Algonquin Power & Utilities Corp. – Consolidated Financial Statements ALGONQUIN POWER & UTILITIES CORP.  Notes to the Consolidated Financial Statements  December 31, 2012 and 2011   (in thousands of Canadian dollars except as noted and amounts per share)  Prior to their acquisition by Liberty Utilities, EnergyNorth and Granite State were named as  potentially responsible parties for remediation of several sites at which hazardous waste is  alleged to have been disposed as a result of historic operations of Manufactured Gas Plants  (“MGP”) and related facilities. The Company is currently investigating and remediating, as  necessary, those MGP and related sites in accordance with plans submitted to the NHDES.  The Company believes that obligations imposed on it because of those sites will not have a  material impact on its results of operations or financial position. The Company estimates the remaining undiscounted, unescalated cost of these MGP-related  environmental cleanup activities will be $59,862 (U.S. $60,168) which at a discount rate of  3.5% represents the recorded accrual of $56,587 at December 31, 2012. This amount reflects  the approval from the NHDES on December 10, 2012 of a Conceptual Remedial Design  Report submitted to NHDES for removal of tar-impacted media at the Liberty Hill Road Site in  New Hampshire. The NHDES approval at Liberty Hill Road Site reduced the overall cost  estimate and consequently the Company withdrew its pending appeal. Remediation costs  estimates for each site may vary, depending upon changing technologies and regulatory  standards, selected end use for each site, and actual environmental conditions encountered. By rate orders, the Regulator provided for the recovery of actual expenditures for site  investigation and remediation over a period of 7 years and accordingly, at December 31, 2012  the Company has reflected a regulatory asset of $59,789 for the MGP and related sites. Estimated cash flows for site investigation and remediation costs in the next five years and  thereafter are as follows:  21.  Commitments and contingencies  a) Contingencies ii) The normal ongoing operations and historic activities of the Company are subject to various  federal, state and local environmental laws and regulations and are regulated by agencies  such as the United States Environmental Protection Agency and the New Hampshire  Department of Environmental Services (“NHDES”). Like most other industrial companies,  the gas and electric distribution utilities generate some hazardous wastes. Under federal  and state Superfund laws, potential liability for historic contamination of property may be  imposed on responsible parties jointly and severally, without fault, even if the activities were  lawful when they occurred. In the case of regulated utilities these costs are often allowed in  rate case proceedings to be recovered from rate payers over a specified period. 2013  $ 2,433 2014  13,316 2015  18,836 2016  14,236 2017  996 Thereafter to 2046  10,045 $ 59,862 2012 Annual Report 125