ONTARIO POWER GENERATION INC. ANNUAL INFORMATION FORM FOR THE YEAR ENDED DECEMBER 31, 2018 March 8, 2019 ANNUAL INFORMATION FORM FOR THE YEAR ENDED DECEMBER 31, 2018 Table of Contents PRESENTATION OF INFORMATION................................................................................................................... 1 ADDITIONAL INFORMATION ............................................................................................................................. 1 FORWARD-LOOKING INFORMATION ................................................................................................................ 1 CORPORATE STRUCTURE .............................................................................................................................. 2 OVERVIEW OF OPG ....................................................................................................................................... 2 Strategic Imperatives .............................................................................................................................. 4 GENERAL DEVELOPMENT OF THE BUSINESS .................................................................................................. 5 General Development .............................................................................................................................. 5 Nuclear Business Development ............................................................................................................ 15 Renewable Generation Business Development .................................................................................... 18 Thermal Business Development ............................................................................................................ 19 DESCRIPTION OF THE BUSINESS .................................................................................................................. 20 Electricity Industry and Electricity Markets ............................................................................................ 20 Water Rights .......................................................................................................................................... 24 Generation Operations .......................................................................................................................... 27 Nuclear ............................................................................................................................................... 27 Renewable Generation ...................................................................................................................... 33 Thermal .............................................................................................................................................. 37 Regulated – Nuclear Waste Management Segment ............................................................................. 39 Fair Hydro Trust Segment ..................................................................................................................... 44 Indigenous Relations ............................................................................................................................. 44 Workplace Safety and Public Safety ..................................................................................................... 46 Environment ........................................................................................................................................... 48 People and Culture ................................................................................................................................ 50 Insurance ............................................................................................................................................... 52 RISK FACTORS ............................................................................................................................................. 52 DIVIDENDS ................................................................................................................................................... 53 DESCRIPTION OF CAPITAL STRUCTURE ....................................................................................................... 53 CREDIT RATINGS ......................................................................................................................................... 53 MARKET FOR SECURITIES ........................................................................................................................... 54 CORPORATE GOVERNANCE ......................................................................................................................... 55 EXECUTIVE OFFICERS .................................................................................................................................. 77 INDEBTEDNESS OF DIRECTORS AND EXECUTIVE OFFICERS ......................................................................... 78 CEASE TRADE ORDERS, BANKRUPTCIES, PENALTIES OR SANCTIONS ........................................................ 78 AUDIT AND RISK COMMITTEE INFORMATION ................................................................................................ 79 INTEREST OF MANAGEMENT AND OTHERS IN MATERIAL TRANSACTIONS .................................................... 80 Relationship with the Province and the OEFC ...................................................................................... 80 LEGAL PROCEEDINGS AND REGULATORY ACTIONS ..................................................................................... 82 MATERIAL CONTRACTS ................................................................................................................................ 83 INTERESTS OF EXPERTS .............................................................................................................................. 83 GLOSSARY ...................................................................................................................................... 84 APPENDIX A – AUDIT AND RISK COMMITTEE CHARTER ....................................................................... A-1 APPENDIX B – STATEMENT OF EXECUTIVE COMPENSATION ................................................................ B-1 PRESENTATION OF INFORMATION References in this Annual Information Form (AIF) to the “Company”, the “Corporation” or “OPG” are made to Ontario Power Generation Inc. Unless otherwise noted, the information contained in this AIF is as at or for the year ended December 31, 2018. Amounts are expressed in Canadian dollars unless otherwise indicated. Financial information is presented in accordance with United States generally accepted accounting principles (US GAAP). This AIF is dated March 8, 2019. ADDITIONAL INFORMATION Additional information relating to the Company may be found on SEDAR at www.sedar.com. Additional financial information relating to the Company is provided in the Company’s annual Management’s Discussion and Analysis (MD&A) and audited consolidated financial statements as at and for the year ended December 31, 2018, which is available on SEDAR at www.sedar.com and on the Company’s website at www.opg.com. The above information is not, unless otherwise specifically stated, incorporated by reference into this AIF. FORWARD-LOOKING INFORMATION This AIF contains forward-looking statements that reflect OPG’s current views regarding certain future events and circumstances. Any statement contained in this document that is not current or historical is a forward-looking statement. OPG generally uses words such as “anticipate”, “believe”, “foresee”, “forecast”, “estimate”, “expect”, “schedule”, “intend”, “plan”, “project”, “seek”, “target”, “goal”, “strategy”, “may”, “will”, “should”, “could” and other similar words and expressions to indicate forward-looking statements. The absence of any such word or expression does not indicate that a statement is not forward-looking. All forward-looking statements involve inherent assumptions, risks and uncertainties. All forward-looking statements could be inaccurate to a material degree. In particular, forward-looking statements may contain assumptions such as those relating to OPG’s generating station performance and availability, fuel costs, surplus baseload generation (SBG), cost of fixed asset removal and nuclear waste management, performance and earnings of investment funds, refurbishment of existing facilities, development and construction of new facilities, pension and other post-employment benefit (OPEB) obligations and funds, income taxes, proposed new legislation, the ongoing evolution of electricity industries in Ontario and the United States (US), the continued application and renewal of power purchase agreements for non-regulated facilities, foreign currency exchange rates, environmental and other regulatory requirements, operating licence applications to the Canadian Nuclear Safety Commission (CNSC) and the Federal Energy Regulatory Commission (FERC), health, safety and environmental developments, business continuity events, the weather, financing and liquidity, applications to the Ontario Energy Board (OEB) for regulated prices, the impact of regulatory decisions by the OEB, the Ontario Fair Hydro Plan Act, 2017 (the Fair Hydro Act or the Act), forecasts of earnings, cash flows, Return on Equity Excluding Accumulated Other Comprehensive Income (ROE Excluding AOCI), Total Generating Cost (TGC), Operations, Maintenance and Administration