/tCO2e (3.91¢/m3) in 2019
        FUEL                      •   Rising by $10 per year in April to $50/tCO2e (9.79 ¢/m3) in 2022
   CONSUMPTION &
                                  •   Eligible greenhouse operators receive 80% relief from the carbon charge
    HEATING FUEL

                    Output-based pricing system (OBPS) for large facilities – effective Jan 1, 2019
                      •   Facilities that emit >10 ktCO2e/yr and undertake an activity which has an output-based standard (OBS)
                      •   Designed to address competitiveness risks for emissions intensive and trade exposed industries
                      •   Mandatory participants: >50 ktCO2e/yr
    OBPS FACILITY     •   Voluntary participants: 10 to 50 ktCO2e/yr
Registration & Exemption Process
Customer Requirements

               • ECCC registration: Customer to submit application for OBPS covered facility certificate
  Step 1
   (federal)

               • CRA registration: Customer to submit application for exemption certificate (e.g., emitter, user)
  Step 2       • Greenhouses not required to register – download Form L404
   (federal)

               • Declaration: Customer to send required information to distributor
                  • Completed Facility Declaration Form
  Step 3          • CRA-issued exemption certificate
  (Enbridge)      • CRA-issued registration confirmation letter (not applicable to greenhouse operators)
Customer Impacts

• Enbridge’s request to charge customer and facility rate was NOT approved by the Ontario Energy Board
• Enbridge began recording costs in approved deferral accounts on April 1, 2019 & will seek to recover
  these costs through a future proceeding

Proposed Rates

                                2019 Rate       2019 Rate               Annual Emissions (tonnes CO2e/year)
 Charge
                                  (¢/m3)          ($/GJ)          50,000

 Federal Carbon Charge            3.91*          1.003                                   ?                    X

 Facility-related Charge
   UG rate zones                 0.0084          0.002
   EGD rate zone                 0.0036          0.001

 * Eligible greenhouse operators pay only 20% of the Federal Carbon Charge (0.782¢/m3)
Ontario Emissions Performance Standards

– Ontario is developing industrial Emission Performance
  Standards (EPS)
– If accepted by the federal government as meeting its
  benchmark, OBPS would “stand down” and EPS would
  apply
– Ontario intends for EPS to apply retroactively to Jan. 1,
  2019
– Sectoral coverage same as OBPS, may include
  greenhouses and MUSH sector as of 2020
– Stakeholder consultations ongoing, with draft regulation
  possible end of spring or early summer
Questions?
2021+ Natural Gas
Conservation in Ontario

                                        Igor Mozetic
            Supervisor Commercial Industrial Sales
Agenda

• The New Enbridge Gas Inc.

• Beyond 2021: The Natural Gas Conservation Framework

• Energy Conservation Programs

• Next Steps
Enbridge in Ontario

                                       Natural gas
• Enbridge Gas Inc. is the             3.7M customers, heating
  amalgamated Enbridge Gas             >75% of Ontario homes.
  Distribution and Union Gas.
                                       Energy Conservation
• Enbridge delivers about              Programs
  37% of Ontario’s total               Saved customers ~19 billion
  energy use each year.                cubic metres of natural gas.
                                       Renewables
• More than 100 years
                                       7 projects: wind, solar and
  of experience in safe                hydroelectric (490 MW).
  and reliable service.
                                       Liquids pipelines
• A new developer of                   3 pipelines which move
  electricity transmission.            419,000 barrels per day.
• The Sarnia-area Dawn Storage         Employment
  Hub is Canada’s largest and one of   ~4,800 Ontario-based
  the top-5 natural gas trading hubs   permanent and temporary staff.
  in North America.                    Community investment
                                       $6.6 M invested in community
                                       initiatives across Ontario in
                                       2017.
The Energy Conservation Regulatory (OEB) Process

• 2 Key Components
   • Framework: The “rule” book
   • Energy Conservation Multi-Year Program Plan
• 2015-2020 Framework and Plan
   • Expiring December 31, 2020
   • Programs available to large commercial and industrial customers:
      • Incentive rebates for equipment replacement
      • Strategic Energy Management
• 2021+ Framework and Plan
   • Implementation Date: January 2021
   • Stakeholder engagement underway
2021+ Timelines and Milestones

            TODAY

                           Phase 2
                         Development of EGI
                          Conservation Plan
2021+ Energy Conservation – Stakeholder Engagement

• Enbridge seeks to develop the next Framework and Plan collaboratively with
  stakeholders.

• By meeting with stakeholders and customers prior to OEB proceedings, Enbridge
  wants to:
   • Establish dialogue that fosters understanding of each party’s positions and rationale
   • Identify and analyze opportunities
   • Discuss critical issues and potential programs that customers value
Next Steps

  • Stakeholder meetings and consultations can be expected throughout the
    Framework and Plan development process.
  • Program staff will proactively engage with customers in the program
    design, planning and development phases.
  • We ask that you identify staff from your organization who can be available
    for discussions on specific topics.
  • We look forward to your input throughout this process.
Questions?
Networking/Break
Operational Update
Winter 2018/2019

GAS CONTROL

                                       Clancy O’Hara
                   Director, Gas Control & Management
Dawn Storage and Market Hub
A look back…

                      Growth over the last 5 years:

                              Storage by 15 PJ
                              Deliverability by 300 TJ
                              Take away by 1.5 PJ/d
                              Connectivity by 883 TJ/d

                          Rover

                          Nexus

                          Dawn LTFP

                          New Counterparties
Dawn Storage Pools
Two sets of strategically located assets

                                                                            Dawn

                                                                                   48
Not Shown – outside the Dawn area: Chatham D, Tipperary, Crowland and LNG
Dawn Storage Pools
Operating and managing as one

                                                                            Dawn

                                                                                   49
Not Shown – outside the Dawn area: Chatham D, Tipperary, Crowland and LNG
Operational Update
Winter 2018/2019 weather

50
Operational Update
Winter 2018/2019 Customer Interruptions

                                                                       1
                                                                       4

                                                                               3
          1. Sudbury – Maley Lateral (2 customers) – Jan 20 to 21
          2. The University of Waterloo – Jan 20 to 21
                                                                           2
                                                                           5
          3. IKO Madoc – Jan 20 to 21
          4. Sudbury – Maley Lateral (2 customers) – Jan 27 to Feb 1
          5. The University of Waterloo – Jan 27 to Feb 1
Operational Update
Winter 2018/2019 Customer Interruptions

                                                                                           2
                                                                                       5
                                                                                       1
          1. Enbridge CDA – GTA & Niagara – Jan 20 – Jan 22
          2. Enbridge EDA – Ottawa & Area – Jan 22
          3. South Delivery Area 1 – Windsor/Chatham – Jan 27 – Feb 1
                                                                                   4
          4. South Delivery Area 5 – Eastern Trans/Hamilton – Jan 27 – Feb 1
          5. Enbridge CDA – GTA & Niagara – Jan 30 – Feb 1                     3
Increased Supply to Dawn
Average daily supply—seasonal

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Supply Diversity at Dawn
Average daily supply—winter 2018/2019

54
Natural Gas
Meets peak electricity demand during summer

                      July 22, 2018             July 23, 2018   July 24 , 2018
            4 Nuclear Generators at Pickering    5,524 MWH       5,456 MWH
               Energy Centre came offline

                      19.6°C                       23.7°C          24.4°C

(Source
55      www.sygration.com)
Natural Gas
Meets peak electricity demand during extreme cold

                                          Jan 21,2019
                                          5,530 MWh
                                           -17.0°C

                   Feb 1,2019Feb 2,2019
                   4,575 MWh4,338 MWh
                     -15.1°C -6.1°C

56
(Source www.sygration.com)
Operational Update
Storage percentage full

57
Value of Dawn
Continues to play a critical role

                                    Storage Withdrawals
                                    • New record on Jan. 30 – 6.4 PJ.
                                    • 19% increase over previous record.

                                    Dawn Send-out
                                    • Peak on Feb. 1 – 6.49 PJ.

                                    Through Parkway Compression
                                    • New record on Jan. 21 – 3.7 PJ.

                                    Contracts
                                    • Record number of Hub contracts.
                                    • Record number of contracted
                                      counterparties.
58
Questions?
Gas Supply

                     Nicole Brunner
             Manager, Gas Supply
Gas Supply
What we do- coming together

• Provide services to 3.7 million customers in Ontario
     • 3.4 million are system gas customers consuming 496 PJ annually

• Leveraging two effective approaches to Gas Supply planning, asset acquisition and
  supply procurement

• Consistent Gas Supply Plan Principles providing base for future alignment
        • Cost effective, reliable and diverse supply to meet peak demands and maintain system integrity.

61
Gas Supply
Enbridge Gas Portfolio

                                                    Union Gas
Enbridge Gas Distribution
                                                Rate Zone Portfolio
  Rate Zone Portfolio

 62                         2018/19 Portfolio
Gas Supply
Diversified Enbridge Gas Portfolio- 2018/19

                                              • Diversified supply portfolio based on
                                                firm transportation assets.
                                              • Liquid trading locations offering
                                                supplier diversity and competitive
                                                market prices.
                                              • Total annual supply purchases of
                                                over 500 PJ/year.
                                              • Well- positioned to meet organic
                                                growth of utility rate base.

                                              Diverse & flexible portfolio to deliver
                                               the energy our customers require.
Gas Supply
Winter 2018-2019

 Colder than Normal Weather                                                 Highest Consumption Day
   Enbridge rate zone customers                                             On January 30th the Union MDA
experienced 7.3% colder than normal                                     experienced temperatures within one 1
             weather.                                                     HDD from a design day and Union
                                                                          South and the Enbridge CDA were
                                                                        within 3 HDD of their respective design
                                                                                  day temperatures.

                                                      20   January
                                      7%        5%         30, 2019
                                                     BCF

          Colder than Normal Weather                           Increased Consumption
     Union rate zone customers experienced 5%                Across the rate zones, Enbridge
             colder than normal weather.                    customers consumed over 20 BCF
                                                           more than plan because of colder than
                                                                     normal weather.
ICF Natural Gas
Outlook
ICF Natural Gas Outlook
Demand

66
ICF Natural Gas Outlook
Demand

67
ICF Natural Gas Outlook
Supply

68
ICF Natural Gas Outlook
Pricing
ICF Natural Gas Outlook
Pricing
Thank you
General Q&A
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