Rating Agency Meetings

1

Rating Agency Meetings

APRIL 7, 2011

2

Key Achievements Over the Past Year

• Merger with NSTAR negotiated, announced and several key approvals secured

• 2010 earnings, cash flows finished ahead of forecast; 2011 plan above consensus

• Fair conclusions to three distribution rate cases

• Key endorsements of NEEWS, NPT projects

• Revolving credit agreements extended to September 2013 at full $900 million level

• Standalone financial metrics, risk profile, record of strong execution justifies higher ratings

3

$15.8

$164.3$159.2

$330.0

($9.3)

$381.6*

$8.3

($10.7)*

$177.8

$206.2

($25)

$25

$75

$125

$175

$225

$275

$325

$375

$425

2009

2010

2010 Results

Distribution and Generation

Transmission Parent/Other Competitive Total

Ear

nin

gs

Fo

r C

om

mo

n In

Mill

ion

s

29.5%

8.2%

15.6%

*Excludes benefit of $15.7 million tax settlement and after-tax merger costs of $9.4 million

4

2010 Results vs. April 2010 Forecast

$millions NU Consolidated CL&P PSNH WMECO Yankee Gas

Forecast Actual Forecast Actual Forecast Actual Forecast Actual Forecast Actual

Earnings for common $347 $388 $239 $238 $84 $90 $25 $23 $32 $33

Ending common equity

$3,784 $3,811 $2,335 $2,397 $949 $926 $321 $358 $367 $370

Ending total debt $5,149 $4,909 $2,683 $2,589 $919 $914 $366 $364 $398 $363

Interest ex. RRBs $246 $217 $134 $130 $39 $37 $19 $18 $22 $18

FFO before working capital changes and after RRB payments

$736 $955 $482 $573 $143 $158 $48 $51 $67 $96

* Excludes $57 million of WMECO long-term debt offset by spent nuclear fuel trust assets** Excludes $288 million of equity associated with acquisition premium

* *

**

*

**

*

Better than forecast Similar or weaker than forecast

5

2009 Results vs. April 2009 Forecast

$millions NU Consolidated CL&P PSNH WMECO Yankee Gas

Forecast Actual Forecast Actual Forecast Actual Forecast Actual Forecast Actual

Earnings for common

$305 $330 $191 $211 $68 $66 $24 $26 $29 $21

Ending common equity

$3,534 $3,578 $2,373 $2,373 $788 $727 $243 $247 $336 $331

Ending total debt $4,951 $4,602 $2,589 $2,582 $861 $863 $325 $384 $455 $362

Interest ex. RRBs $248 $237 $140 $137 $40 $33 $15 $15 $23 $22

FFO before working capital changes and after RRB payment

$752 $827 $430 $492 $137 $157 $45 $69 $63 $71

* Excludes $57 million of WMECO long-term debt offset by spent nuclear fuel trust assets** Excludes $288 million of equity associated with acquisition premium

* *

**

*

**

*

Better than forecast Similar or weaker than forecast

6

$1.59

$0.775$0.825

$1.91 $1.86**

$2.16*

$2.35*

$0.95$1.025

$1.10

48.7%

44.4%

49.7%

47.5% 46.8%

$0.00

$0.50

$1.00

$1.50

$2.00

$2.50

2007 2008 2009 2010 2011 Est.

0.0%

10.0%

20.0%

30.0%

40.0%

50.0%

60.0%

NU’s Payout Ratio is Conservative and Aligned With the Growth Story and Capital Requirements

Payout ratiosEPS Dividends per share

*Excludes merger costs and 2010 NU Parent tax settlement**Excludes litigation settlement charge

7

Cash Flows Continue to Rise Significantly

$234

$424

$745

$833

$962

$389*

$0

$100

$200

$300

$400

$500

$600

$700

$800

$900

$1,000

2006 2007 2008 2009 2010 2011E

In M

illio

ns

Net Cash Flows From Operations After Repayment of RRBs

*Excludes payment of $400 million of taxes due to November 2006 generation sale

37.5% CAGR

8

Enterprise Risk Management (ERM) Update

ERM is in its sixth year of implementation at NU

Internal Risk Assessment Teams identify, discuss and assess risks; Accountability for risk mitigation remains with the businesses and corporate shared services functions

Regular reports are made to committees of the Board of Trustees

ERM facilitates a fully functioning Risk and Capital Committee that integrates risk with capital expenditure decisions and evaluates key risks of the NU businesses

ERM principles are integrated into strategic planning and budgeting processes, with strategic and operating plans “risk rated”

Board of Trustees

Chief Executive

Officer

Chief Financial

Officer

DirectorCorporate

ERM

Risk & Capital

Committee

Distribution/Generation

Risk Controller

Corporate Shared ServicesRisk Controller

TransmissionRisk

Controller

Select EnergyRisk

Controller

Executive VicePresident

Operations

Chair RiskAssessment

Teams

RiskAnalyst

Corporate ERM Group

9

NU’s Risk and Capital Committee (RaCC)

The RaCC is a senior-level Capital Committee with a governance role to ensure that

capital projects are reviewed with a risk perspective.

Only the RaCC can authorize spending on capital projects or programs over specified $

thresholds, which institutionalizes a focus on risk identification and mitigation.

ERM conducts risk workshops to assist project teams with evaluating capital project risks and also ensures that the risks have

mitigation plans that are updated to the RaCC quarterly

The RaCC is also the company’s Risk Committee, where NU’s key financial,

operational, and strategic risks are reviewed and discussed.

10

Key Themes for March 2011 Update of Strategic Risks

Energy Policy and Regulation: Yankee Gas rate case is underway in 2011. Elections brought significant changes and a high level of

focus on energy policy in the region, including a proposal for restructuring the utility regulatory commission in CT. Several state commissioners are up for re-appointment in 2011.

Uncertainty surrounding EPA regulation and enforcement increases risk in our generation business.

We are also watching national policy that could impact transmission cost allocation and competition.

Revenues: Weather has positively impacted sales; a focus on

renewables and distributed generation continues.

Capital Deployment. NEEWs and Northern Pass transmission projects are

moving forward.

Financial: Interest rates remain low; assets are performing well in the

pension plan.

Business Climate, Customer Satisfaction and Reputation The business climate, particularly in CT, remains challenging due

to continued economic weakness and new legislative proposals that may bring further harm. There is continued focus on customer satisfaction with increased staffing, improved technology and processes, and enhanced storm restoration efforts.

Information Technology Technology and security are monitored to avoid disruptions of

operations and information security breaches, as NU companies increasingly use new technologies and data warehousing. There are challenges recognized with handling, managing and securing data.

Compliance: NERC audits have been very positive; reliability compliance

department is meeting its objectives. OSHA is adopting a more aggressive approach to enforcement.

Environmental: Historical environmental sites in MA continue to be addressed.

There is a strong enforcement mindset at the federal level with respect to environmental regulation.

11

NU-NSTAR Merger Status

12

A Compelling Combination – Creates Largest Utility Company in New England

Significant transmission investment

opportunities combined with balance sheet

strength provides for substantial growth

potential

Larger, more diverse and better positioned

to support economic growth and

renewables in New England

Accretive to earnings in Year 1 and

provides enhanced total shareholder return

proposition

Enhances service quality capabilities to the

largest customer base in New England

Highly experienced and complementary

leadership team with proven track recordNSTAR Electric Service AreaNSTAR Gas Service Area

Northeast Utilities Electric Service AreaNortheast Utilities Gas Service Area

ME

NY

PA

VT

NH

NJ

MA

RI

Combined Service Territory

13

Key Merger Terms

Timing / Approvals: Expected to close in the second half of 2011

Headquarters: Dual – Hartford and Boston

Company Name: Northeast Utilities

Consideration: 100% stock

Exchange Ratio: 1.312 shares of Northeast Utilities per NSTAR share

Pro Forma Ownership: 56% Northeast Utilities shareholders 44% NSTAR shareholders

Pro Forma Dividend: At close, dividend increase for Northeast Utilities shareholders

Dividend parity for NSTAR shareholders

Governance: Chuck Shivery to be non-executive Chairman Tom May to be President and CEO 14 Board members

7 nominated by Northeast Utilities including Chuck Shivery 7 nominated by NSTAR including Tom May

Balanced Terms and Governance

14

Executive Management Organization

Tom MayPresident & Chief Executive Officer

Greg ButlerGeneral Counsel

David McHaleChief Administrative

Officer

Lee OlivierChief Operating

Officer

Christine CarmodyHuman Resources

Jim JudgeChief Financial Officer

Joe NolanCorporate Relations

Chuck ShiveryNon-Executive

Chairman

15

NU-NSTAR Merger Status

• NU and NSTAR shareholders approved the merger by needed two-thirds votes on March 4

• Hart-Scott-Rodino waiting period expired in February without objection

• FCC review complete without objection

• FERC, NRC reviews pending

• MA DPU amended standard of review. New schedule calls for evidentiary hearings to begin July 6

• CT DPUC draft decision disclaimed jurisdiction. Now awaiting final decision and monitoring pending legislation

• NHPUC waiting for decision on jurisdiction

• Waiver sought in Maine

16

Distribution and Generation Segment

17

Distribution and Generation segment Achieved Several Milestones in Past 12 Months

• Rate cases completed for all three electric companies

• Rate case outcomes are moving realized earnings closer to allowed returns –

approximately 9% Distribution ROEs projected at each distribution segment in

2011

• Capital investment plans supported at CL&P and PSNH

• Yankee Gas rate case filed in January, decision due in June

• Strong cost control and lower uncollectible improved performance

• Clean Air Project now more than 80% complete and below budget – expected to

enter commercial operation by mid-2012

18

$27.1

$47.5

$105.4

$19.9

$12.3

$41.4

$70.0

$21.0$16.7

$74.0

$32.7

$10.1

$69.3

$94.1

$74.2

$32.0

$0.0

$20.0

$40.0

$60.0

$80.0

$100.0

$120.0

CL&P PSNH WMECO Yankee Gas

2008 2009 2010 2011 Projected

Ne

t In

com

e in

mill

ion

sImproving Earnings in Distribution/Generation Businesses

19

Final Resolution of All Three Electric Rate Cases

• Five-year settlement approved by NHPUC on 6/28/2010

• $45.5 million increase on 7/1/10 in addition to 8/1/09 temporary increase of $25.6 million

• $2.9 million decrease on 7/1/11

• 2012 & 2013 projected increases of $9.5 million & $11.1 million

• Authorized ROE remains 9.67% (2010 distribution/ generation ROE was 10.2%)

• Recovery of ice storm costs over 7 years

• Final decision 6/30/2010

• $63.4 million increase effective 7/1/10


• Authorized 9.4% ROE at 6/30/10 (2010 ROE was 7.9%)

• 49.2% equity in capital structure

• Benefits from full RRB amortization and lower commodity prices resulted in 7.8% standard service rate cut

• Initial increase deferred until 1/1/11

• Capex plan approved

PSNH CL&P• Final decision 1/31/11


• Authorized 9.6% ROE (2010 ROE was 4.6%)

• Revenue decoupling approved

• Distribution capital program reduced by $20 million/year from requested level

• $2.1 million write-off taken in fourth quarter 2010

WMECO

20

$307 $337 $320 $317 $329 $336

$83$133

$84

$113 $116 $127

$132

$132

$10

$22$9 $5

$5

$5

$33

$36$39 $39

$40

$177$112

$52 $52

$29

$1

$40$29

$0$50

$100$150$200$250$300$350$400$450$500$550$600$650$700$750

2010Actual

2011 2012 2013 2014 2015

PSNH - Generation ($274M total)

WMECO - Distribution ($194M total)

WMECO - Generation ($46M total)

PSNH - Distribution ($621M total)

CL&P - AMI/Smart Grid ($217M total)*

CL&P - Distribution ($1,639M total)

In

Mill

ions

Electric Distribution and Generation Capital Expenditures – By Company

2011-2015 Projected Electric Distribution and Generation Spending$3 Billion

$611

$675$618

$541$536

$620

*Total AMI-related capex through 2016 expected to be approximately $300 million

2011 – 2015 Capital Expenditures

21

NU Generation Strategy

WMECO Solar InitiativeWMECO Solar InitiativePSNH Generation Business PlanPSNH Generation Business Plan

Installation of 6 MW solar projected by 2012

Estimated cost: $41 million

Completed 1.8 MW of solar at first site in Pittsfield, MA in October 2010

4.2 MW site in Springfield, MA identified for second project

Constructive regulatory model – fully tracking, segmented rate base

Five-year strategy preserves existing 1,200 MW New Hampshire fleet

Completes the Merrimack Scrubber Estimated cost reduced from $457

million to $430 million $296.5 million capitalized at 12/31/10 Ahead of schedule: 82% complete as

of 2/28/11 Assesses additional growth opportunities

in renewables

22

Yankee Gas Capital Expenditures

$25 $30$48 $50 $51 $52

$30$37

$31 $30 $31 $33$13

$16

$20 $20 $21 $22

$27

$30

$13$26$26

$0$10$20$30$40$50$60$70$80$90

$100$110$120$130$140$150

2010 Actual 2011 2012 2013 2014 2015

Aging Infrastructure Basic Business

Peak Load / New Business WWL

Gas supply infrastructure

2011-2015 Projected Yankee Gas Capital Spending$587 Million

$95

$120$129$126

$99

$113

In

Mill

ion

s

23

• Project began in April 2010; completion expected by November 2011

• Fills gaps in supply portfolio and eliminates system constraint in Cheshire area

• Increases vaporization capacity of Waterbury LNG project

• Projected cost reduced from $67 million to $57.6 million; $26.6 million invested in 2010

• Key elements of current Yankee Gas rate case

$29.1 million increase effective 7/1/11

$10.3 million increase effective 7/1/12

Maintain current 10.1% ROE

Waterbury to Wallingford Project to Add Needed Supply for System Demand

24

Transmission Segment

25

$18.0

$145.1

$23.9

$6.0

$16.7

$115.6

$9.5

$136.8

$13.0$20.7

$143.9

$23.9

$0.0

$20.0

$40.0

$60.0

$80.0

$100.0

$120.0

$140.0

$160.0

CL&P PSNH WMECO

2008 2009 2010 2011 Projected

Mill

ion

s

Transmission Earnings Continue to Rise

26

Southwest Connecticut Reliability: Projects Complete

1

Connecticut Borders (MA, RI):NEEWS Projects Under Way2

Transmission Business Strategy: Major Initiatives Expanding Across Wider New England Geography

NPTHVDC

3 Northern Pass Transmission (NPT) Line between Quebec and New Hampshire

Renewables & Clean Energy (ME/NH/VT):Projects in Development/High Wind potential areas

4

Potential Wind Sites

´

27

NEEWS Projects AdvanceCurrent Status Report

Greater Springfield Reliability Project

• Received siting approval in CT and MA

• Substation construction commenced in MA in Dec. 2010 and overhead construction in February 2011

• Commence overhead construction in CT in early 2012

• Project in-service: late 2013

Interstate Reliability Project

• Joint project with National Grid (NU in CT; NGrid in MA & RI)

• ISO-NE confirmed need date in August 2010

• File siting application in CT in late 2011

• Siting decision in CT in mid/late 2013

• Commence construction: late 2013/early 2014

• Project in-service: late 2015

• FERC approved ROE of 12.89%, 100% CWIP in rate base and recovery of abandoned costs in 2008

SPRINGFIELD

HARTFORD

345-kV SubstationGeneration Station345-kV ROW

115-kV ROW

Central ConnecticutReliability Project

InterstateReliability Project

Greater SpringfieldReliability Project

Central Connecticut Reliability Project

• Awaiting completion of ISO-NE’s reassessment of need and need date

• Project milestones estimated 12 months behind IRP

28

Northern Pass Transmission – a $1.1 Billion Capital Investment

´

• To be owned by Northern Pass Transmission LLC - NU (75%) and NSTAR (25%)

• 1,200 MW transfer capability

• Northern terminus at Des Cantons (Québec), southern terminus in Franklin (New Hampshire)

• Québec terminal will convert the power from AC to DC (rectifier)

• US terminal will convert the power from DC to AC (inverter)

• 345kV AC leg from Franklin to Deerfield, NH

• Capital cost estimate for US segment: $1.1 billion

• TSA signed in October 2010 and accepted by FERC on February 11, 2011

• Permitting process began October 14, 2010 with U.S. DOE application

• PPAs under discussion

Des Cantons

HVDC Line

HVDC Converter Station

345-kV Line

Existing Deerfield Substation

Deerfield

Franklin

29

Milestone Milestone Date

Initial FERC filing for declaratory order Dec 2008

FERC declaratory order received May 2009

Transmission Service Agreement (TSA) signed Oct 2010

ISO Technical Approval application filed Oct 2010

DOE Presidential Permit application filed Oct 2010

TSA FERC filing Dec 2010

FERC accepts TSA Feb 2011

Execute Term Sheets for EPC Q2 2011

New Hampshire Siting (SEC) application filed Q4 2011

Begin long lead time material procurement Q4 2011

Complete siting approvals Q1 2013

Begin Construction 2013

In-Service Date Late 2015

Project cost - (U.S. side) $ 1.1 Billion

Northern Pass Transmission - Project Milestones as of 3/1/11

30

Key TSA Terms

• 40 year agreement governs the development, construction and operation of the NPT line

• Parties are NPT and HQ Hydro Renewable, a newly created subsidiary of HQ

• Payments begin with commercial operations; AFUDC accrues to rate base

• Payments based on projected cost-of-service calculation with annual true-up; they do not vary with HQ’s utilization of line

• 50-50 debt-equity capital structure with 12.56% ROE during construction and 142 bps above ISO-NE Tariff ROE during commercial operation

• HQ likely to provide construction debt financing; permanent financing after commercial operation

• HQ has numerous termination rights (e.g., cost escalation); NPT is reimbursed for all costs incurred if these rights are exercised

• HQ guarantees all amounts owed under the agreement; guaranty is capped at a fixed amount calculated based on project cost

31

NEEWS projects ramping up

2001-2015 Transmission Capital Expenditures

$0

$100

$200

$300

$400

$500

$600

$700

$800

2001

2002

2003

2004

2005

2006

2007

2008

2009

2010

2011

2012

2013

2014

2015

Base Reliability Major Southwest CT NEEWS Northern Pass

Historic Forecast

In M

illio

ns

$2.9 Billion $2.8 Billion

NU’s share of NEEWS project

estimated at $1.449 billion

$845 million of additional forecasted

projects

$261 Million

Northern Pass HVDC Line to

Canada

US portion estimated at $1.1 billion with $830

million NU ownership share

Successful completion of

SWCT projects

SWCT projects total $1.6 billion

32

NU Actual and Projected Transmission Year-End Rate Base

$2,099 $2,178 $2,234 $2,394 $2,552

$315 $341 $360 $406 $406$505

$183 $269 $459$650 $730

$803

$2,149 $2,114

$540

$834

$830

$0

$500

$1,000

$1,500

$2,000

$2,500

$3,000

$3,500

$4,000

$4,500

$5,000

2009Actual

2010Actual

2011 2012 2013 2014 2015

CL&P PSNH WMECO Northern Pass

Transmission Rate Base

CAGR of 10.5%

In M

illio

ns

$2,597$2,759

$3,234$3,370

$3,733

$4,725

*100% CWIP assumed for NEEWS projects

$2,933

**NU share of this project is depicted as traditional rate base which accrues AFUDC during construction

*** *

33

North-South Interface:80% of NE electric load is below this line

Vast majority of potential onshore renewables (wind)

are in northern NE

Efforts Under Way to Bring Northern New England Wind Generation to Market

• New England RPS requirements are 21% by 2020, and existing resources provide only 6%

• Complement current ISO-NE regional planning and potential FERC changes

• Create efficiencies by optimizing multiple wind sites and required transmission

• Get clean renewable energy to New England’s load sites

• Utilize a “beneficiary-pay” model that provides transparency for customers and regulators

NU, NSTAR, National Grid, and United Illuminating working collectively on this model

34

$2,597 $2,933 $3,234 $3,370 $3,733$4,725

$3,303$3,670

$3,912$4,171

$4,516

$4,893

$407$405

$758$773

$773

$763

$691$682

$743

$756$790

$2,759

$3,488

$426

$847

$969

$0

$2,000

$4,000

$6,000

$8,000

$10,000

$12,000

2009Actual

2010Actual

2011E 2012E 2013E 2014E 2015E

Transmission Distribution Generation Yankee Gas

Capital Program Benefits Customers and Produces Attractive Rate Base Growth

$7,334

$8,660

$7,772

$9,104

Rat

e B

ase

in M

illio

ns

Actual and Projected Total

Rate Base 2009-2015

CAGR of 8.4% (using 2009 as base year)

$6,998

$9,869

Projected Electric Distribution

CAGR of 6.8%

Projected Transmission CAGR of 10.5%

$11,350

Projected Generation CAGR of 11.0%

Projected Natural Gas Distribution

CAGR of 5.8%

35

Credit Overview

36

NU’s Improving Credit Story

Northeast Utilities’ improving credit story has been evidenced by the positive response it has seen from the investor community

• Northeast Utilities 2010 actual and 2011 projected credit metrics have improved significantly from last April• 2010 actual FFO / Debt was 18.5% versus the 14.7% budgeted last April• 2011 budgeted FFO / Debt is 18.6% versus the 11.7% projected last April• 2010 actual FFO / Interest Expense was 5.1x versus the 3.8x budgeted last April• 2011 budgeted FFO / Interest is 4.8x versus the 3.1x projected last April

• Northeast Utilities 5-year CDS has outperformed the broader market over the past year• In fact, NU CDS trades at a lower spread than all of its utility peers as well as the broader credit index (CDX.IG)

• NU has also outperformed its closest peers, tightening 18% from June 2008 versus a peer average of 16%

• Both the holding company and its subsidiaries have seen a very strong secondary market performance, particularly

after the announcement of the NU-NSTAR merger• The CL&P 10-year benchmark note has outperformed the broader market, tightening 46 bps more than the 10-

year Single-A utility index over the past 6 months• The benchmark has also outperformed a majority of its peer set over the period

• Evidence suggests NU’s subsidiaries have historically priced at new issue rates more in-line with their higher-rated

peers

• Indicative new issue pricing has decreased dramatically over the past year• Current indicative rates for CL&P and NU holding company better than the Single-A and BBB utility index,

respectively, despite slightly lower ratings

New Issue Pricing

Secondary

Bond Spreads

CDS

Improving Credit Metrics

37

25

50

75

100

125

150

Mar-10 Jun-10 Sep-10 Dec-10 Mar-11

Spread (bps)

NU (Baa2/BBB-) CDX.IGAEP (Baa2/BBB) DTE (Baa2/BBB-)TECO (Baa3/BBB-) PEPCO (Baa3/BBB)

Despite maintaining its current ratings, Northeast Utilities CDS has outperformed similarly rated peers

5-Year NU CDS vs. Index and Peers (LTM)

-28%

-3%

-12% -10%

-39%

-18%

-50%

-40%

-30%

-20%

-10%

0%

10%

NU CDX.IG AEP DTE TECO PEPCO

Change (%)

% Change Last 12 Months

5-Year NU CDS vs. Higher Rated Peers

50 5058 63

70

95

47

0

25

50

75

100

DUK(Baa2/BBB+)

NU(Baa2/BBB-)

PGN(Baa2/BBB)

D(Baa2/A-)

DPL(Baa1/BBB+)

SO(Baa1/A-)

CDX.IG

___________________________Source: Bloomberg, Markit.

Current Spread (bps)

Northeast Utilities CDS Spread Performance

10/18/10: NU / NST Merger Announced

38

Connecticut Light & Power secondary spreads have tightened dramatically over the past two years, outperforming the broader utility space and most peers

50

75

100

125

150

Jun-09 Oct-09 Feb-10 Jun-10 Oct-10 Feb-11

Spread (bps)

10-Year A Utility Index CL&P 5.5 '19

CL&P 5.5% due 2019 vs. 10-Year A Utility Index CL&P 5.5% due 2019 vs. Peers

Date CL&P '19 UTY Index Difference8/10/2009 117 117 02/10/2010 110 112 (2)8/10/2010 104 107 (3)2/10/2011 59 89 (30)Current 50 96 (46)

-1

-0.8

-0.6

-0.4

-0.2

0

0.2

Jul-09 Nov-09 Mar-10 Jun-10 Oct-10 Feb-11

% Change

NU 5.5% '19 (A2/BBB+) EXC 5.8% '18 (Baa1/A-)D 5.0% 19 (A3/A-) CMS 6.7% '19 (A3/BBB+)PSD 6.274% '37 (A3/A-)

___________________________Source: Bloomberg, Barclays Capital.

___________________________Source: TRACE, Barclays Capital.

-72%-67%-58%

-52%-56%

NU Subsidiaries Outperforming Market



39

0

100

200

300

400

500

Jan-08 Apr-08 Aug-08 Oct-08 Dec-08 Feb-09 Jun-09 Sep-09 Dec-09 Mar-10 Jun-10 Sep-10 Dec-10 Mar-11

Spread (bps)

CL&P 10-Year Indicative New Issue Spread 10-Year A-Utility Credit Index

0

200

400

600

800

Jan-08 Apr-08 Aug-08 Oct-08 Dec-08 Feb-09 Jun-09 Sep-09 12/31/209 Mar-10 Jun-10 Sep-10 Dec-10 Mar-11

Spread (bps)

NU 10-Year Indicative New Issue Spread 10-Year BBB-Utility Credit Index___________________________Source: Bloomberg, Barclays Capital.

Connecticut Light & Power Indicative New Issue Levels vs. Single A Utility Credit Index

Northeast Utilities Indicative New Issue Levels vs. BBB Utility Credit Index

CL&P indicative new issue spreads are lower than the

comparable index

Connecticut Light & Power and Northeast Utilities have both seen indicative new issue levels improve consistently over the past two years, outperforming comparable indices

Improving New Issue Indications

NU indicative new issue spreads are lower than the

comparable index

40

HoldCo Credit Rating Comparison:Peers With Higher Credit Ratings

Northeast UtilitiesConsolidated Edison Inc.

Wisconsin Energy Corp.

Xcel Energy Inc. Peer Average

Credit Ratings SummarySecurity: Sr. Unsecured Sr. Unsecured Sr. Unsecured Sr. UnsecuredS&P Credit Rating BBB- A- BBB+ BBB+S&P Credit Outlook Positive Stable Stable StableMoody's Credit Rating Baa2 Baa1 A3 Baa1Moody's Credit Outlook Stable Stable Stable Stable

Balance Sheet SummaryLong-Term Debt $4,633 $10,671 $3,932 $9,263Short-Term Debt & Current Portion of LTD 66 5 1,131 522Off Balance Sheet and Other Debt 0 219 58 141Accrued Interest 0 0 0 164

Total Debt $4,699 $10,895 $5,121 $10,090Minority Interest 1 0 0 0Preferred Stock 116 213 30 105Shareholders' Equity 3,811 11,274 3,802 8,084

Total Book Capitalization $8,628 $22,382 $8,954 $18,278

Credit RatiosTotal Debt / Capitalization 56.7% 48.7% 57.2% 55.2% 53.7%

EBITDA Interest Coverage 5.6x 4.9x 5.0x 4.4x 4.7xTotal Debt / EBITDA 3.9x 3.7x 5.0x 4.0x 4.2xFFO Interest Coverage 5.1x 4.3x 5.3x 4.6x 4.8xFFO / Total Debt 18.5% 18.6% 17.3% 20.8% 18.9%

Summary Operational and Financial StatisticsLTM Gross Interest Expense $217 $609 $206 $577FFO $955 $2,029 $888 $2,096LTM Revenues $4,736 $13,325 $4,203 $10,311LTM EBITDA $1,209 $2,956 $1,025 $2,528LTM Net Income from Continuing Operations $363 $992 $323 $727

41

2011 Forecast

42

Highlights

• Continued strengthening of earnings and key financial ratios

• Distribution rate case outcomes reflected

• Bonus depreciation adds $250 million to cash flows in 2011 alone; estimated $450 - $550 million in 2011 - 2013

• Increased transmission spending as Greater Springfield construction accelerates

43

2010 Actual and 2011 Projected Ratios Much Improved

2010 Budget 2011 Projected 2010 Actual 2011 Budget

FFO/Debt 14.7% 11.7% 18.5% 18.6%

FFO/Interest Expense 3.8 3.1 5.1 4.8

Debt/Capital 57.8% 60.2% 57.0% 57.3%

Cap Ex (in millions) $1,096 $1,374 $1,043 $1,217

Outlook in April 2010 Outlook in April 2011

44

2011 Long-Term Debt Issuance Plans

CL&P: $200 million

PSNH: $210 million

WMECO: $170 million

Yankee Gas: $ 50 million

Total: $630 million

CL&P: $0

PSNH: $160 million

WMECO: $100 million

Yankee Gas: $0

Total: $260 million

April 2010 Forecast April 2011 Forecast

45

Appendix

46

Strategic Risk Momentum Summary – March 2011

1 Adapting to a climate of changing energy policies and regulations

A Changes in regulatory or legislative policy limit NU’s ability to affect local and regional energy policy

CT Gov. Malloy introduced legislation to reorganize the DPUC and DEP into a single new organization - the Department of Energy and Environmental Protection (DEEP) -that will develop energy policy for CT.

Current Status: Forward Momentum:

B New entrants to the transmission owner segment require NU to compete to build transmission

Some NE regulators are suggesting competition for transmission projects, but there have been no active efforts to change existing rules. Regulators also continue to comment on the need for better cost monitoring going forward. FERC sees NE process as a model that is working. FERC’s future order regarding their Transmission Planning and Cost Allocation NOPR could require NE to change current rules and procedures, but not in the short term.


C Federal or State environmental regulations are issued or enforced in ways that are detrimental to our generation business

The EPA has issued proposed legislation that would require coal and oil based power plants to reduce emissions of mercury and acid gases by 91% and cut SO2 by 53%. However, the EPA also issued a proposal for section 316(b) of the Clean Water Act, which clarifies the fish impingement requirements and is less burdensome to PSNH than anticipated. Recent election results could change the dynamic in 2011. PSNH continues to seek opportunities to assist in renewable generation development. NH Air Resources Council upheld its decision in granting PSNH a temporary air permit for the construction of the Merrimack scrubber; other appeals pending.


2 Recovering revenue sufficient to operate safely, reliably and with adequate shareholder returns

A Persistent lackluster sales growth or sales erosion results from the impact of a continued weak economy, higher customer bills, conservation and distributed generation

Although sales were higher than budget and prior years in 2010, weather-normalized sales continue to decline. The MA-DPU approved WMECO’s decoupling plan.

Interest in distributed generation remains strong, but the trend has not changed significantly. The operating companies continue to manage to their O&M spending.


Stable

FavorableUnfavorable

FavorableUnfavorableSlightly Negative

Slightly Negative



Stable

47

Strategic Risk Momentum Summary – March 20113 Managing costs and net income under rate and regulatory pressures

A Regulatory decisions and processes in the distribution business result in under earning due to lags or disallowances, or unsupported programs/investments.

Completion of all three electric rate cases provides foundation for companies to operating within known financial boundaries.


B Transmission rate recovery mechanisms are dramatically changed; ISO model proves ineffective in NE and states increase search for alternatives.

FERC initiated transmission cost allocation rulemaking that may be helpful to NE Transmission Owners and NU’s Strategic Transmission Business Plans. NU is actively participating in the transmission cost allocation discussions with EEI, regulators, the PTO-AC and CFTP regarding responses to FERC’s NOPR on Transmission Cost Allocation.


4 Maintaining schedule and cost targets for large Transmission projects

A Substantial delays in, displacement or cancellation of transmission projects due to:

Design, Siting, Permitting, ISO-NE procurement, Environmental: Favorable progress in siting for Greater Springfield Reliability Project , Maine Power Reliability Program, and by ISO-NE for Interstate Reliability Project. Continue to build relationships with Native American tribes.


Alternatives of NE Stakeholders: No active efforts to change existing rules, but regulators continue to comment on the need for better cost monitoring going forward. FERC sees the NE process as a model that is working. FERC’s future order regarding their Transmission Planning and Cost Allocation NOPR could require NE to modify the current planning process, but not in the short term.


Generation, Demand Resource or Energy Efficiency Alternatives: Risk remains for CEAB Request for Proposal process to delay transmission projects in Connecticut. However, due to CT budget constraints and pending energy bill legislation, the DPUC/CEAB’s ability to issue an RFP for the Interstate Reliability Project, as well as the viability of any future CEAB action, may be impacted.


Stable

Stable





Stable

FavorableUnfavorableSlightly Positive

Slightly Positive

48


5 Executing our business with high standards

A Failure to identify weaknesses and establish clear expectations in basic operations, customer service and the implementation of major projects.

Overall system reliability is solid. The momentum reflects the continued call center performance, ongoing alignment of Customer Experience and Operating Company operating plans and metrics, and the relationship building CL&P is doing with its C&I customers.


6 Successfully implementing our growth strategies

A Delays and/or cancellations of major transmission initiatives

Northern Pass: Transmission Services Agreement for Northern Pass Transmission project was approved by FERC on 2/11/11 without modification. U.S. Department of Energy public scoping meetings (7) are complete. Evaluation of various routes is underway. Siting process, with organized opposition, is underway.

No new developments on Renewables Consortium project.


B Lower earnings on Transmission projects

New England Commissioners may seek to petition the FERC on Transmission ROEs, claiming that they are excessive.


7 Operating in a difficult business and/or economic climate

A The business climate in Connecticut inhibits economic growth

The economy in CT remains weak and is likely to continue to impact its budget deficit. The potential for slow/negative business growth and employment reductions drives negative expectations, coupled with new proposed legislation that could further negatively impact the business climate.

Current Status: Forward Momentum

B Increases in pension expense require significant capital contributions

Key pension assumptions were updated and the impact of a lower discount rate, return on assets and salary increase assumption were incorporated into pension expense and funding projections. Assets are performing well in the plan and interest rates remain low but stable. The expectation is that rates will move higher at some point, which would benefit the funded status as higher discount rates reduce the present value of the liability.



StableFavorableUnfavorable

Slightly NegativeFavorableUnfavorable

Slightly Positive

Slightly Positive

Slightly NegativeFavorableUnfavorable


49

Strategic Risk Momentum Summary – March 20118 Avoiding/Minimizing NU as a target of political agendas

A External stakeholders use high customer bills & the economy, or the company’s policies & performance, as a platform to adversely impact NU’s business model.

Initiatives to increase staffing, self service options, and improve existing technology and processes continue. New web tools and partnerships are increasing communication and cooperation between NU and the social agencies, and Customer Experience continues to assist customers with finding available resources. Call center resources have been allocated to meet the needs of each company.


B States harmed by the recent recession look to improve budget deficits through new taxes, fees and assessments and/or the abstraction of revenues from customer support programs.

Current status reflects the ongoing work associated with the 2011 legislative session. Connecticut’s legislative session may be linked to the continued CT budget deficit.


9 Managing the challenge of increasing customer expectations

A Customers demand better communications and reliability with quicker response times to outages

NU companies continue to improve practices and processes related to restorations by implementing recommendations from the best practice study and benchmarking, and are proactively evaluating operating company plans and practices. CL&P has significantly increased its town liaison initiative, with positive response. Operating companies are increasing goodwill with ongoing presentations and communications.


10 Operating effectively and securely with increasingly complex technology

A New technologies and operating environments (external data hosts) raise the risk of breaches of information security and disruptions to operations

A Confidential Information Management Program is being developed that will be managed by a cross-functional committee reporting to the Enterprise Technology Council.

While written certifications regarding confidential information are in place with vendors, there are no formal industry standards for controls. However, IT has ongoing discussions with its vendors as NU increasingly uses external data warehouses, which raises exposure to this risk. Purchasing has general terms and conditions that establish expectations on the electronic exchange of information between NU and its vendors.


B IT implementation of development projects is fragmented due to a lack of an overall business-integrated, enterprise-wide strategy that incorporates the use of IT technology

Program management has been updated to focus more on initial project estimates, scope and business change. Current projects incorporate enterprise-wide, business integrated strategy and improved change management methodology.



Stable

Stable




Slightly Positive

Slightly Positive

Stable



Documents

Rating Agency Meetings