NECPUC Gas panel

Susan Fleck

National Grid

June 17, 2014

2

Our US Network

3

Our Natural Gas Customers

Customers: We serve 3.5 million natural gas customers across three States (MA,

NY & RI), in both urban and suburban areas We have added approximately 120,000 customers since 2008 and

forecast to add an additional 260,000 customers in the next ten years Infrastructure:

Over the last five years, we invested a total of $1.2 billion dollars replacing mains and services that are made up of older, leak prone materials

Our spend in this area will increase by 45% to $2.2 billion dollars over the next five years

4

The Landscape

Nationally: Increasing public climate change interest and passion Desire for increasing energy efficiency Abundance of domestic natural gas supplies Increasing public safety concerns

And in the Northeast: National Grid is the largest natural gas infrastructure company We have one of the oldest networks in the nation We have an opportunity to convert customers from oil to gas

5

OTHER16

0%

CAST IRON5,52616%

UNPROT'D STEEL5,69516%

PROT'D STEEL9,10826%

PLASTIC14,47742%

PLASTIC460

53%

OTHER1

0%

PROT'D STEEL

33939%

UNPROT'D STEEL

445%

CAST IRON

233%

National Grid - US

34,821 Miles

PHMSA Average LDC867 Miles

Main InventoryUS Comparative Summary

6

OTHER16

1%

CAST IRON

831 26%

UNPROT'D STEEL

508 16%

PROT'D STEEL

596 19%

PLASTIC1,227 38%

Massachusetts

11,021 Miles

Rhode Island3,179 Miles

Main Inventory

PROT'D STEEL2,66924%

PLASTIC4,71843%

CAST IRON2,19420%

UNPROT'D STEEL

1,44013%

7

1,200

1,400

1,600

1,800

2,000

2,200

Mile

s

UPST Main 2,025 1,910 1,856 1,763 1,679 1,579 1,500 1,441

'06 '07 '08 '09 '10 '11 '12 '13

MA Unprotected Steel Main Inventory

8

1,600

1,800

2,000

2,200

2,400

2,600

Mile

s

CI Main 2,516 2,497 2,478 2,437 2,380 2,330 2,260 2,194

'06 '07 '08 '09 '10 '11 '12 '13

MA Cast Iron Main Inventory

9

400

500

600

700

800

Mile

s

UPST Main 711 679 664 674 592 580 534 508

'06 '07 '08 '09 '10 '11 '12 '13

RI Unprotected Steel Main Inventory

10

600

700

800

900

1,000

Mile

s

CI Main 908 900 896 885 878 875 859 831

'06 '07 '08 '09 '10 '11 '12 '13

RI Cast Iron Main Inventory

11

Historical & Future Capital Spend

Millions

12

Challenges

Expansive infrastructure replacement programs like National Grid’s come with many challenges.

Differing and often times conflicting political pressures faced by utility commissioners in rate and safety areas

City and town rules and regulations

Availability of construction materials

Availability of qualified and trained workers

Community/public opinion and disruptions

Customer ability to foot the bill

13

Next Steps

Working with our suppliers and contractor communities: Develop new sources.

Working with our cities and towns: Develop shared understanding and goals.

Working within our states: Develop shared understanding of state and National Grid strategic

priorities, how they connect and diverge. Develop infrastructure investment strategies and share best practices.

Working with other leading utilities and industry associations to: Develop / identify / share methodologies and technologies to repair

and replace infrastructure. Develop and deploy new ways to detect and reduce emissions.