AN ENERGY COMPANY POWERING SUSTAINABLE COMMUNITIES

2013 sustainability report

SAFETY RELIABILITY EFFICIENCY INNOVATION LEADERSHIP CARING RELATIONSHIPS ENVIRONMENTAL STEWARDSHIP ABOUT POLLINATORS There are more than 1,000 species of bees Corporate Profile Table of Contents in Canada that serve as pollinators.

2 Financial Performance 26 ENVIRONMENTAL STEWARDSHIP 3 Message to Our Stakeholders 26 Building Resilient, Sustainable Energy GUELPH MUNICIPAL HOLDINGS inc. 7 Our Vision, Mission & Goals Infrastructure 7 Our Management Team 27 District Energy 8 Relationship with The City of Guelph 28 Combined Heat and Power 9 City-Wide District Energy 30 Achieving Excellence in Energy Conservation 10 2013 Fast Facts www.guelphhydroinc.com 33 Helping Business Customers Save Guelph Hydro Inc.* is a holding company, 100 per cent owned by Guelph Municipal Holdings Inc. which Money Through Energy Efficiency 12 SUSTAINABILITY COMMITMENT is, in turn, 100 per cent owned by the City of Guelph. Guelph Hydro Inc. wholly owns two subsidiary operating companies: Guelph Hydro Electric Systems Inc. and Envida Community Energy Inc. In addition 12 Materiality to distributing electricity through its regulated utility, Guelph Hydro Inc. and its subsidiaries are developing, 13 Risk Management 34 SOCIAL RESPONSIBILITY own and/or operate high-efficiency, low carbon, sustainable energy projects (solar, biogas, combined 14 Stakeholder Engagement 36 Top Ranking in Customer Service heat and power/cogeneration and district energy) that will help achieve the energy and greenhouse gas 38 Enhancing Customer Service emission reduction targets set out in the Guelph Community Energy Initiative while facilitating economic 16 DELIVERING ECONOMIC VALUE development in the community. 17 Working to Keep Electricity Rates

Affordable 40 CORPORATE GOVERNANCE 20 Understanding Electricity Charges 44 22 Operational Excellence in Our SUSTAINABILITY REPORTING Regulated Electrical Utility 45 GRI G3.1 Content Index

www.guelphhydro.com www.envida.ca cover - Planting Gardens to Attract Pollinators Guelph Hydro Electric Systems Inc. is a Envida Community Energy Inc. is a non- Pollinators are the insects and birds that pollinate more than 90 per cent of all flowering plants. They primarily regulated electricity distribution company that regulated, diversified infrastructure company include native bees, flies, butterflies, moths, birds and bats, and their daily work is essential for the successful delivers electricity safely and reliably to more than that owns and operates assets within three production of fruits and vegetables. Unfortunately, native pollinator populations are declining drastically due 52,000 homes and businesses in the City of Guelph business segments—electricity generation, to loss of habitat and food sources, disease and pesticide use. and Village of Rockwood, Ontario, Canada, and thermal distribution systems and energy promotes energy conservation to customers. management. In 2013, in an effort to help protect the indigenous pollinator population, Guelph Hydro Guelph Hydro Electric Systems Inc. is regulated by Envida Community Energy Inc assets include worked with Pollination Guelph to plant a pollinator-friendly garden on company the Ontario Energy Board, a Crown corporation that a 100-kilowatt rooftop solar facility and the grounds and, today has plans for other similar gardens in the community. regulates the province’s electricity and natural gas 1.8-megawatt Eastview Landfill Biogas Plant. sectors in the public interest. We have used images of pollinators and the plants they pollinate throughout this report. For more information about pollinators and pollinator gardens, please Stay Connected with us @GuelphHydro and @EnvidaEnergy contact Pollination Guelph at www.pollinationguelph.ca ABOUT Guelph Hydro Inc., Guelph Hydro Electric Systems Inc. and Envida Community Energy Inc. POLLINATORS Flies, bees, *Throughout this report, the use of the name Guelph Hydro refers to the holding company, Guelph Hydro Inc., which incorporates two wasps, butterflies subsidiary companies: a regulated utility, Guelph Hydro Electric Systems Inc., and a non-regulated company, Envida Community Energy Inc. and moths are The name Guelph Hydro Electric Systems Inc. is written out in full when referring specifically to the regulated electricity distribution utility. all pollinating insects. strong financial performance Guelph hydro inc. message to our stakeholders financial highlights (in millions of dollars) 2010 2011 2012 2013 Service Revenues $146.5 $153.2 $144.4 $166.6 At Guelph Hydro, we pride ourselves on being a trusted community partner: one that not only Net Operating Revenue $29.1 $28.1 $27.6 $23.6 provides a vital service, but also makes a fundamental contribution to the economic prosperity Total Assets $181.4 $193.5 $188.1 $190.5 and well-being of the Village of Rockwood and the City of Guelph, one of the fastest growing and most liveable municipalities in Ontario. Capital Expenditures $18.2 $26.5 $11.6 $14.9

Dividends Paid $1.5 $1.5 $3.0* $1.5 Last year resulted in some exceptional willingness of our people to respond swiftly to Total Debt $117.4 $66.0 $65.2 $64.6 achievements in customer satisfaction, safety, get the lights back on when a crisis hits. Thanks Total Equity $68.8 $78.3 $75.9 $71.8 reliability and energy conservation. Clearly, we to their tireless efforts, 99.9 per cent of our are continuing to build long-term, sustainable value customers had their power restored within *In 2012, Guelph Hydro Inc. provided our shareholder, Guelph Municipal Holdings Inc., with a dividend of $1.5 million for fiscal year 2011 for customers, our shareholder and the community 48 hours of the December ice storm. plus a dividend of $1.5 million for fiscal year 2012. by supplying safe, reliable and affordable electricity, providing a stable dividend and investing in innovative local energy projects designed to Benefits of Our Strong Financial Performance improve the environment. Maintaining a strong balance sheet and credit profile enables us to: Operating One of the More > Support significant capital investment Guelph Hydro Inc. 2013 Financial programs to ensure safety and reliability Resilient Grids in Ontario Statements are available at: of the electricity distribution network In the Ontario utility industry, 2013 will be www.guelphhydroinc.com remembered as the year when the resiliency of > Modernize and expand the electricity To request a hard copy, email: our electricity distribution networks was put to Jasmine Urisk, Chair, Guelph Hydro Inc. Board of Directors distribution network to support [email protected] the test by high winds, lightning, flooding and an & Barry Chuddy, Chief Executive Officer, Guelph Hydro Inc. community growth ice storm that hit just prior to the year-end holiday > Invest in sustainable energy projects that season. Although Guelph Hydro customers Inspired Energy Infrastructure improve the environment and support the experienced some weather-related power outages, Planning Guelph Community Energy Initiative the interruptions were not nearly as protracted Global climate change has been identified by the as those experienced in other areas. In fact, after scientific community as a social, environmental restoring power to customers in Guelph and and economic risk facing our communities. The Rockwood following the December ice storm, A Leader in Energy Conservation challenge for utilities is twofold—how to ensure the we were able to send crews to two neighbouring 2011-2014 2011-2014 Guelph resiliency of our electricity distribution networks in municipalities to assist them with their Provincial Energy Hydro Electric 2013 ENERGY provincial the face of changing weather patterns and how to restoration efforts. Conservation Systems Inc. CONSERVATION % of ranking help our customers and community reduce energy Target Target SAVINGS** Target (# of 76) use and greenhouse gas emissions. Reduction in 1,330 16.71 12 72% #4 It was no accident that we weathered the storms Peak Demand megawatts megawatts* megawatts of 2013 so well. Unquestionably, our engineering Climate change experts predict that severe weather Reduction in 6,000 79.53 92.33 116% #4 design standards, our grid modernization programs Consumption gigawatt hours gigawatt hours gigawatt hours events will become even more frequent in years including smart grid technologies and even our to come. We keep this thought in mind not only in *2014 net annual peak demand savings. Equivalent to removing one of Guelph Hydro Electric System Inc.’s largest customers three-year tree-trimming cycle have paid off in a designing and maintaining our modern electricity from the grid. **Unverified. robust system that is able to withstand weather distribution network, but also in developing local extremes. Coupled with this is the dedication and sustainable energy projects—solar, district energy,

2 Guelph Hydro inc. Sustainability Report | 2013 } combined heat and power and biogas—that will Top Ranking in Customer Engaging with Customers to equity of 8.24 per cent between 2009 and 2012, increase the resiliency and security of the power Satisfaction and Safety Determine Their Needs which was more than two per cent higher than our supply in our service territory. peer group average of 6.21 per cent. Our employees work very hard at ensuring we Society, the environment, technology and our are meeting the needs of our customers so, in customers’ needs are all changing rapidly. To gain Envida Community Energy Inc., our non-regulated It is important to note that dividends are only a mid-2013, we were absolutely delighted to learn insight into the issues that are material to our subsidiary, is working with the City of Guelph to small portion of the value Guelph Hydro contributes that our customers had ranked Guelph Hydro stakeholders, in 2014 we will be engaging various identify sustainable energy projects that will help to the economy. In 2013, the communities served number one in customer satisfaction among groups in face-to-face discussions and conducting Guelph achieve the significant reductions in by Guelph Hydro, as well as the Province of 14 Ontario electric utilities that took part in the on-line and telephone surveys. energy usage and greenhouse gas emissions Ontario, derived more than $58.9 million in Annual Electric Utility Customer Satisfaction Survey outlined in the Guelph Community Energy economic benefits from the company’s operations. conducted by UtilityPULSE, a division of Simul Initiative. Achieving these goals will put Guelph We will be using the feedback we receive to Added to this are the many environmental and Corporation. (See pg. 36) among the top energy performers in the world and design our capital investment and business plans social benefits described throughout this report. make it one of the most competitive and attractive for 2015 and beyond. This approach will put our communities in which to invest and live. stakeholders at the heart of our decision-making processes; thus, ensuring that our plans directly $58.9 million OUR SAFETY RECORD IS OUTSTANDING: GUELPH HYDRO support their needs. in Direct Economic Value* We are firmly focused on creating a sustainable $23.6 million energy future for the Guelph community. For this IS ONE OF ONLY TWO ELECTRICITY DISTRIBUTION Operating Expenses Creating Direct Economic Value Property taxes, water costs, reason we take a regional perspective, apply a UTILITIES IN ONTARIO TO HAVE ACHIEVED THE TOP facility costs, professional fees, long-term view and consider novel approaches Guelph Hydro is committed to sound financial local purchasing, employee LEVEL IN THE ZEROQUEST SAFETY AWARD PROGRAM. compensation and benefits, etc. and fresh ideas in our strategic planning. This was planning and budgeting that balances quality $1.5 million evidenced by two important achievements in 2013. electricity distribution services with affordability Dividends KAZI MAROUF, CHIEF OPERATING OFFICER, Dividends paid to our shareholder, GUELPH HYDRO ELECTRIC SYSTEMS INC. for ratepayers while fostering innovation and Guelph Municipal Holdings Inc. First, Envida Community Energy Inc. making investments in energy infrastructure that Capital Expenditures $14.9 million collaborated with the City of Guelph to develop a will benefit the community in the long term. Investments in electricity District Energy Strategic Plan. By formally setting distribution and thermal energy out a clear vision for a cleaner, more sustainable infrastructure to serve the needs Safety is always our number one priority so we We are proud of our strong balance sheet, of the growing community energy future underpinned by a city-wide district were also pleased to be recognized in 2013 for our investment-grade credit rating and stable dividend $2.8 million energy network, Guelph is, once again, way ahead Payments To Capital Providers ongoing commitment to safety with the Infrastructure history. With a dividend payment of $1.5 million and Government of other municipalities and setting an example Health and Safety Association’s top-level ZeroQuest® made in 2013, this brings the total amount of Interest and payments in lieu of for inspired energy infrastructure planning. Sustainability Award. Only one other utility in dividends paid to our shareholder over the past taxes Ontario has achieved this distinction in safety.* four years to $7.5 million, an average return on Energy Incentives and Rebates $16.0 million Secondly, 2013 marked the beginning of Includes the Ontario Clean Energy Benefit, rebates for customers commercial operation of Guelph Hydro’s thermal Leading in Energy Conservation Average 2009-2012 Return on Equity Comparison who generate renewable electricity, energy facility located in the Sleeman Centre. in Ontario and electricity conservation and This new high-efficiency heating and cooling demand management incentives paid to local residents and plant will function as a key component of the Ranking fourth in the province among 76 utilities, businesses Galt District Energy System that will serve Guelph Hydro is also ahead in achieving the $0.1 million energy conservation and peak electricity demand Corporate Giving Guelph’s downtown core. Details about this 8.24% 6.21% 6.32% Employer and employee district energy project as well as the company’s reduction targets that are set as a condition of Guelph All Ontario Neighbouring contributions to the United Way plans for combined heat and power projects in licence for all Ontario utilities by the Ontario Energy Hydro Electricity Electricity and other not-for-profit and Electric Distribution Distribution community organizations the community are outlined in the Environmental Board. Our efforts to help create an energy Systems Companies Companies* Inc. Stewardship section of this report. (See pg. 26) conservation culture are clearly having an impact, *In order to measure our financial impact, Guelph Hydro uses winning us kudos from residents, businesses, the the key Global Reporting Initiative metric of direct economic City, the Chamber of Commerce and local *Neighbouring electric utilities include: Cambridge and North value. This metric calculates the value generated and distributed Dumfries Hydro Inc., Centre Wellington Hydro Ltd., Halton environmental organizations. including: revenues, operating costs, employee compensation, Hills Hydro Inc., Kitchener-Wilmot Hydro Inc., Milton Hydro donations, other community investments, retained earnings *As at 2013. Distribution Inc., Wellington North Power Inc. and Woodstock and payments to capital providers and government. 4 Guelph Hydro inc. Sustainability Report | 2013 } Hydro Services Inc. We are proud of the many accomplishments stewardship will ensure our business continues of our people in 2013. Their ability to put our to thrive and provide value to our customers, Our Vision, Mission & Goals customers first—during normal operations or the our communities and our shareholder. worst weather-related event—is the key to our success and we thank them for their efforts. We have a terrific team here at Guelph Hydro Our Vision Our Goals and know we can count on them as we build An energy company powering sustainable > “Keeping the lights on” in the communities As we look forward, our commitment to operational our business as a leader in powering sustainable communities. we serve excellence, social responsibility and environmental communities. Our Mission > Benefiting our communities through the achievement of the energy and Provide superior customer service while environmental goals set out in the investing in energy-related initiatives that Guelph Community Energy Initiative benefit the communities in which we operate Jasmine Urisk Barry Chuddy and align with the energy-related objectives > Implementing a sustainable growth Chair, Guelph Hydro Inc. Board of Directors Chief Executive Officer, Guelph Hydro Inc. of the Province of Ontario, the City of Guelph, strategy in appropriate platforms and our shareholder, Guelph Municipal Holdings > Earning a fair and reasonable return Inc.; thus enabling the Guelph Hydro group of GUELPH HYDRO IS A VITAL PARTNER IN THE IMPLEMENTATION OF for our shareholder, Guelph Municipal companies to grow and enhance our position Holdings Inc. GUELPH’S COMMUNITY ENERGY INITIATIVE WHICH IS HAVING A SIGNIFICANT as an industry leader. IMPACT ON OUR LOCAL ECONOMY BY ENSURING A RESILIENT AND SUSTAINABLE ENERGY SUPPLY THAT KEEPS ENERGY DOLLARS Our management team LOCAL, ATTRACTS INVESTMENT AND CREATES JOBS.

GUELPH MAYOR KAREN FARBRIDGE

Guelph’s energy footprint getting smaller Barry Chuddy* Kazi Marouf*** Pankaj Sardana* Seymour Ron Collins**** Nicole Mailloux** Chief Executive Chief Operating Chief Financial Trachimovsky* Vice-President, Vice-President, The 2012 Energy Usage and Greenhouse Officer Officer Officer Corporate Business Development Human Resources Guelph Hydro Inc. Guelph Hydro Guelph Hydro Inc. Secretary & Partnerships Guelph Hydro Gas Emissions Summary Report produced Electric Systems Inc. Guelph Hydro Inc. Guelph Hydro Inc. Electric Systems Inc. by Guelph Hydro indicates that the City of Guelph’s per capita energy use and greenhouse gas emissions have fallen significantly since the introduction of the Guelph Community Energy Initiative.

Dan Amyot Cristina Birceanu Sandy Manners Erik Veneman Matt Weninger Michael Wittemund The data collected and summarized in this Director, Director, Director, Director, Director, Director, report focuses on the five most common Information Regulatory Corporate Operations Metering & Engineering Systems Affairs Communications Guelph Hydro Conservation Guelph Hydro sources of greenhouse gases that contribute Guelph Hydro Guelph Hydro Guelph Hydro Inc. Electric Systems Inc. Guelph Hydro Electric Systems Inc. to climate change: natural gas, gasoline, diesel Electric Systems Inc. Electric Systems Inc. Electric Systems Inc. fuel, electricity and municipal waste. *Corporate Officer of Guelph Hydro Inc., Guelph Hydro Electric Systems Inc., and Envida Community Energy Inc. **Corporate Officer of Guelph Hydro Inc. and Guelph Hydro Electric Systems Inc. ***Corporate Officer of Guelph Hydro Electric Systems Inc. and Envida Community Energy Inc. ****Corporate Officer of Guelph Hydro Inc. and Envida Community Energy Inc. Note: Biographies of Management Team are available at: www.guelphhydroinc.com, www.guelphhydro.com, www.envida.ca

6 Guelph Hydro inc. Sustainability Report | 2013 } Relationship with the City of Guelph city-wide District Energy Positive Environmental and Economic Outcomes the Foundation for a Cleaner, Healthier and Prosperous Community

Guelph Hydro and the City of Guelph enjoy a strong relationship that is Currently, the energy required to heat and cool homes and buildings accounts for about half of resulting in measurable, positive environmental impacts while attracting jobs Guelph’s total energy use and is a major contributor to greenhouse gas emissions. In order to and investment to the community. achieve the targets set out in the Guelph Community Energy Initiative, the efficiency of the heating and cooling of homes and buildings must be greatly improved.

Central to our vision for our community is the creation Guelph’s First District Energy of a highly-efficient, city-wide, thermal energy grid Facility as detailed in Guelph’s District Energy Strategic The first segment of a district energy network Plan. (See pg. 27) for Guelph’s downtown core–a thermal energy facility located in the Sleeman Centre–went into This landmark document outlines how this commercial operation in December 2013, signaling community-wide thermal grid could grow from a the beginning of an exciting new energy future At its core is the critical role we play supporting modest beginning with district energy networks for Guelph. (See pg. 27) Goals of Guelph’s Community the visionary and internationally renowned Guelph in two “high-priority” areas–downtown and the Energy Initiative by 2031 Community Energy Initiative: a Municipal Energy Hanlon Creek Business Park–and evolve over the Plan that sets out ambitious goals for energy and years with the addition of other “medium-priority” We believe our strategy to invest in a sustainable energy infrastructure to benefit the community, % greenhouse gas reductions to be achieved by 2031. areas to form an interconnected grid capable of 50 LESS providing large portions of the City with economical enhanced by strategic partnerships, will prove to heating and domestic hot water. The result would be a competitive advantage that will create long-term Guelph Hydro Inc. is actively engaged with the ENERGY value for our communities. City’s Economic Development Department be a significant drop in energy use and greenhouse per capita gas emissions. electricity, gas, in order to leverage the company’s activities water & identifying community energy projects to attract transportation % and anchor companies, jobs and investment in Fuel Flexibility of Community Energy Projects ALTERNATIVE 60 LESS the City of Guelph. ENERGY emissions District energy and combined heat and power Although natural gas is the most common fuel, Key community energy projects operational or systems are fuel flexible, providing the ability locally sourced renewable fuels can include solar, per capita Solar 6 tonnes vs under development include: to use a variety of renewable and fossil fuels. landfill or digester biogas, biomass including District Energy 12 tonnes of Combined Heat & Power greenhouse gas clean construction by-products and surplus > Galt District Energy System in downtown Guelph urban forest materials, and waste heat from municipal, commercial and industrial facilities. As a key member of the Mayor’s Task Force > Hanlon Creek Business Park Combined Heat and on Energy, Guelph Hydro is working with the Power Facility feeding a district energy thermal grid As an added benefit, these systems can City and other community partners to achieve Combined heat and power (CHP) unit in a be adapted or changed over time to new, the energy and environmental goals set out > recreational facility in the Guelph Community Energy Initiative more advantageous energy sources as they while simultaneously supporting the become available. > Eastview Landfill Gas Facility economic development objectives of the City. Heat Sources For Community Energy Illustration available at: www.envida.ca > Solar rooftop facilities

8 Guelph Hydro inc. Sustainability Report | 2013 } Distribution System Reliability See inside of back cover for additional detail about indices and calculations. 2013 fast facts Note: Reliability statistics for all Ontario local electricity distribution companies can be found at: www.OntarioEnergyBoard.ca 2013 FAST FACTS INDEX OF RELIABILITY Total Full-Time Employees 123 employees Excluding upstream loss of supply 99.9754% Guelph Hydro Inc. 8 Including upstream loss of supply 99.9621% Guelph Hydro Electric Systems Inc. 115 SAIDI – SYSTEM AVERAGE INTERRUPTION DURATION INDEX Envida Community Energy Inc. 0 Excluding upstream loss of supply 2.21 = Avg. customer without power 132.6 minutes Service Territory Guelph & Rockwood Including upstream loss of supply 3.41 = Avg. customer without power 204.6 minutes Population – Guelph and Rockwood 131,682 SAIFI – SYSTEM AVERAGE INTERRUPTION FREQUENCY INDEX Excluding upstream loss of supply 3.36 interruptions Total service area 93 square kilometres Total Customers 52,366 customers Including upstream loss of supply 4.01 interruptions Total Electricity Consumed 1,737 Gigawatt Hours CAIDI – CUSTOMER AVERAGE INTERRUPTION DURATION INDEX Excluding upstream loss of supply 0.66 = 40 minutes per avg. customer interrupted Residential Including upstream loss of supply 0.85 = 51 minutes per avg. customer interrupted Number of customer accounts 47,832 MAIFI – MOMENTARY AVERAGE INTERRUPTION FREQUENCY INDEX Total electricity consumption 378 gigawatt hours Number of momentary interruptions 258 Average monthly consumption 659 kilowatt hours Months with highest number of momentary interruptions July, August Commercial (Includes Scattered Loads, Sentinel Lighting And Streetlighting) Electricity Generated By Guelph Hydro Inc. Number of customer accounts 4,529 Total electricity generated 10,440,477 kilowatt hours Total electricity consumption 1,050 gigawatt hours ENVIDA COMMUNITY ENERGY – SOUTHGATE ROOFTOP SOLAR FACILITY Large Industrial Users 5,000 Kilowatts > Total electricity generated 122,662 kilowatt hours Number of customer accounts 5 Average monthly generation 10,222 kilowatt hours Total electricity consumption 309 gigawatt hours GUELPH HYDRO ELECTRIC SYSTEMS INC. – ARLEN TRANSFORMER STATION ROOFTOP SOLAR FACILITY Total Assets $190 Million Total electricity generated 4,029 kilowatt hours (5 months) Overhead lines / Underground cable 427 kilometres / 672 kilometres Average monthly generation 806 kilowatt hours (5 months) Total circuit length 1,099 kilometres ENVIDA COMMUNITY ENERGY – EASTVIEW LANDFILL BIOGAS FACILITY Municipal transformer stations / Substations 1 transformer station / 2 substations Total electricity generated 10,307,163 kilowatt hours Transformers 6,015 Average monthly generation 858,930 kilowatt hours Poles 10,715 Reliability performance 81.5% Fleet vehicles 41 (Includes 1 hybrid bucket truck, 1 all-electric GUELPH HYDRO ELECTRIC SYSTEMS INC. – EMERGENCY BACKUP GENERATOR service van) Total electricity generated 6,623 kilowatt hours LEED®*-certified office building and service centre 1 Electricity Generated By Customers Electricity generation facilities 3 with a capacity of 2 megawatts of energy (MWe) Customer Feed-in Tariff (FIT) installations 27 Thermal energy generation facilities 1 with a capacity of 13 million BTU per hour of Total electricity generated 7,929,844 kilowatt hours hot water and 350 tonnes of chilled water Average monthly generation 660,820 kilowatt hours Distribution System Performance Customer microFIT installations 242 System Peak Demand Total electricity generated 1,690,789 kilowatt hours 2013 peak demand – summer / winter 303 megawatts / 268 megawatts Average monthly generation 140,899 kilowatt hours *LEED® - Leadership in Energy and Environmental Design

ABOUT POLLINATORS Butterflies pollinate a wide variety of flowers that open during the day. They frequent large, brightly colored blooms. Unlike bees, butterflies can see red flowers.

10 Guelph Hydro inc. Sustainability Report | 2013 } SUSTAINABILITY COMMITMENT sustainability commitment Risk Management

At Guelph Hydro, we recognize our organization is a vital strategic asset that is fundamental to the An important part of good business planning and and its ability to significantly impact the health sustainability means understanding the risks that or safety of our employees or the public, or the well being, economic prosperity and growth of the communities we serve. By taking a triple-bottom- can impact our organization’s ability to create operations, financial standing or reputation of line approach to the management of our organization, we place as much focus on our environmental value for our shareholder, customers, employees our business. and social goals as we do on our economic performance for the benefit of our stakeholders. and other stakeholders. The Guelph Hydro Management Team and Board We publish an annual Sustainability Report because identified by stakeholders as material to our At Guelph Hydro, we recognize that a wide range review and update our risk assessment on a we believe it is important for our stakeholders to business in terms of economic, environmental of risks is associated not only in delivering a safe, regular schedule. The corporation has also initiated understand who we are, what we do, what we or social value creation. reliable and affordable supply of electricity to tens an internal audit program to provide independent, believe, how we conduct our business and where of thousands of customers who depend on us, but objective assurance of the adequacy of processes we are headed. Performance metrics established by the Ontario also in developing sustainable energy projects to and controls in place to manage risk. The Board Energy Board, Customer Satisfaction Survey results, benefit the community. of Directors reviews the risk matrix presented by Guelph Hydro’s goals in publishing this report media attention and feedback from stakeholders management on a regular basis. are to provide key stakeholders with information gathered through a variety of channels provide a Although risk cannot be entirely eliminated, we about the following: strong indication of the topics and issues that are identify, assess and take action to mitigate risks commonly associated with the energy industry of most significance, or material, to our stakeholders. > Actions taken in 2013 to ensure a safe, and those specific to our business. We prioritize our reliable supply of electricity, promote energy response to risks based on each risk’s probability conservation and integrate sustainable The following are the material issues that are business practices into our company addressed in this report. operations > Reliability and Affordability Health and Safety Risks > Activities and plans to develop sustainable Risks and compliance matters related to the health and safety of employees or the public. > Customer Service energy projects in support of the Guelph Includes injuries, fatalities, workplace violence and pandemics. Community Energy Initiative and the potential these projects may have on the economic > Energy Conservation development of the community Human Resources, Financial, Regulatory and Compliance Risks > Financial Performance Includes risks associated with human resources, accounting, operations, financial reporting, billing, credit, theft of power and customer receivables as well as those related > Company performance on key environmental, to regulatory or legal matters, environmental regulations and compliance. social and economic elements using the Global > Sustainable Energy Projects Reporting Initiative™ (GRI), an internationally In order to help us better identify topics and recognized standardized framework and operational Risks issues that are of particular concern to our indicators for sustainability reporting Includes risks that could have a severe impact on customer service, physical assets of stakeholders and develop strategies to address our network or our ability to deliver electricity or thermal energy. It includes security and Materiality them, Guelph Hydro will initiate a more formal access control, loss of supply, loss of critical infrastructure and cyber security. Stakeholder Engagement Strategy in 2014. Central to sustainability reporting is the concept Reputational Risks of materiality: reporting on those topics that are Risks resulting from loss of trust or confidence in the company by key stakeholder groups including employees, customers, the shareholder, the Ontario Energy Board, the Ministry of Energy, labour unions, community groups, business partners and the media.

12 Guelph Hydro inc. Sustainability Report | 2013 } residential & commercial customers SUSTAINABILITY COMMITMENT Stakeholder Engagement we ranked #1 in 2013, we We believe the solid, long-term relationships we forge with our many stakeholders, built on a platform of integrity, partnership and trust, contribute to the success of Guelph Hydro and are IN CUSTOMER SATISFACTION AMONG 14 ONTARIO ELECTRIC responded to UTILITIES that took part in the Annual Electric Utility Customer an essential part of our approach to sustainability. OF Satisfaction Survey and scored substantially higher than the 83.65% THE national and provincial customer satisfaction averages. We strive to be accessible and responsive to stakeholders’ needs, communicating in an open, honest and transparent manner using a variety of formal and informal communication channels. The information staying connected 40,520 presented on these two pages highlights some of ways we engaged with our key stakeholders in 2013. Stakeholder engagement will be an area of continued emphasis in 2014. calls received VISITORS TO community involvement GUELPHHYDRO.COM in 30 website TWO $1,000 traffic 137,000 seconds $61,244 13,000 AT OUR CUSTOMER CALL BURSARIES FOR FULL-TIME STUDENTS IN YEAR to the United Way CENTRE IN GUELPH TWO OF THE POWERLINE TECHNICIAN PROGRAM 4,300 VISITORS TO MOBILE SITE AT CONESTOGA COLLEGE VISITORS TO GUELPHHYDROINC.COM responded ELECTRICAL SAFETY & CO-OP STUDENTS ENERGY CONSERVATION EMPLOYED GREEN BUTTON to100% PRESENTATIONS $12,425 13 AT LOCAL SCHOOLS raised by employees for PROVIDES EASY 5 ACCESS TO ENERGY $6,025 Children’s Foundation PROCESSED of 4,878 in corporate of Guelph & Wellington, 872 USAGE DATA TransAtlantic Urban Climate Dialogue donations to St. Habitat for Humanity, 11,500 FOLLOWERS MOVE-IN/OUT written requests Joseph’s Health Southern Ontario Flood CUSTOMER ON TWITTER ORGANIZED BY THE UNIVERSITY OF BERLIN, Centre, Hospice Relief & the Canadian MOVES REQUESTS USING for information GERMANY. GUELPH HYDRO PARTNERED WITH THE Wellington and Cancer Society ONLINE FORMS CITY OF GUELPH TO HOST DELEGATES FROM GERMANY The Rotary 2,000 or services within AND THE U.S. TO SHARE INFORMATION ON ENERGY Forest - WITH OVER - CONSERVATION EFFORTS OUR 48 hours active participation in community organizations Employee & Corporate 900 USING OUR DEDICATED CUSTOMER Support live TWEETS SENT SERVICE EMAIL ADDRESS

sustainable Guelph-Wellington solutions guelph Local Immigration outage emerge partnership financial assistance guelph Guelph WAS USED chamber of EXTENSIVELY DURING programs FOR LOW INCOME commerce ELECTRICAL SAFETY map OUTAGES WORKSHOPS AND CRISIS CUSTOMERS ARE DELIVERED SIMULATIONS WITH THROUGH LOCAL SOCIAL SERVICE EMERGENCY RESPONDERS AGENCIES

14 Guelph Hydro inc. Sustainability Report | 2013 } Working to Keep Electricity Delivering Economic Value Distribution Rates Affordable The Ontario Energy Board has the responsibility ECONOMIC VALUE for setting electricity rates across the province. At Guelph Hydro, we deliver economic value by maintaining a strong balance sheet, keeping our However, electricity distribution charges for each distribution rates affordable, directly and indirectly contributing to the local economy and fostering of Ontario’s local electricity distribution companies the growth, economic prosperity and vitality of the communities we serve through the services (LDCs) vary widely, reflecting each utility’s unique provided by Guelph Hydro Electric Systems Inc. and Envida Community Energy Inc. operational structure and costs. As a result, customer electricity bills differ depending on the Maintaining Our Strong utility service territory in which they are located. 2013 Highlights Financial Performance When applying for new electricity distribution > Generated $58.9 million in economic Guelph Hydro Inc. is committed to maintaining rates, Guelph Hydro Electric Systems Inc. benefits from our operations for the the corporation’s solid financial standing and endeavours to keep rates affordable while providing our shareholder, Guelph Municipal benefit of our communities and the generating enough revenue to support capital Holdings Inc., with a fair return on investment Province of Ontario (See pg. 5) projects to upgrade and expand the network to while growing our balance sheet. (See pg. 2) meet the needs of our growing community. > Paid a dividend of $1.5 million to Guelph Municipal Holdings Inc. We deliver strong economic results while continuing how efficient is our operation? to ensure the affordability of our services > Maintained a strong investment-grade, through disciplined financial administration, Guelph Hydro’s ability to run an efficient and “A” credit rating from Standard and Poor’s careful management of risks, cost-effective and productive operation can be measured by efficient business practices and the strategic comparing our operating, maintenance and > Invested $14.9 million in capital projects growth of our non-regulated businesses. administration (OM&A) costs per customer in the regulated and non-regulated against those of other utilities. (See below) sides of our business, creating jobs and helping our communities thrive Fostering Economic Vitality and Community Growth Because we have invested in smart, cost- residential customer using 800 kilowatt hours > Paid out $1.2 million to customers in energy efficient technologies and worked hard to of electricity per month compares favourably Guelph Hydro Inc. and its subsidiaries foster conservation rebates and incentives keep operating costs down, the bill of a typical against those of other utilities. economic vitality and growth by: > Paid more than $330,000 in property taxes to support law enforcement, > Providing the electrical distribution infrastructure cost Comparison: fire and other emergency services and and services required to meet the needs of our Operating, Maintenance and Administrative Costs per Customer - 2012 municipal government programs including growing community $900 local schools $800 guelph hydro $700 > Developing district energy projects that will $600 electric systems inc. $500 attract new businesses and residents $400 $300 (See pg. 27) $200 $100 $0 > Indirectly creating jobs through local procurement

All other local electricity distribution companies (LDCs) in Ontario ABOUT POLLINATORS Source: Ontario Energy Board Bees are typically fuzzy and carry an electrostatic charge that helps pollen grains adhere to their bodies. Honey bees also have a specialized “pollen basket” structure on their hind legs. DID YOU KNOW? Over the past decade, electricity Operating One of the Most Measuring the cost per megawatt-hour of Comparing Electricity Prices prices in Canada have risen less than Efficient Electric Utilities electricity consumed in a utility’s service territory Against Other Household property taxes, water, gasoline and in the Province eliminates these sorts of inconsistencies and Expenses* Internet services.

ECONOMIC VALUE provides a fairer and more transparent picture Perhaps a more accurate way of comparing the of operational efficiency. How does what we get for our electricity bill efficiency of Guelph Hydro Electric Systems Inc. compare to what we spend on other necessities In Canada, as a share of major daily household against other Ontario utilities is to consider how Looked at in this fashion, it is clear that Guelph such as food, clothing and shelter or today’s expenses, electricity averages out to less than much it costs per megawatt-hour to distribute the Hydro Electric Systems Inc. operates one of the modern conveniences such as cell phones and three per cent, or three cents of every dollar electricity consumed in our service territory. most efficient electric utilities in the province. cable packages? spent. In many other parts of the world electricity can be far more expensive and forces many more difficult budgeting decisions. This calculation may give a truer picture of the Comparing Rates of Ontario’s Electric Utilities Using data from Statistics Canada, the Canadian operation’s productivity because not all “users” Electricity Association has compared the average Because we have invested in smart, cost-efficient of electricity are counted as “customers.” For daily amount Ontarians spend on electricity Power outages, like those experienced by many technologies and worked hard to keep operating example, in Guelph, university students who live against the average amounts paid for other goods Ontarians during the December 2013 ice storm, costs down, typical Guelph Hydro Electric Systems in residence or renters whose utility costs are and services commonly purchased by a household. serve as a stark reminder of just how much our Inc. customer bills compare favourably against included in their rent are not counted as customers modern society relies on a constant supply those of other utilities. despite the fact that they use electricity. Instead, Although how much Ontario households spend of power for lighting, heat, communications, the University or the landlord who pays the bill depends on personal circumstances, this analysis entertainment and, in some cases, survival. For companies looking to locate a new business or for an entire building is counted once each as the reveals that: expand a current operation, affordable electricity “customer.” These are important points to take into consideration rates are one of the factors they consider in making > The average Ontario household spends about when comparing the value of electricity against the a decision. Also, in an urban centre like Toronto, large numbers $3.34 per day on electricity** value of other household purchases. of “electricity users” make a workweek daily pilgrimage to jobs in the city or visit to attend > Many apartment dwellers spend less than For more information about the electricity sporting events or concerts. These users are not $3 a day on electricity** industry in Canada, visit the Canadian Electricity counted as customers despite the fact that they Association’s Power for the Future website at: may effectively use a lot of electricity while they > Electricity costs many dollars less per day than www.PowerForTheFuture.ca are in the city. the daily cost of shelter and food – two other indispensable necessities** cost comparison: Operating, maintenance & Administration costs per Megawatt Hour of Electricity Consumed - 2012 electricity pricing comparison for ontario, 2012

Index: Guelph Hydro = 1.0 Average Daily Household Cost 8.0 7.0 $50 6.0 $40 5.0 guelph hydro 4.0 $30 3.0 electric systems inc. 2.0 $20 1.0 0 $10 $5 $0 All other local electricity distribution companies (LDCs) in Ontario COST OF FOOD FUELS/ CLOTHING TELE- ELECTRICITY CABLE/ Source: Ontario Energy Board HOUSING (RENTED $17.19 LUBRICANTS AND COMMUNICATIONS $3.34 SATELLITE OR OWNED) (FOR CARS) FOOTWEAR SERVICES $2.14 $42.05 $9.25 $8.67 $5.02

Source: Statistics Canada

*Information and chart provided compliments of the Canadian Electricity Association – www.electricity.ca **Statistics Canada 18 Guelph Hydro inc. Sustainability Report | 2013 } understanding electricity charges Breakdown of Charges on a monthly Residential Electricity Bill DID YOU KNOW? avg, electricity consumption = 800 kilowatt hours / avg. bill = $122 78% of the charges on a Guelph Hydro electricity bill* are collected on behalf of other organzations. Only 22% of the total bill* is kept by Guelph Hydro Electric Systems Inc. to provide electricity monthly electricity bill* = $122 distribution services to Guelph and Rockwood.

22% to guelph hydro + 78% pass-through charges on average monthly bill =100%

GENERATION COSTS DISTRIBUTION COSTS Cost to generate the electricity consumed including Cost to distribute electricity generators $29 $69 building, operating and maintaining power generating in Guelph and Rockwood stations (nuclear, hydro, gas, wind, solar)

TRANSMISSIONS COSTS SERVICES PROVIDED BY hydro one GUELPH HYDRO FOR Cost of transmitting electricity from power generating stations to Guelph and Rockwood & other APPROX. $29 PER MONTH* $10 including building and maintaining high-voltage Infrastructure transmitters transmission lines and towers. Engineering design, construction, operation and maintenance of REGULATORY CHARGES government the infrastructure required to Costs for administering Ontario’s electricity system AND GOVERNMENT safely and reliably deliver $6 AGENCIES** and maintaining the reliability of the provincial grid electricity to the communities of Guelph and Rockwood. Infrastructure consists of poles, overhead wires and underground DEBT RETIREMENT CHARGE ontario cable, meters, transformers and $6 Set by the Ontario Ministry of Finance and collected electricity transformer substations. to pay down the debt of the former Ontario Hydro financial corporation

Emergency Services 24/7/365 power outage HARMONIZED SALES TAX revenue canada emergency services provided in $15 13% all kinds of weather by a highly trained workforce equipped with specialized service vehicles and equipment. ONTARIO CLEAN ENERGY BENEFIT customer 10% CREDIT administrative Services ($13)

Administrative services including maintaining a Customer Service Call Centre in Guelph. $ WATER CHARGES IF APPLICABLE city of guelph

Source: Ontario Energy Board. Data is based on a provincial average. Based on average monthly electricity bill of $122. *Represents an average residential customer on the Regulated Price Plan paying Time-of-Use rates for electricity. **Ontario Ministry of Energy, Ontario Energy Board, Independent Electricity System Operator, Ontario Power Authority

20 Guelph Hydro inc. Sustainability Report | 2013 } Improvements Made to Recognizing that rooftop solar panels can pose Operational Excellence in our the Electricity Distribution a new safety hazard for emergency personnel, Network Guelph Hydro provides training for firefighters

ECONOMIC VALUE and other first responders to help them minimize Regulated Electrical Utility The following is a list of some of the capital projects the risk of electrical shock should they encounter completed in 2013 to upgrade and maintain the solar panels when responding to a fire or other reliability of our electricity distribution network: emergency. With more than 52,000 homes and businesses in our service territory relying on the electricity we Investing in a Smarter Grid distribute to power their lives, safety and reliability are critical areas of focus for Guelph Hydro Electric > Acorn Place, Chestnut Place, Sherwood Drive, Terry Boulevard and Glenburnie Drive, Guelph Systems Inc. Guelph Hydro Electric Systems Inc. operates a - Upgrade of underground facilities and the sophisticated, modern, electricity distribution removal of pole transformers network that features intelligent monitoring 2013 Operational Highlights systems, automated controls and remotely > Speedvale Avenue East, Essex Street, operable switches that have the ability to detect Beechwood Avenue, Chadwick Avenue, a fault, isolate it and reroute power to restore > Achieved a system reliability index of > Connected 751 new residential and and Western Avenue, Guelph - Overhead power almost instantaneously. The ability of our 99.9754%* commercial customers pole line rebuilds network to “self-heal” is one of the hallmarks of > Invested $11.4 million to operate, maintain, > Restored power after the December 2013 a smart grid.  - Overhead pole line upgrade and expand the electricity ice storm to 99.9 per cent of customers > Harris Street, Rockwood distribution network within 48 hours rebuild Investments in smarter grid technologies are paying off in increased reliability and improved > Campbell Transformer Station, Campbell response times to identify and respond to outages. Strengthening and Road, Massey Road and Elmira Road North, The impact of these investments is significant. Help Us Plan for the Future Guelph - New underground feeder system Over the past five years, the average duration of Growing our Electricity unplanned outages has decreased by 23 percent. Distribution Network Building Electricity Distribution Infrastructure for the Long Term Integrating Renewable Energy Guelph is one of Ontario’s fastest growing In 2014, we will be consulting with With an eye on the future, Guelph Hydro Electric communities, attracting new residents at a stakeholders to obtain their input as we Systems Inc. is continuing to invest capital to steady pace along with new commercial and develop a new, multi-year capital program upgrade the electricity distribution network to industrial investments. and budget. This program will include plans accommodate more and different sources of renewable for the continuing replacement of aging and sustainable energy in the community. In 2013, Guelph Hydro Electric Systems Inc. infrastructure, increased system capacity, connected seven new residential subdivisions further implementation of smart grid Over the last three years alone, Guelph Hydro adding approximately 716 single-family dwellings technologies and the expansion of the Electric Systems Inc. has connected more than and apartment buildings to the electricity network into new neighbourhoods. 269 customer-owned rooftop and ground-mounted distribution network. solar facilities that have the potential to feed more A poster illustrating Guelph Hydro’s smart grid is For information on how to provide your than 8,000 kilowatts of electricity into the Ontario input to this plan, please email: available at: www.guelphhydro.com. Hard copies To meet this need, over the past five years, grid under the Ontario Power Authority’s Feed-in- of the poster may be requested by sending an Guelph Hydro Inc. built a new transformer station [email protected] Tariff (FIT) and microFIT programs. email to: [email protected] and invested $72.5 million to upgrade and expand infrastructure to ensure the reliability, resiliency, efficiency and security of the network.

*Excluding upstream loss of supply.

22 Guelph Hydro inc. Sustainability Report | 2013 } Guelph Hydro’s Resilient > Use of the highest quality engineering design Responding Swiftly When the Distribution System standards Lights Go Out

The reliable performance of our electricity > Proactive upgrading of equipment Power outages can be caused by storms, bird and ECONOMIC VALUE distribution network during normal operation as animal contact, and equipment failure impacting well as in the face of the high winds, heavy rains, > Preventive maintenance including infrared either Guelph Hydro Electric System Inc.’s local snow and ice associated with severe storms is scanning, pole testing and underground distribution network or the province’s transmission the direct result of: inspections system that transmits power from generating stations to our community. > Continual investments in new electricity > Smart grid technologies that automate distribution infrastructure including smart elements of our network We work hard to keep the lights on but, in the I BELIEVE OUR ROBUST DESIGN STANDARDS, grid technologies > Diligent tree-trimming event a power outage does occur, customers INVESTMENTS IN SMART GRID TECHNOLOGIES AND can be assured our employees can be counted infrared inspections upon to rise to the challenge and restore power CONSCIENTIOUS MAINTENANCE PROGRAMS, INCLUDING safely and as swiftly as possible. TREE TRIMMING, PAID OFF IN FEWER OUTAGES AND FASTER POWER RESTORATION TIMES why does my power go out? WHEN THE ICE STORM HIT IN DECEMBER. Despite weather extremes, the average time a KAZI MAROUF, CHIEF OPERATING OFFICER, Guelph Hydro Electric Systems Inc. customer was without power in the event of a failure on our GUELPH HYDRO ELECTRIC SYSTEMS INC. distribution network was 40 minutes in 2013.* Improved Outage Communication SCHEDULED Responding to the ever-increasing consumer MAINTENANCE & OTHER demand for up-to-the-minute information, in 2013, we improved our outage 50% communications with the addition of an 27% outage map on our website and mobile site as well as the use of Twitter (@GuelphHydro) to keep customers better informed of our NATURAL outage response. OCCURRENCES

23% “Hot spots” indicate equipment that is starting EQUIPMENT to degrade and requires replacement. TROUBLE & HUMAN INTERFERENCE

*Excludes upstream loss of supply.

24 Guelph Hydro inc. Sustainability Report | 2013 } District Energy - Efficient water heating to surrounding buildings via a ENVIRONMENTAL STEWARDSHIP Environmental Stewardship Heating and Cooling network of underground pipes. Currently, the energy required to heat and cool At the heart of the system is a district energy homes and buildings accounts for about one-half At Guelph Hydro, Environmental Stewardship is evaluated by our success in meeting or exceeding plant equipped with a boiler and chillers. Natural of Guelph’s total energy use and is a major gas or another fuel source is used to heat water all environmental laws, regulations and company policies, championing energy conservation, contributor to greenhouse gas emissions. In order in a boiler which is then fed to other buildings via investing in sustainable forms of energy and reducing our impact on the environment. to achieve the energy reduction targets set out in underground pipes. The district energy network the Community Energy Initiative, the heating and is practically invisible, forming an integral part of cooling of buildings must be greatly improved. 2013 Highlights Building Resilient, Sustainable the infrastructure of the City and installed with Energy Infrastructure other basic networks such as electricity, water > Guelph Hydro’s first thermal energy In 2013, Envida Community Energy Inc. assisted The Guelph Community Energy Initiative, a and sewage. plant went into commercial operation the City of Guelph in drafting a District Energy Municipal Energy Plan that was endorsed by in downtown Guelph Strategic Plan which sets out a vision for Guelph Guelph City Council in 2006, sets out ambitious as a cleaner, healthier and more prosperous goals for reductions in energy use and greenhouse > Worked with the City of Guelph to develop community powered by a secure, reliable, affordable gas emissions by 2031. In order to achieve these a District Energy Strategic Plan and sustainable district energy system. goals, the use of thermal energy and electricity must be maximized in the community. > Promoted saveONenergyOM conservation A community-wide district energy grid would result programs that achieved projected energy in a significant drop in energy use and greenhouse Guelph Hydro is working with the City of Guelph gases, positioning Guelph as one of the top savings of more than 3.7 million kilowatt to identify sustainable energy projects—solar, energy performers in Canada, helping to combat hours of electricity; enough energy to district energy, combined heat and power/ climate change and establishing the community as power 430 homes for one year cogeneration, biogas—under the Guelph Community Canada’s District Energy Centre of Excellence. Energy Initiative. Significant progress was made The Guelph District Energy Strategic Plan provides background information on district energy systems, > Helped reduce the network load demand in 2013 when the company’s first district energy What is district energy? benefits for individuals and communities and by a projected 5.2 megawatts by promoting facility went into commercial operation in December. This facility, located in the Sleeman Centre, will compelling examples of successful district energy OM District energy systems distribute hot or chilled saveONenergy efficiency programs networks in operation in other cities. To download serve as a central thermal energy plant for the water for space heating, cooling and/or domestic Galt District Energy System planned for downtown a copy visit: www.envida.ca > Supported the development of renewable Guelph. At the end of 2013, Guelph Hydro’s energy sources by connecting 18 Feed-in- portfolio of sustainable energy facilities included: Tariff (FIT) and 73 microFIT solar installations Commercial Operation - Sleeman Centre District Energy Facility to the company’s distribution system > Eastview Landfill Biogas Plant Guelph Hydro’s gas-fuelled thermal energy plant located in the Sleeman Centre, Guelph’s premier sports and > Generated 122,662 kilowatt hours of > 100-kilowatt solar facility on the roof of entertainment facility located in the downtown core, went renewable energy from the company’s Guelph Hydro’s head office into commercial operation in December 2013. 100-kilowatt rooftop solar facility and > 10-kilowatt solar facility on the roof of a Guelph 4,029 kilowatt hours from solar panels atop This new high-efficiency heating and cooling plant will Hydro Electric Systems Inc. transformer station function as the centre of the Galt District Energy System the Arlen Municipal Transformer Station Photo: © iStock.com/modesigns58 that will serve Guelph’s downtown core. A network of Sleeman Centre District Energy Facility > insulated underground pipes will transport hot water and > Planted a pollinator-friendly garden chilled water to buildings in the area to provide space heating and cooling as well as domestic hot water > LEED®-certified head office that features heating. Buildings connected to the district energy system will be equipped with a heat exchanger that ground-source geothermal heating will transfer the thermal energy from the thermal distribution system to the internal piping system in the and cooling buildings. Specifications for the Sleeman Centre District Energy Facility can be found at www.envida.ca

26 Guelph Hydro inc. Sustainability Report | 2013 } Combined Heat and Power – Efficient Electricity Generation

ENVIRONMENTAL STEWARDSHIP Environmentally Friendly hanlon creek Business Park Attracting Businesses and Jobs The Hanlon Creek Business Park, a 675-acre mixed use greenfield site located in the south Water Heat Recovery Unit Steam or Hot Water Cooling/Heating end of Guelph, is expected to attract 10,000 wurth¨ canada jobs by 2031. Hot combined heat and power system Exhaust Gases Recognizing that a local supply of electricity Building/Facility Envida District Energy System and thermal energy would be a competitive Fusion homes piping advantage when marketing the property to envida combined heat prospective tenants, the City’s Economic Fuel Engine or Turbine Generator Electricity Grid & power facility Development Department and Guelph Hydro Inc. and its subsidiaries formulated Combined heat and power (also called CHP or Combined heat and power as a heat source for plans to service the site with a cogeneration) is one of the most efficient ways to district energy combined heat and power facility that would function as a heat source for a generate electricity and is, therefore, an important One application particularly relevant to the Guelph Hanlon Creek Business Park Guelph district energy network. component of the municipality’s energy plan and community is to use the waste heat from a combined a key area of focus for Envida Community Energy. Envida Community Energy Combined heat and power facility to heat water for a district Heat and Power Facility (planned) Currently under development, this natural gas- energy system. fired combined heat and power plant will generate Envida District Energy System What is combined heat and 10.2 megawatts of electricity that will be fed underground insulated pipes power? When small combined heat and power units serve (existing and planned) into the Ontario grid under a 20-year contract as a heat source for a district energy thermal grid, with the Ontario Power Authority, granted to Combined heat and power refers to the simultaneous  W¨urth Canada Head Office Envida Community Energy in early 2014 under production of electricity and thermal energy from they can achieve operational efficiencies up to 80  Fusion Homes Ontario’s Combined Heat and Power Standard a single renewable or non-renewable fuel source per cent compared to the 30-45 per cent efficiencies Offer Program (CHPSOP). such as biogas, biomass or, more commonly, found in conventional electricity production. natural gas. Sources of energy in the community comparing energy efficiency guelph Waste heat from the generation of electricity that “Waste” Heat Rejected Guelph Hydro Inc. and subsidiaries community* would normally be exhausted into the atmosphere 60% to Environment installed/connected facility and capacity capacity is captured and used directly as hot air for heating Standard power plant Rooftop Solar Southgate Rooftop Solar Facility 6,174 kWe buildings or drying purposes or to produce steam, Feed-in Tariff program (FIT) 100 kWe hot water or chilled water. 40% Rooftop/Ground Mount Solar Arlen Transformer Station Rooftop Solar Facility 1,823 kWe Useful energy 10 kWe 100% produced for microFIT Program fueL input electricity Biogas Eastview Landfill Biogas Plant These highly efficient systems have long been -- 1,850 kWe popular in the manufacturing, healthcare, education “Waste” Heat Rejected 40% District Energy District Energy Facility - Sleeman Centre and government sectors since they reduce energy 20% to Environment -- Useful energy 13,200,000 BTU/hour heating and 350 tons cooling bills and carbon emissions, and provide a more produced for district energy/combined under development secure and reliable local source of electricity. heating/cooling heat & power plant via district District Energy Hanlon Creek Business Park - Temporary Portable energy system Information District Energy Plant not available For more information about combined heat and 40% 1,320,000 BTU/hour heating and 128 tons cooling power and district energy, please visit: Useful energy Combined Heat and Power West End Community Centre Information 100% produced for 400 kWe/550 kWt not available www.envida.ca or email [email protected]. fueL input electricity *Feeding electricity into the Ontario grid. Source: International District Energy Association kWe = Kilowatt Of Electrical Energy | kWt = Kilowatt Of Thermal Energy

28 Guelph Hydro inc. Sustainability Report | 2013 } Impact of residential and commercial Energy conservation programs ENVIRONMENTAL STEWARDSHIP Achieving Excellence in Energy Energy conservation programs saved more than 3.7 million kilowatt hours of electricity in 2013, enough energy Conservation to power more than 430 homes for one year and the equivalent of taking more than 530 cars off the road. saveONenergyOM saveONenergyOM FRIDGE & FREEZER PICKUP PROGRAM Reducing the amount of energy used by homes and businesses saves customers money on their SMALL BUSINESS LIGHTING electricity bills and avoids the need to build expensive new electricity generation and transmission SMALL COMMERCIAL capacity. It is also the cheapest and easiest way to reduce greenhouse gas emissions. CUSTOMERS UPGRADED 170 76 THEIR LIGHTING SYSTEMS Recognizing this, the Ontario Energy Board has and success stories for various projects HOUSEHOLDS TOOK & RECEIVED INCENTIVES set conservation targets for all electric utilities in undertaken in 2013. ADVANTAGE OF THE TOTALLING MORE THAN the province to be achieved by the end of 2014 SAVEONENERGYOM and monitors our progress against these targets. > Participated in Guelph Chamber of Commerce FRIDGE & FREEZER events including an event for large industrial $116,000 PICKUP PROGRAM The efforts of Guelph Hydro Electric Systems Inc. customers looking to save energy, and a Business to promote energy conservation have been so After Five tour of the Guelph Hydro facility. effective, the company ranks fourth in the province OM (see pg. 2) and is recognized as a leader among Innovative Large Projects saveONenergy electric utilities in the quest to achieve Ontario’s As we continue to strive toward our 2014 target, HEATING & COOLING INCENTIVE 7 million full energy efficiency potential. we’re excited about some innovative large projects KILOWATT HOURS SAVED & HOUSEHOLDS initiated in 2013 through ENGINEERING STUDIES, KILOWATT OM UPGRADED THEIR The success of our efforts is the result of dedicated offered as part of the saveONenergy PROCESS 2,200 HOURS OF HOME’S HEATING & work in building and maintaining relationships AND SYSTEMS UPGRADE INCENTIVE program. OF DEMAND REMOVED COOLING SYSTEM with our customers, delivery partners and These studies confirmed the financial viability of FROM THE ELECTRICITY WITH A beyond. In 2013, Guelph Hydro connected with a large combined heat and power (cogeneration) GRID EACH YEAR SAVEONENERGYOM the community to promote energy conservation project for an industrial customer and the potential 968 HEATING & COOLING in a variety of ways: for a large-scale thermal energy storage project INCENTIVE that we expect will lead to additional demand saveONenergyOM > Set up booths at local retail stores and large savings in 2015. RETROFIT PROGRAM community events, including the Multicultural saveONenergyOM Festival and Ribfest, using these opportunities Guelph Hydro promoted AUDIT FUNDING to distribute saveONenergyOM COUPONS and energy conservation by over 80 provide information. hosting a community BUSINESS booth, complete with CUSTOMERS 145 HAD UP TO retrofit > Held tradeshows for commercial and large a Kid’s Corner, and user customers to help them understand holding “Tweet Your Seat” trivia contests PROJECTS COMPLETED BY INDUSTRIAL, the energy conservation incentive programs at all the Hamilton Tiger Cat home games 50% of COMMERCIAL & INSTITUTIONAL CUSTOMERS that are available to them. The tradeshows played at the University of Guelph Alumni showcased the latest in energy efficiency Stadium during the 2013 season. the cost $4 million technology, and highlighted case studies OF AN ENERGY AUDIT PAID FOR PAID OUT IN REBATES SINCE 2007

30 Guelph Hydro inc. Sustainability Report | 2013 } ENVIRONMENTAL STEWARDSHIP Join the thousands of Ontarians Helping Business Customers Save who are removing their old, energy-guzzling fridge or freezer Money Through Energy Efficiency Adding up the

2,000 The Upper Grand In June 2013 Guelph FROM Lower electricity costs GUELPH HYDRO $125 SAVINGS/YEAR District School Board Hydro presented CUSTOMERS We pick up for FREE received $13,758 the University of $90 SAVINGS for switching to Guelph with a cheque for $106,733, the largest Municipal disposal fee avoided $30 SAVINGS ‘virtualization’ in their data centre. The potential customer incentive granted under the Disposing of potentially harmful savings were revealed following an energy audit saveONenergyOM AUDIT FUNDING initiative. pollutants in an environmentally But We’re Not responsible way of the servers and air conditioning system at DONE YET! PRICELESS the school board data centre. As part of Guelph In the fall of 2012, the University of Guelph identified WHY THEY DID IT Hydro’s efforts to encourage business uptake in the need for a campus-wide electricity, gas, and Most common reasons to remove saveONenergyOM programs, Guelph Hydro supplied From the electricity A typical fridge built in 1986 uses 1,500 kilowatt- water audit in order to move towards fulfilling your old fridge and/or freezer: hours (which could be costing up to $150 per year to ® electricity meters to measure baseline consumption run), while a new ENERGY STAR qualified appliance the University’s commitment to their Community we’ve saved... uses approximately two-thirds less energy. WE COULD POWER data. Making the switch to virtualization allowed Energy Plan and campus sustainability pledge. Buying a New Appliance? the school board to host multiple applications on MCW Custom Energy Solutions Ltd. audited 123 CONVENIENCE 19,000 a single server, with each application running as a campus buildings for the university and identified protected virtual machine while sharing resources conservation opportunities including chiller HOMESFOR AN ENTIRE YEAR 1 2 such as the central processing unit (CPU) and improvements, additional lighting upgrades, COST SAVINGS The right size The right model memory. building automation system (BAS) re-programming ENVIRONMENTAL 3 4 and upgrades, and heating, ventilation and air Low ENERGY STAR With these changes, the Upper Grand District conditioning (HVAC) system improvements. If all EnerGuide rated qualified School Board is estimated to reduce their energy of the audit report recommendations are converted consumption by close to 100,000 kilowatt to efficiency projects under the saveONenergyOM Step One: Step Two: hours annually. RETROFIT PROGRAM, the university will realize 1. PARTICIPATION 2. FRIDGE IS PICKED UP & RECYCLED substantial energy and demand savings. To qualify, you must have a full-sized Technicians strip away any copper, plastic and aluminum refrigerator or freezer that is: • Plastic can be recycled to make lots of things such as flower pots Thanks to incentives • Copper can be recycled for copper wiring • Car parts can be made from recycled aluminum received through the saveONenergyOM Refrigerators made before 1995 usually contain Freon 20 YEARS between in Freon is a chlorofluorocarbon (also known as a CFC). It can destroy the ozone layer RETROFIT PROGRAM, of age or 10-27 WORKING which protects us from the sun’s harmful UV rays. That’s why safe disposal of CFCs older cubic feet condition is so important. the Guelph Youth Music Centre on Cardigan Street PLUS, if you have at least one fridge or freezer collected, we’ll also pick up Every fridge is drilled and tipped to drain the oil upgraded the lighting in its Recital Hall from After all the oil is safely removed, the fridge can be destroyed in an environmentally your old qualifying window air responsible way conditioners and dehumidifiers at incandescent floodlights to high-efficiency LEDs, the same time. which is providing more reliable lighting for the facility’s users, as well as resulting in energy savings Step Three: Some chemicals used in fridges contain atmospheric pollutants 3. BALER TIME! and extra attention is given to ensure they are contained and destroyed. of 6,091 kilowatt hours a year. Next step - an industrial baler. It’s used to crush refrigerators. One baler can crush as many as 8 8 refrigerators at a time. Once the fridges are crushed, all of the steel is recycled and reused to help build IN THE END, VERY LITTLE GOES TO THE LANDFILL such things as bridges and roads. AND THAT’S PRETTY AMAZING! ABOUT POLLINATORS A pollinator-friendly garden contains native plants To learn more and to participate in this program, @saveONenergyONT that provide food, nesting or overwintering habitat on visit save energy.ca for all life stages of bees, flies, butterflies and other pollinators. For more information visit: www.pollinationguelph.ca ABOUT POLLINATORS Butterflies only lay eggs on native plants that will provide a good food Social Responsibility source for caterpillars. SOCIAL RESPONSIBILITY

In recognition of the company’s demonstrated Challenges of an Aging Workforce At Guelph Hydro, we understand that our highlights safety excellence, in 2013 the Infrastructure Health success depends on the support of our and Safety Association awarded Guelph Hydro Inc. Like many organizations in the energy sector, we face the challenge of an aging workforce coupled > 455,222 hours without a lost time injury employees and the communities we serve. the ZeroQuest® Sustainability Award, the highest with the prospect of a shortage of leadership, To gain that support, we believe we must level of recognition a company can achieve in the professional, and skilled trades talent. Provided employees with an average ZeroQuest program. > first and foremost hold safety—of our of 6.5 days of training employees, contractors, customers and the Promoting Electrical Safety in the Community Approximately 48 per cent of our workforce is > Provided two $1,000 bursaries to general public—as our number one priority. eligible to retire within the next 10 years. Many of Our efforts to keep people safe extend into the Powerline Technician students at We must also value and invest in our these employees have acquired in-depth, specialized community. In 2013, we provided electrical safety Conestoga College knowledge about our distribution system or employees, provide exceptional customer training to students in 13 schools, employees processes that needs to be passed on to the next service and give back to our communities. of two local firms and the general public at the generation. Guelph Emergency Preparedness Day and the Safety: Working Towards our Acton Fall Fair. Goal of Zero Injuries Recognizing that it takes four years of apprenticeship or formal training and several years of experience Working to deliver electricity or develop Investing in our Employees to develop the skills necessary to perform work sustainable energy projects can be hazardous. In order to best serve our customers and our on our distribution system, Guelph Hydro Electric Guelph Hydro Electric Systems Inc. line crews and communities, Guelph Hydro works hard to attract, Systems Inc. has hired nine apprentices and two other field staff not only have to prepare for the develop and retain an engaged, high-performing Engineers-in-Training over the past three years. dangers associated with working with electrical workforce—one of the best in the industry. We take equipment but also often have to deal with harsh pride in providing a safe and respectful workplace

weather conditions that add to the challenge where employees are highly valued, treated fairly, *employees by age and gender of ensuring worker safety. Many Guelph Hydro provided with challenging and meaningful work employees spend time on construction sites, work and recognized and rewarded for their skills, talent in offices or drive to meetings and have to be and dedication. 26 10 vigilant of the hazards that exist in each of these <35 In recognition of the company’s demonstrated environments. safety excellence, in 2013 the Infrastructure Health Guelph Hydro compensates all employees and Safety Association awarded Guelph Hydro Inc. competitively with the market to ensure it can Our goal of zero injuries, and the belief that it 41 25 the ZeroQuest® Sustainability Award, the highest attract and retain the skills and talent it needs. 35 - 55 is attainable, is woven into the cultural fabric of level of recognition a company can achieve in the our organization. Thanks to the efforts of all our ZeroQuest program. We invest in the future of our employees by employees to work safely every day, we are providing a wide variety of skills training as well as Manager of Loss Prevention and Environmental pleased to report that no lost-time incidents took 12 9 >55 funding for employees pursuing college or university Compliance, Roy Burch (right), also received the place in 2013. As of December 31, 2013, employees level courses in work-related programs on their Electrical Safety Authority’s Worker Safety Award had worked 455,222 hours without a lost time *Data includes Guelph Hydro Inc. and Guelph Hydro own time. In 2013, 15 employees benefitted from Electric Systems Inc. employees. in 2013. incident. the Educational Reimbursement Program.

34 Guelph Hydro inc. Sustainability Report | 2013 } Top Ranking in Customer Electricity Utility Customer Satisfaction Survey - 2013 Satisfaction SOCIAL RESPONSIBILITY At Guelph Hydro, we value our customers and take Electricity bill payers who are “Very or Fairly” pride in providing quick, responsive and consistent satisfied with the services provided. customer service. Our customers clearly recognize and appreciate our efforts as evidenced by the 96% fact that Guelph Hydro Electric Systems Inc. guelph hydro electric systems inc. was ranked number one in customer satisfaction among 14 Ontario electric utilities that took part in the Annual Electric Utility Customer Satisfaction 90% national Survey conducted in 2013 by UtilityPULSE, a division of Simul Corporation. 90% ontario The Annual Electric Utility Customer Satisfaction Survey gauges the satisfaction of customers with the quality and timeliness of information they receive as well as the professionalism, attitude and ABOUT helpfulness of staff. POLLINATORS customer service expectations Butterflies pollinate trees as well as flowers. With well-trained and knowledgeable customer Some species lay eggs service representatives, administrative staff and on the leaves of aspen, engineers all located in the company’s head office birch, cherry, hackberry, oak or willow trees. 83% 77% 72% 77% 73% 66% 81% 78% 73% 86% 74% 72% 95% 85% 82% 78% 77% 70% in Guelph and highly-skilled powerline workers and other operations staff out on the streets Time it Took to Time it Took to Helpfulness Level of Knowledge Level of Courtesy Quality of Information maintaining the distribution network, Guelph Contact Someone Deal with the Issue of Staff of Staff of Staff from Staff Hydro Electric Systems Inc. received top marks A 96% CUSTOMER SATISFACTION RATING IS SIMPLY in all aspects of customer service. THE BEST OF THE BEST AMONG THE 14 ONTARIO service quality

Power outages and billing problems are the ELECTRIC UTILITIES THAT WERE PART OF OUR 2013 two issues that are most likely to cause grief for ANNUAL CUSTOMER SATISFACTION SURVEY. utility customers. Guelph Hydro’s top ranking was buoyed by customer recognition of the utility’s THESE OUTSTANDING RESULTS FOR GUELPH HYDRO 92% 90% 90% 89% 83% 84% 89% 85% 86% 88% 85% 83% 88% 83% 83% reliable service and minimal billing issues. ELECTRIC SYSTEMS INC. ARE PROOF POSITIVE THAT Provides Consistent, Respected Company Accurate Billing Overall Excellent Trusted & Trustworthy Reliable Energy in the Community Quality Services Company With 96 per cent of surveyed customers reporting EXCELLENT SERVICE IS RECOGNIZED BY CUSTOMERS. they are “very” or “fairly” satisfied, Guelph Hydro SID RIDGLEY, PRESIDENT, UTILITYPULSE DIVISION, Electric Systems Inc. also scored substantially higher than the national and provincial customer SIMUL CORPORATION satisfaction averages for utility companies. 65% 66% 61% 72% 66% 65% 79% 74% 73% 79% 72% 68% 75% 71% 68%

Cost of Electricity Works to Keep Adapts to Customer Operates Cost Good Value For is Reasonable Costs Affordable Expectations Effective System Money

Source: Annual Electric Utility Customer Satisfaction Survey - UtilityPULSE, a division of Simul Corporation

36 Guelph Hydro inc. Sustainability Report | 2013 } Enhancing Customer Service Additionally, customers are able to contact Guelph follow us on twitter Hydro Electric Systems Inc. through multiple Inside the Guelph Hydro office on Southgate Drive, In 2013, Guelph Hydro began reaching out to SOCIAL RESPONSIBILITY channels including email and Twitter. In 2014, the community via Twitter. @GuelphHydro and Customer Service is undergoing a transformation. customers will be able to engage with our @EnvidaEnergy keep followers informed with Calls have become more complex as customers seek representatives via our website and online chat. help to better understand and manage their energy company news, energy efficiency insights, safety usage and information about how to conserve energy. tips and updates. Guelph Hydro’s mobile site contains links to our Guelph Hydro is responding to these evolving needs Outage Centre, Twitter stream, information for by providing our professional team of experienced During power outages, the immediacy of Twitter ABOUT POLLINATORS students and landlords and simple forms to use Customer Service Representatives with increased communication enables us to provide customers Hummingbirds can visit 1,000 to report streetlights out or other concerns. to 3,000 flowers a day. training and additional resources they can share with frequent updates. During and after the ice with customers. storm in December 2013, customers tweeted thank highlights you messages and kudos to show their appreciation The Guelph Hydro Electric Systems Inc. website, for the power restoration efforts of Guelph Hydro which was redesigned in early 2012, now > Our in-house call centre responded to Electric Systems Inc. line crews. incorporates on-line forms, an outage map 40,520 calls and almost 5,000 written @GuelphHydro Fantastic communication! and Green Button next-day access to electricity requests for information My go-to during our 24 hour outage in consumption data that is proving to be very @GuelphHydro Kudos to your teams Rockwood. Power back as predicted! useful to customers. > Opened and closed accounts for the who are working so hard to make sure Thank you! 11,500 customers who moved in and everyone will be safe and warm this out of our service territory holiday season. Thank you!

Big shout out of thanks to the @Guelph- Hydro crews working tirelessly through the night. Power restored at 3am! Thank you @GuelphHydro a lot of #thanks #icestorm2013 #guelph people in Ontario still don’t have power, but Guelph does. Good work!

So thankful to @GuelphHydro for getting my power back on before midnight last night. You guys are amazing! @GuelphHydro awesome!!! You guys are the best!!

137,000 people visited our website & 13,000 people accessed our mobile site in 2013.

38 Guelph Hydro inc. Sustainability Report | 2013 } > Six meetings of the Guelph Hydro Electric Each Guelph Hydro Inc., Guelph Hydro Electric Systems Inc. Board of Directors Systems Inc. and Envida Community Energy Inc.

CORPORATE GOVERNANCE Corporate Governance director attended at least 90 per cent of the > Seven meetings of the Envida Community Ener- total number of applicable Board and committee Guelph Hydro Inc. is a holding company, 100 per cent owned by Guelph Municipal Holdings Inc., gy Inc. Board of Directors meetings held during the period of his or her service on the Board and Board committees which, in turn, is 100 per cent owned by the City of Guelph. during 2013.

Our shareholder, Guelph Municipal Holdings Inc., Board Responsibilities & Composition > board members - as at december 31, 2013 is guided by the community vision and strategic priorities of Guelph City Council. Its Board reports > Board Member Biographies directly to Council and, thus, to Guelph citizens. guelph hydro envida community Independent Board Members guelph hydro inc. electric systems inc. energy inc. It operates as an independent and self-funding > Integrity, Ethics & Code of Conduct corporation governed by a Board comprised of municipal officials and private citizens who > Conflict of Interest Jasmine Urisk BOARD CHAIR BOARD CHAIR BOARD CHAIR contribute their broad experience, expertise and oversight. Guelph Municipal Holdings Inc. was set Composition of Boards of Directors BOARD VICE-CHAIR BOARD VICE-CHAIR BOARD VICE-CHAIR Brian Cowan up by Guelph City Council to manage select City of The Boards of Directors of Guelph Hydro Inc., FAC | GC FAC | GC FAC | GC Guelph assets, including Guelph Hydro Inc., for the Guelph Hydro Electric Systems Inc. and Envida purpose of maximizing their revenue potential Community Energy Inc. promote and champion HRCC HRCC HRCC and strengthening community prosperity. Jane Armstrong diversity in board composition and the recruitment GC - CHAIR GC - CHAIR GC - CHAIR of board members with a broad mix of business Guelph Hydro Inc. owns 100 per cent of the shares and professional backgrounds, gender and ethnicity. of two operating subsidiaries: Guelph Hydro Electric Jan Carr FAC FAC Systems Inc. and Envida Community Energy Inc. Although local representation on the Board from the Guelph franchise area is a relevant consideration Each of the three corporate entities—Guelph Hydro for membership, it is not mandatory in order to Rob Fennell GC Inc., Guelph Hydro Electric Systems Inc. and Envida ensure that all requisite skill sets, which may not Community Energy Inc.—has a separate Board* be readily available in the franchise area, are included. with members fully independent of management. Judy Fountain FAC - CHAIR FAC - CHAIR FAC - CHAIR In addition, the Board of Guelph Hydro Electric The Boards of Directors each maintain a matrix Systems Inc. has three members who are independent of skill sets and the Governance Committee, of the Guelph Hydro Inc. Board as required by the FAC comprised of representatives from each Board, Bob Huggard HRCC Ontario Energy Board’s Affiliate Relationships Code. annually reviews the composition of the Board against the available inventory of skills in order to Although the shares of Guelph Hydro Inc. are not FAC - VICE-CHAIR FAC - VICE-CHAIR ascertain if further recruitment will be required. Bill Koornstra publicly traded, the Board and Management Team GC - VICE-CHAIR GC - VICE-CHAIR strive to meet corporate governance reporting Board of Director Meeting mandates and comply with provisions of the Attendance During 2013 Barbara Leslie HRCC - VICE-CHAIR Ontario Securities Act and the Ontario Energy Board’s Affiliate Relationships Code. During 2013, the following meetings took place:

HRCC - CHAIR HRCC - CHAIR HRCC - CHAIR > Nine meetings of the Guelph Hydro Inc. Board of Rick Thompson The following information about our Boards is GC GC GC Directors and 21 meetings of Board committees posted on our websites: www.guelphhydroinc.com, www.guelphhydro.com and www.envida.ca. FAC - Finance and Audit Committee | HRCC - Human Resources and Compensation Committee | GC - Governance Committee

*Reference to “the Board” in this disclosure may include the plural, i.e. subsidiary Boards, as the context requires.

40 Guelph Hydro inc. Sustainability Report | 2013 } Responsibilities of Board > Overseeing the evaluation of the Boards and Skill Requirements honesty, integrity and impartiality; complying Committees committees including monitoring the annual with all legislation; and committing to safeguard CORPORATE GOVERNANCE improvement plan resulting from the evaluations The Board maintains a matrix of skill sets and company information and assets. Board committees are comprised of representatives the Governance Committee annually reviews the composition of the Board against the available from the Boards of each of the three companies: > Identifying Board and Board member The Board has an approved Whistleblower Policy inventory of skills in order to ascertain if further Guelph Hydro Inc., Guelph Hydro Electric Systems development opportunities which directly supports the Ethics and Values Policy. recruitment will be required. Among the skills Inc. and Envida Community Energy Inc. The Whistleblower Policy provides a confidential considered essential to discharge the Board’s > Ensuring compliance with legal, regulatory, process by which employees, shielded from Finance and Audit Committee oversight responsibilities are the following: and environmental obligations recrimination, can report suspected violations of the > Internal controls, financial statements and company Ethics and Values Policy and/or financial > Business Development, Mergers and reporting, and external audit > Reviewing Board compensation reporting, accounting, internal accounting controls, Acquisitions human resources, safety or environmental policies. > Compliance with legal, regulatory and > Assisting with the recruitment and selection > Communication, Marketing and Public Relations environmental obligations, and dividends process for Board and committee membership As well, the Board, through its Governance Committee, annually conducts an evaluation > Community Awareness > Systems relating to disclosure and internal Risk Management exercise led by autonomous experts. Once controls, risk management, ethics and completed, the Board and committees prepare > Electrical Utility Knowledge / Engineering and compliance with the strategic plan, business The Boards and Board committees of Guelph Hydro follow up and action plans and schedule time at Operations plan and budgets Inc. and its subsidiaries have specific oversight meetings throughout the remainder of the year to responsibility for risk management as follows: address issues and areas for improvement. In this > Environmental > Investment opportunities way, the Board achieves continuous improvement > The Boards evaluate risks associated with major in its relationships, processes and operations. Human Resources and Compensation Committee > Financial / Accounting / Investment investments and strategic initiatives

> Attraction, compensation, evaluation and > Governance, Strategic Planning and Management retention of employees > The Boards oversee the implementation and effectiveness of programs to ensure safety, > Human Resources / Diversity > Establishment of management performance ethics and compliance with legal, regulatory and environmental obligations objectives > Information Systems

Evaluation of management performance and >  The corporation’s Governance Committee > > Legal, Regulatory and / or Government Relations review of management compensation addresses the guidelines and policies that govern the processes for assessing and Integrity and Ethics > Succession planning managing major risks and allocates to other Board committees the specific responsibility The Board and the Management Team of Guelph > Organizational structure to oversee identified enterprise risks Hydro Inc. and its subsidiaries, Guelph Hydro Electric Systems Inc. and Envida Community Energy Inc. > Approval of employee benefit plans and > The corporation’s Human Resources and are all committed to the highest standards of incentive compensation Compensation Committee oversees the human corporate governance and business ethics. ABOUT resources regulations, policies and practices Governance Committee POLLINATORS including compensation that fit their scope Annually, Board and staff members confirm their Butterflies must land on flowers to feed. > Assisting in overseeing the corporation’s adherence to the company’s policy on Ethics and > The corporation’s Finance and Audit Committee Pollen sticks to their corporate governance principles and practices Values which includes being respectful; conducting legs as they walk oversees risk issues associated with overall business in an ethical manner by acting with around feeding from financial reporting and disclosure processes > Assisting in the strategic and business flower clusters. planning processes

42 Guelph Hydro inc. Sustainability Report | 2013 }

ABOUT POLLINATORS ABOUT than is commonly realized. than is commonly LOCATION OF LOCATION DISCLOSURE 2013 Sustainability Report - Message to Our Stakeholders - p.3 Our Stakeholders to - Message Report Sustainability 2013 cover - inside Profile & Corporate - Cover Report Sustainability 2013 cover - inside Profile - Corporate Report Sustainability 2013 cover - inside Profile - Corporate Report Sustainability 2013 Canada N1G 4Y1 Guelph, Ontario, Drive, Southgate 395 Canada only cover - inside Profile - Corporate Report Sustainability 2013 cover - inside Profile - Corporate Report Sustainability 2013 cover - inside Profile - Corporate Report Sustainability 2013 - p.10 Facts - Fast Report Sustainability 2013 changes No significant 34 - p. - Social Responsibility Report Sustainability 2013 Flies are more important as pollinators as pollinators important more Flies are LEVEL OF REPORTING Fully Fully Fully Fully Fully Fully Fully Fully Fully Fully Fully

(GRI) Content Index (GRI) ™ e DISCLOSURE Statement from the most senior decision-maker of the organization. of the organization. senior decision-maker the most from Statement Name of the organization. services. and/or products, Primary brands, including main divisions, of the organization, structure Operational ventures. subsidiaries, and joint companies, operating headquarters. of organization's Location and names operates, the organization where Number of countries specifically are or that with either major operations of countries in the report. covered issues the sustainability to relevant and legal form. of ownership Nature served, sectors breakdown, (including geographic served Markets of customers/beneficiaries). and types organization. Scale of the reporting size, regarding reporting period changes during the Significant or ownership. structure, period. in the reporting received Awards Index are included on pages 45-52 and are posted on company websites at: www.guelphhydroinc.com, www.guelphhydroinc.com, at: websites company on posted and are included on pages 45-52 are Index Global Reporting Initiativ Reporting Global as a functions Index The GRI Report. in the disclosures of all the an overview provides Index GRI Content The the At reported. has not been data certain or why has been reported what detailing by tool communication of interest. the GRI data them to directing users, report for mechanism is a navigational the Index same time, Content Supplement Utilities Sector C along with the Electric Level Application for Index Content GRI 3.1 The and www.envida.ca. www.guelphhydro.com www.globalreporting.org at is available levels and application about GRI information More to: be addressed may Comments Report. on our Sustainability feedback your welcome We [email protected] 1.1 2. Organizational Profile 2.1 2.2 2.3 2.4 2.5 2.6 2.7 2.8 2.9 2.10 Standard Disclosures: Profile Disclosures 1. Strategy & Analysis PROFILE DISCLOSURE GRI G3.1 Content Index GRI G3.1 supplement - GRI Application Level C Electric utilities sector

ABOUT POLLINATORS asters, daisies, butterfly bush, daisies, butterfly asters, Butterfly-friendly plants usually plants Butterfly-friendly purple coneflowers and zinnias. purple coneflowers butterfly weed, lantana, marigolds,weed, lantana, butterfly sweet-smelling flowers and include flowers sweet-smelling produce clusters of brightly colored colored of brightly clusters produce We are always seeking ways to improve improve to seeking ways always are We and feedback your and welcome our report or questions Please send any suggestions. [email protected] to: comments Results are contained in the GRI 3.1 Content Index Index Content in the GRI 3.1 contained are Results our on posted and the end of this report included at www.guelphhydroinc.com, websites: and www.envida.ca. www.guelphhydro.com stakeholders as determined through a variety of a variety through as determined stakeholders reported data and Statistics activities. engagement to information sufficient provide to intended are corporation’s the assess to enable stakeholders performance. sustainability all local, provincial or exceed meet to hard work We requirements and legislative regulatory and federal the Global against performance benchmark our and most the world’s (GRI), Initiative™ Reporting framework. reporting sustainability comprehensive

(GRI) ™

44 Guelph Hydro inc. Sustainability Report | 2013 } About This Report of Guelph Hydro the operations covers report This Envida Inc., and Systems Electric Inc., Guelph Hydro Community Energy Inc., all headquartered in Inc., all headquartered Energy Community Canada. Guelph, Ontario, and indicators topics are Included in the content economic, significant Guelph Hydro’s reflect that as issues as well and social impacts environmental our key to interest be of material to considered The standardized GRI reporting framework sets sets framework reporting GRI standardized The indicators out the principles and performance their and report measure can use to organizations and social performance. environmental, economic, Sustainability has used the GRI G3.1 Guelph Hydro Utilities Guidelines and the GRI Electric Reporting benchmark its performance to Supplement Sector has Guelph Hydro of sustainability. in the area as Report Sustainability the 2013 self-assessed Application a GRI 3.1 for the requirements meeting C. Level Global Reporting Initiative Global Reporting sustainability comprehensive most the world’s produces (GRI) Initiative™ Reporting Global The of transparency of data, comparability objectives: has three framework This framework. reporting reporting sustainability encourage It is designed to stakeholders. to and accountability information all organizations. by sustainability reporting sustainability

SUSTAINABILITY REPORTING Standard Disclosures: Performance Indicators 2. Organizational Profile (cont’d) Economic EU1 Installed capacity, broken down by primary energy source and Fully Regulatory regime - Not regulated LEVEL OF LOCATION OF by regulatory regime. Thermal energy generation facility - Hot water & chilled water = INDICATOR DISCLOSURE REPORTING DISCLOSURE 13,200,000 BTUs per hour heating / 350 tons cooling Economic performance

SUSTAINABILITY REPORTING Regulatory regime - Independent Electricity System Operator Emergency back-up generator - Natural gas - 500 kW EC1 Direct economic value generated and distributed, including Fully 2013 Sustainability Report - Creating Direct Economic Value - p.5, p.16 Eastview Landfill Biogas Facility - Landfill gas - 1.850 kW revenues, operating costs, employee compensation, donations and Southgate Rooftop Solar Facility - Solar energy - 100 kW other community investments, retained earnings, and payments to Arlen Rooftop Solar Facility - Solar energy = 10 kW capital providers and governments. EU2 Net energy output broken down by primary energy source and Fully Regulatory regime - Independent Electricity System Operator EC2 Financial implications and other risks and opportunities for the Partially Opportunities are reflected in the activities of Guelph Hydro's non- by regulatory regime. Emergency back-up generator = 6,623 kWh organization's activities due to climate change. regulated business activities associated with the company's support of the Southgate Rooftop Solar Facility = Solar energy = 122,662 kWh City of Guelph Community Energy Initiative detailed throughout the 2013 Eastview Landfill Biogas Facility = 10,307,163 kWh Sustainability Report. Arlen Rooftop Solar Facility – Solar energy – 4.029 kWh (5 months) Risks due to physical changes associated with climate change (e.g., impacts of modified weather patterns) are considered to be minimal. Although EU3 Number of residential, industrial, institutional and commercial Fully 2013 Sustainability Report - 2013 Fast Facts - p.10 infrastructure may be affected by extreme weather events, Guelph Hydro customer accounts. believes that such occurrences will not materially affect its operating or financial performance. In the unlikely circumstance that the company is EU4 Length of above and underground transmission and distribution Fully 2013 Sustainability Report - 2013 Fast Facts - p.10 materially affected by a major ice storm, wind storm, tornado, etc., costs lines by regulatory regime. associated with the damage caused may be recovered through rates upon

EU5 Allocation of CO2e emissions allowances or equivalent, broken Not Canada has not adopted a regulatory framework on the reduction of CO2 approval by the Ontario Energy Board. down by carbon trading framework. emissions in connection with the Kyoto Protocol and there is no emissions EC3 Coverage of the organization's defined benefit plan obligations. Fully Guelph Hydro provides a pension plan for its employees through the trading scheme in Canada. Therefore, Guelph Hydro Inc. does not report on Ontario Municipal Employees Retirement System (OMERS). OMERS is CO allowances. 2 a multi-employer pension plan which operates as the Ontario Municipal 3. Report Parameters Employee Retirement Fund (the “Fund”) and provides pensions for employees of Ontario municipalities, local boards, public utilities, and 3.1 Reporting period for information provided. Fully Calendar year / fiscal year 2013 school boards. The Fund is a contributory defined benefit pension plan, which is financed by equal contributions from participating employers and 3.2 Date of most recent previous report. Fully 2012 employees, and by the investment earnings of the Fund. Guelph Hydro uses 3.3 Reporting cycle. Fully Annual defined contribution plan accounting as it is only liable for contributions to the Plan. 3.4 Contact point for questions regarding the report or its contents. Fully Sandy Manners Director of Corporate Communications, Guelph Hydro Inc. EC4 Significant financial assistance received from government. Not Not material T: 519.837.4703 | E: [email protected] Market Presence 3.5 Process for defining report content. Fully 2013 Sustainability Report - Sustainability Commitment - p.12 2013 Sustainability Report - About This Report - p.44 EC5 Range of ratios of standard entry level wage by gender compared Fully Not relevant. Guelph Hydro's entry level wages are above provincial to local minimum wage at significant locations of operation. minimum wages. 3.6 Boundary of the report. Fully 2013 Sustainability Report - Sustainability Commitment - p.12 2013 Sustainability Report - About This Report - p.44 EC6 Policy, practices, and proportion of spending on locally-based Fully No formal policy regarding buying from locally-based suppliers. suppliers at significant locations of operation. 3.7 Specific limitations on the scope or boundary of the report. Fully 2013 Sustainability Report - Sustainability Commitment - p.12 2013 Sustainability Report - About This Report - p.44 EC7 Procedures for local hiring and proportion of senior management Fully No formal policy or common practice of granting hiring preference to local hired from the local community at significant locations of operation. residents. 3.8 Basis for reporting on joint ventures, subsidiaries, leased facilities, Fully 2013 Sustainability Report - Sustainability Commitment - p.12 outsourced operations, and other entities that can significantly affect 2013 Sustainability Report - About This Report - p. 44 Indirect economic impacts comparability from period to period and/or between organizations. EC8 Development and impact of infrastructure investments and Fully 2013 Sustainability Report - Relationship with the City of Guelph - p.8 3.10 Explanation of the effect of any re-statements of information Fully No re-statements services provided primarily for public benefit through commercial, 2013 Sustainability Report - Operational Excellence in Our Regulated provided in earlier reports, and the reasons for such re-statement in-kind, or pro bono engagement. Electrical Utility - p. 22 (e.g.,mergers/acquisitions, change of base years/periods, nature of 2012 Sustainability Report - Environmental Stewardship - p.26 business, measurement methods). EC9 Understanding and describing significant indirect economic Not 3.11 Significant changes from previous reporting periods in the scope, Fully No significant changes impacts, including the extent of impacts. boundary, or measurement methods applied in the report. Availability and reliability 3.12 Table identifying the location of the Standard Disclosures in the report. Fully 2013 Sustainability Report - G3.1 Content Index - p.45 EU6 Management approach to ensure short and long-term electricity Fully 2013 Sustainability Report - Message to Our Stakeholders - p. 3 4. Governance, Commitments and Engagement availability and reliability 2013 Sustainability Report - Operational Excellence in our Regulated Electrical Utility - p. 22 4.1 Governance structure of the organization, including committees Fully 2013 Sustainability Report - Corporate Governance - p.40 2013 Sustainability Report - Environmental Stewardship - p. 26 under the highest governance body responsible for specific tasks, such as setting strategy or organizational oversight. EU10 Planned capacity against projected electricity demand over the Not long term, broken down by energy source and regulatory regime. 4.2 Indicate whether the Chair of the highest governance body is also Fully 2013 Sustainability Report - Corporate Governance - p.40 an executive officer. The Board Chair is completely independent of management and, as such, is Demand-side management not an executive officer. Demand-side management programs including residential, EU7 Fully 2013 Sustainability Report - Environmental Stewardship - p.26 4.3 For organizations that have a unitary board structure, state the Fully 2013 Sustainability Report - Corporate Governance - p.40 commercial, institutional and industrial programs. number and gender of members of the highest governance body that are independent and/or non-executive members. system efficiency 4.4 Mechanisms for shareholders and employees to provide Fully Websites and 2013 Sustainability Report - Corporate Governance - p.40 Average generation efficiency of thermal plants by energy source EU11 Not Not applicable recommendations or direction to the highest governance body. and regulatory regime. 4.14 List of stakeholder groups engaged by the organization. Fully 2013 Sustainability Report - pg.14. Stakeholders are defined as but not Transmission and distribution losses as a percentage of total EU12 Not limited to: Boards of Directors, shareholder - Guelph Municipal Holdings energy. Inc., City of Guelph Mayor and City Council, Village of Rockwood Mayor and City Council, employees, International Brotherhood of Electrical research & development Workers, retirees, customers, the community, partner organizations, Research and development activity and expenditure aimed suppliers, government bodies / agencies, industry associations, investment Smart grid research and development costs included in operational EU8 at providing reliable electricity and promoting sustainable Not community, media and potential future employees. expenditures. development. 4.15 Basis for identification and selection of stakeholders with whom Fully Within the company’s service territory, all customers and the communities to engage. served are considered stakeholders. All stakeholders that are directly plant decommissioning affected by or directly affect Guelph Hydro Inc are engaged through EU9 Provisions for decommissioning of nuclear power sites. Not No nuclear power sites various means. A formal survey was conducted with customers in 2013.

46 Guelph Hydro inc. Sustainability Report | 2013 } Environmental Products & services

LEVEL OF LOCATION OF EN26 Initiatives to mitigate environmental impacts of products and Not Not tracked INDICATOR DISCLOSURE REPORTING DISCLOSURE services, and extent of impact mitigation. Materials EN27 Percentage of products sold and their packaging materials that Not Not applicable

SUSTAINABILITY REPORTING are reclaimed by category. EN1 Materials used by weight or volume. Not Not tracked Compliance EN2 Percentage of materials used that are recycled input materials. Not Not tracked EN28 Monetary value of significant fines and total number of non- Fully None Energy monetary sanctions for non-compliance with environmental laws EN3 Direct energy consumption by primary energy source. Fully Total direct energy consumption = 4,198,051.6 megajoules and regulations. Natural gas = 7,481 cubic metres = 291,833.8 megajoules Transport Diesel - 88,800 litres = 2,695,590.0 megajoules Gasoline - 44,029 litres = 1,210,627.7 megajoules EN29 Significant environmental impacts of transporting products and Not Not tracked other goods and materials used for the organization's operations, EN4 Indirect energy consumption by primary source. Fully 1,737 gigawatt-hours of electricity consumed supplied by the and transporting members of the workforce. Ontario Independent Electricity System Operator. Supply mix details are posted at: www.ieso.ca Overall EN5 Energy saved due to conservation and efficiency improvements. Fully 2013 Sustainability Report - p.2 and Environmental Stewardship - p.26 EN30 Total environmental protection expenditures and investments by Not Not tracked EN6 Initiatives to provide energy-efficient or renewable energy based Fully 2013 Sustainability Report - Environmental Stewardship - p.26 type. products and services, and reductions in energy requirements as Social: Labour Practices & Decent Work a result of these initiatives. LEVEL OF LOCATION OF EN7 Initiatives to reduce indirect energy consumption and reductions Fully 2013 Sustainability Report - p.2 and Environmental Stewardship - p.26 INDICATOR DISCLOSURE REPORTING DISCLOSURE achieved. Water Employment EU14 Programs and processes to ensure the availability of a skilled Fully The company hires apprentices into industry specific trades, such as All of Guelph Hydro's water comes from municipal sources. EN8 Total water withdrawal by source. Fully workforce. power line workers, meterpersons and system control operators, to ensure Total water consumption in 2013 = 1,792 cubic metres sustainability of continued resources. The company also hires Engineers in EN9 Water sources significantly affected by withdrawal of water. Not Not applicable Training to ensure a supply of qualified engineers and regularly participates in post-secondary co-operative education programs for students looking to EN10 Percentage and total volume of water recycled and reused. Fully No water is recycled or reused gain experience and exposure to various business units within the electricity Biodiversity industry. EU15 Percentage of employees eligible to retire in the next 5 and 10 Partially 5 Years – Guelph Hydro Electric Systems Inc. = 23% EN11 Location and size of land owned, leased, managed in, or adjacent Fully 13.8 acre head office property is located adjacent to wetland owned by the years broken down by job category and by region. 10 Years – Guelph Hydro Inc. = 20%; Guelph Hydro Electric Systems Inc. = 48% to, protected areas and areas of high biodiversity value outside Grand River Conservation Authority. protected areas. EU16 Policies and requirements regarding health and safety of Fully Guelph Hydro adheres to the Ontario Occupational Health and Safety Act. employees and employees of contractors and subcontractors. All employees are required to abide by the company’s 27 Health, Safety and EN12 Description of significant impacts of activities, products, and Fully Guelph Hydro’s potential impacts on biodiversity in its service territory Loss Control policies and 31 Operations Safe Work Practices. services on biodiversity in protected areas and areas of high are minor. Examples include: harm to wildlife that comes into contact with Contractors are governed by two policies: FAC-1, Employee, Contractor and biodiversity value outside protected areas. electrified infrastructure, emissions from fleet and facilities, construction Visitor Access and HSL-23, Contractor Management. of new infrastructure, in-service PCB/SF6 (sulfur hexafluoride) and other chemicals used in processes. LA1 Total workforce by employment type, employment contract, and Partially Total Management = 46 region, broken down by gender. Total Unionized = 77 EU13 Biodiversity of offset habitats compared to the biodiversity of Not Not tracked Total = 123 All located in Guelph, Ontario, Canada the affected areas Gender statistics not reported. EN13 Habitats protected or restored. Fully None LA2 Total number and rate of new employee hires and employee Not EN14 Strategies, current actions, and future plans for managing impacts Fully 2013 Sustainability Report - Planting Gardens to Attract Pollinators - p. 1 turnover by age group, gender, and region. on biodiversity. EU17 Days worked by contractor and subcontractor employees involved Not EN15 Number of IUCN Red List species and national conservation list Fully Not applicable in construction, operation and maintenance activities. species with habitats in areas affected by operations, by level of EU18 Percentage of contractor and subcontractor employees that have Fully 100% extinction risk. undergone relevant health and safety training. Emissions, effluents and waste LA3 Benefits provided to full-time employees that are not provided to Fully Extended health care, dental, life Insurance, long-term disability, employee EN16 Total direct and indirect greenhouse gas emissions by weight. Not Not tracked temporary or part-time employees, by major operations. assistance program, OMERS pension plan, computer purchase plan, educational assistance, wellness program. EN17 Other relevant indirect greenhouse gas emissions by weight. Not Not tracked LA15 Return to work and retention rates after parental leave, by gender. Not EN18 Initiatives to reduce greenhouse gas emissions and reductions Fully 2013 Sustainability Report - Environmental Stewardship - p.26 achieved. Labour/management relations EN19 Emissions of ozone-depleting substances by weight. Not Not tracked LA4 Percentage of employees covered by collective bargaining Fully 68% agreements. EN20 NO , SO , and other significant air emissions by type and weight. Not Not tracked X X LA5 Minimum notice period(s) regarding significant operational Fully Guelph Hydro does not specify minimum notice periods. However, the EN21 Total water discharge by quality and destination. Not Not tracked changes, including whether it is specified in collective agreements. company complies with all legal obligations. EN22 Total weight of waste by type and disposal method. Not Not tracked Occupational health and safety EN23 Total number and volume of significant spills. Fully There were no significant spills in 2013. LA6 Percentage of total workforce represented in formal joint Fully 100% of the workforce is represented in formal joint management-worker EN24 Weight of transported, imported, exported, or treated waste Not Not tracked management-worker health and safety committees that help health and safety committees. deemed hazardous under the terms of the Basel Convention monitor and advise on occupational health and safety programs. Annex I, II, III, and VIII, and percentage of transported waste LA7 Rates of injury, occupational diseases, lost days, and absenteeism, Partially Guelph Hydro tracks all incidents, including first aid level, and also tracks the shipped internationally. and number of work-related fatalities by region and by gender. potential for injury and/or loss. There were no lost time injuries or fatalities EN25 Identity, size, protected status, and biodiversity value of water Not All water is discharged into the municipal sewage system. reported in 2013. Information related to short-term absences (<5 days) in bodies and related habitats significantly affected by the reporting 2013 is not reported as it was not tracked. organization's discharges of water and runoff. LA8 Education, training, counseling, prevention, and risk-control Not programs in place to assist workforce members, their families, or community members regarding serious diseases. LA9 Health and safety topics covered in formal agreements with Fully Guelph Hydro’s collective agreement with its trade union, the International trade unions. Brotherhood of Electrical Workers (IBEW), is comprehensive and covers all relevant health and safety topics. All health and safety policies and 48 Guelph Hydro inc. Sustainability Report | 2013 } procedures are reviewed by the Joint Health and Safety Committee. Training and education Social: Society LA10 Average hours of training per year per employee by gender, and Partially Average hours of training: LEVEL OF LOCATION OF by employee category. Senior Management = 73 hours INDICATOR DISCLOSURE REPORTING DISCLOSURE Management/Supervisors/Professionals = 40 hours Trades/Technicians/Technologists = 68 hours Local communities SUSTAINABILITY REPORTING Union Clerical/Administration = 23 hours EU19 Stakeholder participation in the decision making process related to Not Gender statistics not tracked. energy planning and infrastructure development. LA11 Programs for skills management and lifelong learning that support Partially 2013 Sustainability Report - Social Responsibility - p.34 EU20 Approach to managing the impacts of displacement. Not Not applicable the continued employability of employees and assist them in managing career endings. SO1 Nature, scope, and effectiveness of any programs and practices Not Not applicable that assess and manage the impacts of operations on communities, LA12 Percentage of employees receiving regular performance and Fully 100% of non-unionized employees receive annual formal performance and including entering, operating, and exiting. career development reviews, by gender. career development reviews. 100% of unionized employees receive formal reviews when progressing through job rate steps. SO1 Percentage of operations with implemented local community Not engagement, impact assessments, and development programs. Diversity and equal opportunity EU22 Number of people physically or economically displaced and Not Not applicable LA13 Composition of governance bodies and breakdown of employees Not compensation, broken down by type of project. per employee category according to gender, age group, minority group membership, and other indicators of diversity. SO9 Operations with significant potential or actual negative impacts on Not local communities. Equal remuneration for women & men SO10 Prevention and mitigation measures implemented in operations Not LA14 Ratio of basic salary and remuneration of women to men by Not Guelph Hydro complies with the Pay Equity Act with significant potential or actual negative impacts on local employee category, by significant locations of operation. communities. Social: Human Rights Corruption

LEVEL OF LOCATION OF SO2 Percentage and total number of business units analyzed for risks Fully 100% – three companies INDICATOR DISCLOSURE REPORTING DISCLOSURE related to corruption. Investment & procurement practices SO3 Percentage of employees trained in organization's anti-corruption Fully 100% of employees are trained in policies and procedures that relate policies and procedures. to anti-corruption including the Code of Ethics and Purchasing Policy. HR1 Percentage and total number of significant investment agreements Not Not applicable Whistleblower process in place and employees trained. and contracts that include clauses incorporating human rights concerns, or that have undergone human rights screening. SO4 Actions taken in response to incidents of corruption. Fully No issues HR2 Percentage of significant suppliers, contractors and other business Not Not material Public policy partners that have undergone human rights screening, and actions SO5 Public policy positions and participation in public policy Fully Company representatives meet regularly with municipal, provincial and taken. development and lobbying. federal government officials and government agencies. The company does HR3 Total hours of employee training on policies and procedures Partially 100% of employees trained on Bill 168 and Accessibility for Ontarians with not participate in formal lobbying. concerning aspects of human rights that are relevant to operations, Disabilities. Information relating to total hours of training on policies related including the percentage of employees trained. to Human Rights is not available as it is not recorded separately from other SO6 Total value of financial and in-kind contributions to political parties, Fully None types of training such as safety or skills development, however training on politicians, and related institutions by country. Human Rights occurs every year at various meetings. Anti-competitive behaviour Non-discrimination SO7 Total number of legal actions for anti-competitive behavior, Fully None HR4 Total number of incidents of discrimination and corrective actions taken. Fully None anti-trust, and monopoly practices and their outcomes. Freedom of association and collective bargaining Compliance SO8 Monetary value of significant fines and total number of non- Fully None HR5 Operations and significant suppliers identified in which the right to Fully None monetary sanctions for non-compliance with laws and regulations. exercise freedom of association and collective bargaining may be violated or at significant risk, and actions taken to support these Disaster/Emergency planning and response rights. Contingency planning measures, disaster/emergency management Emergency Operations Plan, Business Continuity Planning Manual, training EU21 Fully Child labour plan and training programs, and recovery/restoration plans. of key personnel, participation in emergency planning exercises HR6 Operations and significant suppliers identified as having significant Fully None Social: product responsibility risk for incidents of child labour, and measures taken to contribute to the effective abolition of child labour. customer health & safety Prevention of forced and compulsory labour PR1 Life cycle stages in which health and safety impacts of products Fully Projects undergo an Environmental Assessment process. and services are assessed for improvement, and percentage Guelph Hydro constantly tests and audits the safety and reliability of its HR7 Operations and significant suppliers identified as having significant Fully None of significant products and services categories subject to such assets which deliver electricity (poles, wires, transformers, meters, etc.) risk for incidents of forced or compulsory labour, and measures to procedures. to customers. Meters are regularly tested to meet Industry Canada federal contribute to the elimination of all forms of forced or compulsory revenue metering accuracy requirements. labour. PR2 Total number of incidents of non-compliance with regulations and Fully None Security practices voluntary codes concerning health and safety impacts of products HR8 Percentage of security personnel trained in the organization's Fully Not applicable. No security personnel. and services during their life cycle, by type of outcomes. policies or procedures concerning aspects of human rights that are EU25 Number of injuries and fatalities to the public involving company Fully None relevant to operations. assets, including legal judgments, settlements and pending legal Indigenous rights cases of diseases. HR9 Total number of incidents of violations involving rights of Fully None indigenous people and actions taken. Assessment HR10 Percentage and total number of operations that have been subject Fully None to human rights reviews and/or impact assessments. Remediation Number of grievances related to human rights filed, addressed and Fully HR11 None resolved through formal grievance mechanisms.

50 Guelph Hydro inc. Sustainability Report | 2013 } Product & service labeling PR3 Type of product and service information required by procedures, Not and percentage of significant products and services subject to such information requirements.

SUSTAINABILITY REPORTING PR4 Total number of incidents of non-compliance with regulations and Fully None voluntary codes concerning product and service information and labeling, by type of outcomes. PR5 Practices related to customer satisfaction, including results of Fully 2013 Sustainability Report - Top Ranking in Customer Satisfaction - p. 36 surveys measuring customer satisfaction. Marketing communications PR6 Programs for adherence to laws, standards, and voluntary codes Fully The company adheres to all laws, standards and voluntary codes in its related to marketing communications, including advertising, marketing, public relations and sponsorship activities. The Director of promotion, and sponsorship. Corporate Communications is Accredited in Public Relations and is required to adhere to the Code of Ethics of the Canadian Public Relations Society (www.cprs.ca/aboutus/code_ethic.aspx) PR7 Total number of incidents of non-compliance with regulations and Fully None voluntary codes concerning marketing communications, including advertising, promotion, and sponsorship by type of outcomes. Customer privacy PR8 Total number of substantiated complaints regarding breaches of Fully None customer privacy and losses of customer data. Compliance PR9 Monetary value of significant fines for non-compliance with laws Fully None Design By: eSolutions, Waterloo | Printed By: Cober Printing, Kitchener and regulations concerning the provision and use of products and services. Global Reporting Initiative™ is a trademark of the Global Reporting Initiative Access LEED® - Leadership in Energy and Environmental Design is a registered trademark of the Canada Green Building Council EU23 Programs, including those in partnership with government, to Fully 2013 Sustainability Report - Operational Excellence in our Regulated ZeroQuest® is a registered trademark of the Electrical and Utilities Safety Association of Ontario improve or maintain access to electricity and customer support Electrical Utility - p. 22 services. 2013 Sustainability Report - Environmental Stewardship - p. 26 saveONenergyOM AUDIT PROGRAM 2013 Sustainability Report - Enhancing Customer Service - p. 38 saveONenergyOM FRIDGE AND FREEZER PICKUP EU26 Percentage of population unserved in licensed distribution or Fully Zero saveONenergyOM HEATING AND COOLING INCENTIVE PROGRAM service areas. saveONenergyOM PROCESS AND SYSTEMS UPGRADE INCENTIVE PROGRAM EU27 Number of residential disconnections for non-payment, broken Fully <48 hours = 142 OM down by duration of disconnection and by regulatory regime. 48 hours to 1 week = 37 saveONenergy RESIDENTIAL DEMAND RESPONSE 1 week to 1 month = 51 saveONenergyOM RETROFIT PROGRAM 1 month to 1 year = 32 OM >1 year = 0 saveONenergy SMALL BUSINESS LIGHTING PROGRAM EU28 Power outage frequency. Fully 2013 Sustainability Report - 2013 Fast Facts - p.11 Subject to the terms and conditions found at saveonenergy.ca. Subject to change without notice. EU29 Average power outage duration. Fully 2013 Sustainability Report - 2013 Fast Facts - p.11 OM Official marks of the Ontario Power Authority. Used under license. EU30 Average plant availability factor by energy source and by Fully 2013 Sustainability Report - 2012 Fast Facts - p.11 regulatory regime. Provision of information RELIABILITY INDICATORS EU24 Practices to address language, cultural, low literacy and disability Fully Guelph Hydro is committed to providing accessible, quality service to Distribution system reliability indices (SAIFI, SAIDI, CAIDI) include all planned and unplanned interruptions lasting more than one related barriers to accessing and safely using electricity and all customers. Employees have received training and the company's minute. Momentary interruptions (MAIFI) last less than one minute. customer support services. Accessibility practices are outlined on the company websites at: www.guelphhydroinc.com, www.guelphhydro.com and www.envida.ca Loss of supply refers to customer interruptions caused by an outage that occurs upstream of the Guelph Hydro Electric System Inc. distribution system. ABOUT POLLINATORS Calculation Formulas: Pollinating insects and birds SAIFI = Total customer interruptions / Total customers served are an indispensable natural SAIDI = Total hours of customer interruptions / Total customers served resource and their daily work is CAIDI = SAIDI/SAIFI essential for the production of Average amount of time customers were without power = CAIDI * 60 over a billion dollars of apples, Index of Reliability = (# of hours in the year – SAIDI) / (# of hours in the year) pears, cucumbers, melons, berries and many other kinds of Canadian farm produce. The paper used in the printing of this report is certified to meet the requirements of the Forest Stewardship For more information Council® (FSC®). FSC-certified forests must be managed according to strict harvesting guidelines that on pollinators, visit: protect wildlife habitat and endangered species, ensure clean water by respecting rivers and waterways, www.pollinationguelph.ca conserve areas of high biodiversity, are not planted with genetically modified trees, and cannot be converted in plantations.

52 Guelph Hydro inc. Sustainability Report | 2013 } 395 Southgate Drive, Guelph, ON N1G 4Y1 T. 519.822.3017 | E. [email protected]

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