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Hydro One Facilitates OEFC Debt Sale

TORONTO, January 24, 2003 - Hydro One Inc. announced today that Ontario Electricity Financial Corporation (OEFC) intends to sell some or all its Hydro One debt in the Canadian public debt markets, likely commencing in the first quarter of 2003. OEFC holds approximately $2.53 billion of Hydro One debt maturing between 2003 and 2007, with a weighted average term to maturity of approximately two years.

In order to facilitate the sale, Hydro One has agreed in principle with OEFC to restructure some or all of the Hydro One debt held by OEFC. It is anticipated that the approximately $2.53 billion of existing debt with a weighted average interest rate of approximately 8% would be exchanged for approximately $2.75 billion of debt with a weighted average interest rate of approximately 4%. The actual principal amount and interest rate of the restructured notes would be based upon market interest rates at the time of execution of a definitive agreement. This debt restructuring would result in lower cash interest payments for Hydro One from 2003 through 2007 and a corresponding increase in the principal amount of the debt payable at maturity. The maturity dates would remain essentially unchanged as would the market value of Hydro One's debt obligations to OEFC.

For Hydro One's current debt maturity schedule visit link: www.HydroOne.com/en/investor_centre/debt_information/

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For further information, please contact:

Anne Creighton,
Director, Corporate Communications
416-345-6072