1. RELIABILITY Customer Meeting November 5, 2009

2. 2 NY Investment Plan  Supports National Grid’s vision to be the foremost electricity and gas company, delivering unparalleled efficiency, reliability, and safety vital to the well-being of our customers and communities.  The capital plan will deliver our objectives around safety, reliability, efficiency, and customer satisfaction  The Customer reliability objectives are a primary driver of our capacity projects, reliability programs, and asset replacement programs. The capital plan is designed to:  Deliver performance that meets all regulatory targets  Begins the renewal of our aged infrastructure to deliver a sustainable network.  Provide our customers with a reliable, cost effective service

3. 3 Capital Investments for Reliability  Reliability Enhancement Program –  $1.47 Billion for Upstate NY  2007 – 2011 Commitment period

4. 4 Key Drivers of Investment System Capacity and Stability Capital expenditures undertaken to upgrade the capability of the T&D delivery system beyond minimum requirements in order to provide improved thermal loading, voltage, stability, reliability or availability performance. Asset Condition Capital expenditures required to reduce the risk and consequences of failures of T&D assets e.g. replacing or upgrading system elements such as overhead lines (including wood poles), underground cables and substation equipment Statutory or Regulatory Requirements Capital expenditures required to ensure that the T&D facilities meet the minimum legal, regulatory and contractual obligations of the Company. These items include New Business Residential, New Business Commercial, Outdoor lighting, Third party attachments, Land Rights, and Public Requirements including Municipal, State and NERC / NPCC requirements.

5. 5 Key Drivers of Investment Damage/ Failure Capital expenditures required to replace failed or damaged equipment and to restore the T&D system to its normal operating configuration and capability following a storm or other event. Damage may be caused by storms, vehicle accidents, vandalism or deterioration, among other causes. Other Other - Capital expenditures that do not fit into one of the other categories or used as a placeholder for future reallocation

6. 6 Capital Investments for Reliability

7. 7 Capital Investment Program ProgramDescription Broad Based / Targeted 2009Examples Asset Condition Overhead and underground lines and substation equipment age, performance and condition Broad Based Breaker Replacement – Dewitt Station Replace metal clad at Springfield Station Rathbun Labrador line (Cazenovia & Fenner) upgrade 100 structures Tilden Tully line (Onondaga & Lafayette) 33 structures Sweet Rd. (Manlius) 2+ miles of wire upgrade

8. 8 Capital Investment Program ProgramDescription Broad Based / Targeted 2009 Examples System Capacity & Stability Loading, voltage and stability of overhead and underground lines and substations Targeted New East Malloy Station with 4 feeders Miller St. Station added feeder and replaced bkr Nelson Rd. (Cazenovia).4 mile wire and voltage upgrade Young Rd. (Onondaga).5 mile wire & 22 pole voltage upgrade County Rt 12 (Central Square) rebuild 3 miles wire upgrade Cortland load relief

9. 9 Capital Investment Program ProgramDescription Broad Based / Targeted 2009 Examples Statutory/ Regulatory Program work that is regulatory or statutory driven - New Business, Outdoor lighting, Third party attachments, Land Rights, and Public Requirements including Municipal, State and NERC / NPCC requirements. Broad Based Destiny expansion – UG add switchgear and reconductoring Jefferson Commons – expand UG svc in downtown Syracuse Hamilton Homes, Oswego – New UG primary system to replace 1950’s system. 4 new hotel/motels in Syracuse – new UG svc. Hope Lake water park, Greek Peak – new UG svc.

10. 10 Capital Investment Program ProgramDescription Broad Based / Targeted 2009 Examples Damage/FailureReplace failed or damaged equipment Broad Based As damage or failure occurs OtherOther capital work Broad Based Install 20 pole top reclosures in Central Region

11. 11 Reliability – PSC Indices CAIDI - Hours Actual 2007 Actual 2008 Forecast 2009* Goal 2009 Central Region1.721.481.8382.00 SAIFI - Hours Central Region1.224.8091.061.00 *Forecast as of October 14, 2009 CAIDI — Average time required to restore service SAIFI — # of times the average customer is without power each year.

12. 12 Emergency Response - Electric

13. 13 National Grid Emergency Response Structure  National Grid is migrating its processes and structure to align with National Incident Command Structure –ICS  The Incident Command System:  Is a standardized, on-scene, all-hazard incident management concept  Allows National Grid to adopt an integrated organizational structure to match the complexities and demands of single or multiple incidents

14. 14 Storm Response  Crew Response Utility Mutual Aid Local Region crews Local Division crews Contractors Other NG Division crews Other trained NG Dept. crews from Substations, Metering etc. # Customer Outages

15. 15 Northeast Region Mutual Assistance Group NY Mutual Assistance  ENERGY EAST( NYSEG/RGE)  ORANGE & ROCKLAND  CENTRAL HUDSON  NATIONAL GRID (Upstate NY, New England, Long Island)  NORTHEAST UTIL (CL&P) -- note that NEU is not in NY State but has been grandfathered into our meetings.  CON EDISON  FIRST ENERGY (OH/PA/NJ) Canadian Companies  New Brunswick Power  Hydro One  Hydro Quebec

16. 16 Planning Process In preparation of Forecasted Storms we:  Conduct System and Regional preparation meetings, including meteorologists  Review the number of internal crews, support personnel, contractor tree crews, and outside crews that are available

17. 17 Restoration Process Initial Response  Make it Safe  Respond To Wires Down – Standby As necessary  Respond to Requests of Public Safety Officials  Clear Roadways  Restore Service to critical facilities where ‘quick wins’ can be achieved  Activate plans for mutual aid deployment and staging area for construction

18. 18 RestorationProcess Restoration Process During the Storm  Number one priority is Safety  Severity of the storm will dictate response strategy  Track outage calls within our outage management system to drive most effective restoration strategy  Communications with Public Officials via municipal calls throughout event

19. 19 Municipal Customers Energy Solutions Services  Manage Key Customers  Preparation  Pro-active customer contact to anticipated affected customers  Account Managers or Consumer Representatives  iAvenue – Global Connect Broadcast auto call system.  During the Event  ESS personnel assigned to County Emergency Operation Centers, National Grid Regional Control and Storm rooms  ESS remains in contact with affected customers/municipalities  Critical Care customers are assigned Consumer Representatives to initiate contact

20. 20 Municipal Customers Municipal Conference Calls  VP of Customer Operations & Regional Executive coordinate calls  Information provided:  Damage Assessment  Safety Precautions implemented  Summary of Company resources being used  Estimated Restoration Times  Communities will be canvassed for critical information to help prioritize power restoration  Account Managers & Consumer Representatives responsible for contacting their respective municipalities

21. 21 Other Reliability Programs How Other Reliability Programs Correlate to Storms  Stronger Infrastructure  Poles & Cross-arms  New components & Safeguards  Insulators, cutouts, animal guards  Minimize Tree Related Outages  Cycle Trimming  Uniform Clearances  Hazard Tree Removal All combining to minimize outages during Storms

22. 22 Other Reliability Initiatives How Other Reliability Initiatives Correlate to Storms  Field Crews Improved Performance through  Smarter, more focused approach  Restoration methodology - Applying “switch before fix” ensuring all potential customers are restored prior to making a repair.  One Person Crew program – “Trouble Shooters”  First Responders –Central Region  7 crews, 6 days a week, 24 hour coverage All combining to improve restoration response

23. 23 Storm Response  Storm Updates  Check National Grid Website under New York then Storm Central  https://www1.nationalgridus.com/niagaramohawk/storm/storm.aspx

24. 24 Storm Response