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Hydro One Prices Initial Public Debt Offering

TORONTO, May 25, 2000 - Hydro One Inc. today announced the pricing of its initial public offering in Canada and the United States of $1 billion principal amount of debentures. The debentures consist of three series, as follows:

• Series 1, $200 million principal amount of senior unsecured debentures due 2005, will bear interest at a rate of 6.94%, payable semi-annually.
• Series 2, $400 million principal amount of senior unsecured debentures due 2010, will bear interest at a rate of 7.15%, payable semi-annually.
• Series 3, $400 million principal amount of senior unsecured debentures due 2030, will bear interest at a rate of 7.35%, payable semi-annually.

"We are extremely pleased with the response to this, our first offering of Hydro One securities," said Eleanor Clitheroe, President and Chief Executive Officer of Hydro One. "We look forward to a strong, long-term relationship with our debenture holders, characterized by open lines of communication."

The offering is being underwritten by a syndicate of underwriters co-led by Scotia Capital Inc. and BMO Nesbitt Burns Inc. and including Merrill Lynch Canada Inc., RBC Dominion Securities Inc., CIBC World Markets Inc., TD Securities Inc., Goldman Sachs Canada Inc. and National Bank Financial Inc. U.S. broker-dealer affiliates of these underwriters are participating in the offering of debentures in the United States.

The closing of the offering is scheduled for June 1, 2000. Net proceeds of the offering will be used to repay a portion of the Company's indebtedness to Ontario Electricity Financial Corporation. This indebtedness was incurred by Hydro One in connection with its acquisition of the electricity transmission, distribution and energy services businesses of Ontario Hydro as part of the reorganization of Ontario Hydro in 1999.

Hydro One Inc., through its subsidiaries, is principally engaged in electricity transmission, distribution and energy services businesses. Through a wholly owned subsidiary, Hydro One Inc, owns and operates the largest transmission and distribution system in Ontario and one of the 10 largest in North America.

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For more information, please contact:

Ian Chadsey Director, Investor Relations Hydro One 416-345-6136