To: All our Valued Customers

RE: Harmonized Sales Tax & your Hydro Bill

On July 1, 2010 the Ontario Government is implementing a change to the Provincial tax system. The new Harmonized Sales Tax (HST) will replace the current GST and PST, and this will have an impact on your electricity bills. Currently Festival Hydro Inc. Customers are charged 5% GST on their electricity consumption in accordance with regulations. For electricity consumption that occurs after July 1st, customers will be charged 13% HST in line with the new tax system being implemented by the Province of Ontario.

Details and information explaining the rationale for the HST is available from the Ontario Ministry of Revenue website at: www.rev.gov.on.ca

Or the Canadian Revenue Agency at: www.cra-arc.gc.ca

Or by calling the provincial call centre toll free number at 1-800-959-5525.