Northeast Utilities Plans for Investment in Transmission Infrastructure

1. Northeast Utilities Plans for Investment in Transmission Infrastructure Leon J. Olivier – President Northeast Utilities Transmission Group Harris Nesbitt Conference Boston, Massachusetts April 7, 2005

2. Safe Harbor Provisions This presentation contains statements concerning NU’s expectations, plans, objectives, future financial performance and other statements that are not historical facts. These statements are forward-looking statements within the meaning of the Private Litigation Reform Act of 1995. In some cases, a listener can identify these forward-looking statements by words such as estimate, expect, anticipate, intend, plan, believe, forecast, should, could, and similar expressions. Forward-looking statements involve risks and uncertainties that may cause actual results or outcomes to differ materially from those included in the forward-looking statements. Factors that may cause actual results to differ materially from those included in the forward-looking statements include, but are not limited to, actions by state and federal regulatory bodies; competition and industry restructuring; changes in economic conditions; changes in weather patterns; changes in laws, regulations or regulatory policy; expiration or initiation of significant energy supply contracts; changes in levels of capital expenditures; development in legal or public policy doctrines; technological developments; volatility in electrical and natural gas commodity markets; effectiveness of our risk management policies and procedures; changes in accounting standards and financial reporting regulations; fluctuations in the value of electricity positions; changes in the ability to sell electricity positions and close out natural gas positions at anticipated margins; obtaining new contracts and anticipated volumes and margins; terrorist attacks on domestic energy facilities; and other presently unknown or unforeseen factors. Other risk factors are detailed from time to time in our reports to the SEC. We undertake no obligation to update the information contained in any forward-looking statements to reflect developments or circumstances occurring after the statement is made.

3. About Northeast Utilities Transmission… Comparative Ranking of NU (Of the 20 largest transmission companies in the 11 Northeastern States) • 4th Largest in terms of miles • 10th largest in terms of Net Transmission Assets

4. Agenda • The need for transmission investment • NU’s programs within ISO-NE’s Regional Transmission Expansion Plan (RTEP) • Major projects and status • Financial benefits to customers and shareholders • Looking beyond the current forecast

5. : Constraint and constrained flow direction The Nation’s Transmission System Is in Need of Significant Additions and Upgrades. FERC’s Electric Transmission Constraint Study identified congestion points that need immediate relief. • A 2001 Edison Electric Industry (EEI) study identified $56B in transmission infrastructure investment needs. • The Federal Energy Regulatory Commission (FERC) has identified $12B that is needed simply to relieve immediate congestion points. • The August 14, 2003 blackout report addresses the need for significant new transmission investments. Transmission Constraints in the Contiguous U.S. Pacific DC Intertie ISO-NE Northeast of Boston NWPA MAPP CA/OR Interface NYISO WY/ID Interface Southwest MI East NY Central IA SW CT Interface PJM ECAR West VA/PJM Interface Southeast PA East KS/MO Interface MAIN RMPA CA/MX Central CA SPP Central MO Southeast West VA Northeast AZ Southern CA AZ/NM/SNV SERC FRCC 5

6. In New England, the Regional Transmission Expansion Plan (RTEP) Identifies Nearly $2.4 Billion in Projects And NU’s part of that transmission expansion program is nearly $1.4 billion. NGrid

7. NU’s RTEP Projects Include… • SWCT – 345 kV and 115 kV facilities • Replacement of the 138 kV Long Island Cable (with LIPA) • Distribution support through new substations • Additional autotransformers to strengthen certain areas by providing new connections to the 345 kV grid • Substation upgrades for enhanced reliability and to meet bulk power facility requirements • Circuit breaker replacements • Protection & controls modifications • Capacitor additions • Dynamic voltage control devices (Statcom completed in SWCT) • Line rebuilds and/or reconductoring for increased capability

8. Transmission Group Asset Strategy for 2005 • NU has committed to a $245 million capital program for 2005. • Five large projects in Connecticut comprise over two-thirds of the capital program: • Bethel-Norwalk $121.9M • Middletown-Norwalk $18.0M • Glenbrook Cables $3.9M • Long Island Replacement Cable $8.3M • Haddam Autotransformer $14.0M • The remaining one-third is comprised of nearly 200 projects in Transmission’s three-state region: • Connecticut $42.5M • Massachusetts $12.5M • New Hampshire $23.9M $166.1M $78.9M

9. The Need: An Adequate Transmission System Reliability Concerns • An inadequate system serves 50% of Connecticut’s load • New England’s 345kV system stops at SWCT’s border • Does not meet national reliability standards • SWCT noted as a major reliability concern at federal, regional and local levels Economic Impacts • Rising potential for wide area blackouts • Relies on old, costly and inefficient generation plants • Threat to the area’s economy with increasing congestion costs and potential for market power • Limits the potential of New England’s competitive wholesale markets 50% 345-kV 115-kV SWCT improvements have been a top priority in each of ISO-NE’s last four regional transmission expansion plans.

10. 345-kV 115-kV Proposed Upgrades to the SWCT Transmission System Existing Bethel-Norwalk 345 kV Underground & Overhead $300-350 Million 21 miles 345kV (56% underground) 10 miles 115kV (100% underground) Projected in-service date: Dec 2006 Middletown-Norwalk 345 kV Underground & Overhead $670-794 Million (NU 80% Share) 69 miles 345kV (35% underground) 57 miles 115kV (1% underground) Projected in-service date: 2009

11. Financial Implications For customers: • Improved reliability – creates secure supply, quality service and stable environment for production and growth • Lower levels of congestion and less LICAP exposure results in lower bills • Increased access by competitive generators should lower costs For shareholders: • Increases in rate base from investments drive earnings growth • $500 million of current rate base • $1 billion - $1.5 billion of capital spending projected in 2005-2009 • Siting for our large projects is progressing • Our cost recovery mechanisms are largely defined

12. Transmission Capital Expenditures* NU’s Transmission growth has already begun. $ Millions * Spending levels depend on final level and timing of all projects.

13. We Believe that a Significant, Continuing Stream of Investments in Transmission is Sustainable • Line rebuilds to replace aging, low capacity conductor • Voltage conversions from 69 kV to 115 kV • Additional 345 – 115 kV autotransformers • New 115 and 345 kV lines (overhead and underground) to meet load growth and to increase transfer capability across constrained interfaces • New substations to meet load growth