Power offers TransCanada  significant potential for growth over the next five years. CORE STRENGTHS GENERATION OF POWER Grow in Markets We Know:  The northern tier is one of the fastest growing areas of North America, with a pro- jected increase in total power generation of approximately ten per cent by 2005. Utilizing our expertise in cogeneration and our experience with diversified fuel sources, TransCanada will continue to build, acquire and invest in competitive facilities and relationships, growing our balanced portfolio of both gas-fired and non gas- fired power plants in regions where we have existing competitive advantages. Optimize Reward Versus Risk:  Our objective is to grow our power business in a manner that contributes to con- tinued earnings growth. That means applying business models that benefit from, and support, our strong balance sheet. It means pursuing projects that fit our desired risk profile – a focus on low-cost supply, low volatility, stable returns and longer-term contracts. Our financial strength allows us to move quickly to act on quality opportunities as they arise. Maximize Returns Through a Broad Suite of Power Products:  Growth of our power business will be fueled by a combination of our physical assets and our trading and marketing capability. By offering our customers value- added power products and services, we maximize their returns while reducing business risk. By proactively managing our own power portfolio, we gain valuable market knowledge, enabling us to optimize the value of our assets and contribute to continued growth and shareholder value. Commitment to Excellence:  TransCanada’s power business is characterized by a commitment to industry-leading performance, as evidenced by our highly efficient generating fleet of turbines that operates at average availability exceeding 96 per cent. We have a strong management team with a proven track record in maximizing value from existing assets and in identifying new opportunities that leverage our skills and compet- itive strengths. Broad Understanding of Continental Markets:  We have extensive knowledge of North American energy markets, underscored by an in-depth understanding of our core markets in the northeastern U.S., Ontario and the Pacific Northwest, and excellent relationships with industrial customers. As an active participant in the deregulation of the Alberta power sector, we are now one of the largest power suppliers and marketers of power to industrial cus- tomers in the province. Our significant experience with deregulation there and in New England will serve us well in seizing opportunities in newly opening markets. GROWTH STRATEGY AND OPPORTUNITIES Ability to Structure Deals and Manage Risk:  In today’s power markets, the ability to structure deals and manage risk is critical to mitigating volatility and uncertainty for our industrial customers as well as our shareholders. Our deal structuring and risk management skills have been a key element of our success, complemented by marketing and trading operations that enable us to take advantage of market volatility while creating stable and predictable cash flow. TRANSCANADA 12