Name

Title

Summary of Information

(where applicable)

Mr. Sheffield was appointed Interim President and CEO on June 21, 2022 and held the position until February 1, 2023.

Mr. Lebeter is the President and CEO, a position he assumed February 1, 2023. As he fills vacancies on the ELT, Mr. Lebeter also continues in his role as the Chief Operating Officer, a role he assumed in January 2020.

Mr. Poweska held the President and CEO role until June 21, 2022 and left the Company on September 21, 2022.

Principle

Objective

Principle

Objective

maximum total direct compensation (base salary, short-term incentive and long-term incentive) of $1,500,000 for the President and CEO in 2019 ($1,531,500 in 2020 reflecting an increase of 2.1%, $1,542,221 in 2021 reflecting an increase of 0.7% and $1,604,488 in 2022 reflecting an increase of 4.0% as aligned with the legislative requirements described below);

maximum total direct compensation for other executives no greater than 75% of the President and CEO’s total direct compensation;

the maximum total direct compensation could be adjusted annually by the lesser of the rate of Ontario Consumer Price Index (“CPI”) and the annual rate at which total maximum direct compensation was adjusted for non-executive managerial employees;

pension and benefits entitlements were not to be in excess of those provided to non-executive managerial employees; and

other bonuses (including signing bonuses), perquisites, or share options were not permitted.

Human Resources Committee:

Committee Members:

Melissa Sonberg (chair)

Blair Cowper-Smith

Mark Podlasly

Russel Robertson

The committee met in camera without management present at each of its regularly scheduled meetings.

Committee Membership: The HRC must consist of at least three directors, all of whom must be independent.

Duties and Responsibilities include overseeing:

•   the effectiveness of the Company’s human capital and human resources strategy, policies, programs and procedures, including diversity and inclusion policies and practices;

•   the compensation and incentive policies, programs and plans of the Company designed to attract, retain and develop executives and employees with the skills and expertise needed for the Company to carry out its strategies, business and operations;

•   the compensation of the President and CEO and other direct reports and other key employees of Hydro One Limited and its subsidiaries as the HRC or Board may determine (collectively, the “Designated Employees”);

•   retaining external consultants and advisors to receive independent and objective advice on the compensation and human resources policies and programs of the Company;

•   reviewing matters relating to succession planning of the Company’s President and CEO and the Designated Employees;

•   the Company’s policies and programs to promote a culture of integrity and responsible stewardship, including through its oversight of the Code of Business Conduct and the Whistleblower Policy, and related practices and procedures; and

•   the Company’s labour relations strategy.

2022 Accomplishments and Highlights include:

•   Reviewed:

•  enterprise risk management updates, including the HR Risk universe;

•  regular people strategy updates, including initiative spotlights;

•  future of work updates;

Human Resources Committee:

•  quarterly code of business conduct and ethics and whistleblower policy updates;

•  updates on our labour strategy;

•  incentive compensation information and benchmarking;

•  executive shareholdings against our share ownership guidelines;

•  performance reports for both the defined benefit pension plan (“DBPP”) and the defined contribution pension plan (“DCPP”);

•  an evaluation of the committee’s compensation consultant;

•  updates to the Company’s Diversity, Equity and Inclusion (“DEI”) strategy;

•  updates on talent management and succession planning;

•  executive share ownership holdings against requirements;

•  updates on the Company’s people strategy update including effectiveness metrics;

•  a new employee benefit program;

•  employee survey results;

•  2023 individual performance scorecards for Designated Employees and the President and CEO; and

•  a compensation risk assessment.

•   Reviewed and approved:

•  merit increases for management employees;

•  2021 short-term incentive plan (“STIP”) aggregate individual performance multipliers for management and non-represented employees;

•  2021 STIP performance multiplier for the ELT;

•  2021 DBPP, DCPP and year-end financial statements and DBPP statement of investment policies and procedures;

•  the Company’s DEI commitment statement;

•  bargaining mandates;

•  a new peer group; and

•  DBPP and DCPP amendments.

•   Reviewed and recommended:

•  President and CEO’s position description;

•  amended committee mandate;

•  2021 STIP corporate scorecard results and performance multiplier;

•  2022 STIP corporate scorecard;

Human Resources Committee:

•  2022 long-term incentive plan (“LTIP”) performance measures;

•  2021 STIP for the President and CEO;

•  2022 merit increase for the President and CEO;

•  2022 LTIP grant for management, Designated Employees and President and CEO;

•  2019 LTIP performance multiplier;

•  2022 management information circular compensation discussion and analysis;

•  a new restricted share unit plan for society represented employees; and

•  the President and CEO succession plan.

human resources experience (experience with benefit, pension and compensation programs, particularly executive compensation);

risk management experience (knowledge and experience with internal risk controls, risk assessments and reporting as it pertains to executive compensation); and

executive leadership experience (experience as a senior executive/officer of a public company or major organization).

Compensation Advisor

Mercer (Canada) Limited⁽¹⁾

In 2021 and 2022, Mercer provided specific market compensation benchmarking analysis in the form of a custom compensation survey directed by the Ontario Energy Board (“OEB”) for purposes of the Company’s joint (distribution and transmission) rate application filing before the OEB. This analysis is not related to executive compensation. While the HRC is not required to approve work related to the OEB benchmarking study prior to completion, the work is completed by a separate Mercer consultant distinct from the one providing advice to the HRC. No fees other than for executive compensation or related matters were charged by the independent advisor in either 2021 or 2022 for work requested by the HRC or the Board.

Hydro One Limited and its subsidiaries’ core business as Canada’s largest electricity transmission and distribution service provider;

the unique dynamic of Hydro One Limited’s ownership structure, recognizing the complexity of a publicly traded company with significant investment by the Province; and

the particular considerations inherent with highly-regulated organizations having large societal impact.

Private Sector Peers

Public Sector Peers

Total assets and total revenues are calculated using data for the most recently reported 12-month period ending December 31, 2022.

Peer information included in this chart was prepared by Mercer using data from S&P Capital IQ.

The market capitalization of Hydro One Limited was approximately $21.7 billion and its total enterprise value was approximately $36.4 billion as at December 31, 2022.

Market capitalization is calculated based on the number of common shares of Hydro One Limited outstanding multiplied by the closing share price of the common shares of Hydro One Limited and total enterprise value is calculated based on market capitalization plus net debt. Public sector organizations are excluded from these statistics as market capitalization and total enterprise value cannot be calculated.

a compensation structure that reflects market practices,

compensation targets set in reference to the market, over time,

a new equity-based long-term incentive plan, and

incentive payouts aligned with pay-for-performance principles.

Practice

Description

Directors, executives and other employees are prohibited from purchasing financial instruments that are designed to hedge, offset or otherwise reduce or limit their economic risk, including with respect to a decrease in market value of equity securities of Hydro One Limited granted, as compensation or held, directly or indirectly, by such individuals, or otherwise undermining their alignment with shareholder interests, except with the prior written approval of the HRC.

Prohibited transactions include hedging strategies, equity monetization transactions, transactions using short sales, put options, call options, exchange contracts, derivatives and other types of financial instruments (including, but not limited to, prepaid variable forward contracts, equity swaps, collars and exchange funds), and the pledging of or granting of any other security interest in equity securities of Hydro One Limited as security for any loan where recourse is limited to the pledged security.

Practice

Description

Hydro One is committed to meeting all targets established at the outset of the incentive compensation performance periods. However, exceptional circumstances outside of management’s control may occur.

The HRC has established principles and practices for incentive compensation adjustments.

The purpose of these principles and practices is to provide clarity on the circumstances and process for considering any such exceptions.

To better align the interests of the Company’s executives with the interests of Hydro One Limited’s shareholders, Hydro One Limited has share ownership requirements based on the level of the position. Under these requirements, the Company’s executives are subject to share ownership requirements which can be met through direct or beneficial ownership of Hydro One Limited’s common shares, management deferred share units (“management DSUs”), and 25% of performance cash-settled LTIP grants.⁽¹⁾ Individuals have until the later of seven years from: (a) the closing date of the initial public offering of Hydro One Limited’s shares in November 2015; and (b) the date they first became subject to the share ownership requirements. Executives who are promoted to a level with a higher share ownership requirement have until the seventh anniversary of the date of their promotion to meet their new share ownership requirement. The executives must generally maintain the ownership level as of the date of retirement for 24 months (in the case of the President and CEO) or 12 months (in the case of other executives).

For purposes of assessing the requirement, 25% of the target value of outstanding cash-settled LTIP is counted during the vesting period. This practice reflects the Company’s inability to grant equity-based awards (which would count toward the requirement), under the executive compensation framework. The expectation is upon the vesting of cash-settled LTIP awards, executives will use a portion of the proceeds to purchase common shares of Hydro One Limited. Once cash-settled awards have vested they are not counted toward the achievement of ongoing share ownership requirements.

The share ownership requirements as a multiple of annual base salary are set forth below:

President and CEO

EVP or equivalent Direct Report to the President and CEO

All Other Executives – SVP or equivalent, and Vice President Level or equivalent

Practice

Description

Cash-settled LTIP grants with 100% performance-based payouts were designed to continue the alignment of company performance with shareholder interests, while ensuring that compensation for Hydro One’s executives also remained within the guidelines established by the executive compensation framework as described starting on page S-3.

Management

HRC

Compensation
Advisors

Board

Recommends President and CEO’s target compensation to Board for approval

Reviews and approves target compensation for direct reports to the President and CEO

Assesses the President and CEO’s performance and recommends same to the Board

Reviews performance of the President and CEO’s direct reports

Management

HRC

Compensation
Advisors

Board

Reviews, finalizes, and approves compensation for the President and CEO’s direct reports

Recommends the President and CEO’s compensation to the Board for approval

William Sheffield, 74

Interim President and Chief Executive Officer

William Sheffield is the former CEO of Sappi Fine Papers, headquartered in the U.K. and South Africa. He began his career in the steel industry with Stelco Inc., headquartered in Ontario. Mr. Sheffield also held senior roles in the forest products industry with Abitibi-Price Inc. and Abitibi-Consolidated Inc. where he led the forestry, mill and hydro-electric operations with the Iroquois Falls Division in northern Ontario. Mr. Sheffield held the role of Interim President and CEO of Hydro One Limited and Hydro One Inc. from June 21, 2022 to February 1, 2023.

Mr. Sheffield has been a corporate director since 2004. He currently sits on the board of Atlantic Packaging Products Ltd. Previous directorships include Ontario Power Generation, Canada Post Corporation, Velan Inc., Houston Wire & Cable Company, Pan Asia Paper, Corby Distilleries, Royal Group Technologies, 4iiii Innovations Inc., Family Enterprise Canada, and SHAD. In addition to his engagements on the boards of public companies and Crown corporations, Mr. Sheffield has had experience with family enterprise advisory boards such as Burnbrae Farms, Longview Aviation Capital Corp. and Epicure.

Mr. Sheffield holds a Bachelor of Science (Chemistry) from Carleton University, an MBA from McMaster University and holds his ICD.D. In 2015, he was awarded a Fellowship from the National Association of Corporate Directors in the United States. He also completed the Family Enterprise Advisors Program (FEA) at the University of British Columbia.

Chris Lopez, 48

Chief Financial Officer

Chris Lopez is the CFO of Hydro One Limited and Hydro One Inc., a position he assumed after being appointed as Acting CFO in late 2018. Mr. Lopez joined Hydro One in 2016 as the Senior Vice President of Finance and has more than 23 years of progressive experience in the utilities industry in Canada, the United States and Australia.

As CFO, Mr. Lopez is responsible for the corporate finance function, including treasury and tax, as well as internal audit, investor relations, risk, pensions and shared services, including supply chain, strategy and growth, Acronym Solutions Inc., and mergers and acquisitions.

Prior to joining the organization, Mr. Lopez was the Vice President, Corporate Planning and Mergers & Acquisitions at TransAlta Corporation (“TransAlta”) from 2011 to 2015, and the Director of Operations Finance at TransAlta from 2007 to 2011 in Alberta, Canada. He also held senior financial roles for TransAlta in his native Australia, from 1999 to 2007. At the start of his career, he worked as a financial accountant following the completion of the Graduate Leadership Development Program, with Rio Tinto.

Mr. Lopez holds a Bachelor of Business degree from Edith Cowan University in Australia, and a Chartered Accountant designation. He is a Graduate member of the Australian Institute of Company Directors and has completed the CFO Leadership Program at Harvard Business School.

Paul Harricks, 68

Chief Legal Officer

Paul Harricks is the Chief Legal Officer of Hydro One Limited and Hydro One Inc., leading all aspects of the organization’s regulatory, legal, compliance, corporate governance and business ethics activities.

Prior to joining Hydro One in September 2019, Mr. Harricks practiced law for about 40 years, working extensively in the energy and infrastructure industries and serving as a partner and leader of the Energy Sector Industry Group of Gowling WLG Canada LLP, a major Canadian law firm.

A seasoned and trusted legal and strategic advisor, Mr. Harricks has delivered effective results in the fields of electricity distribution, transmission and generation and has led a range of public and private mergers and acquisitions.

Mr. Harricks is a past Director of the Association of Power Producers of Ontario and is a current member and a past Chair of the Energy Transition Committee of the Toronto Region Board of Trade. He is also a Director and Audit Committee and Compensation Committee member of Pioneering Technology Corp. and an active member of the International Bar Association.

He holds a Bachelor’s degree from the University of Toronto and an LLB from Osgoode Hall Law School.

David Lebeter, 63

President and Chief Executive Officer

Mr. Lebeter is a highly regarded leader with over 40 years’ experience in the utility and forestry sectors and a reputation for driving improved safety, employee engagement, productivity, customer centricity and successfully delivering capital investments.

Mr. Lebeter has 18 years of experience in all facets of the electricity sector and in his role as COO of Hydro One Networks Inc., Mr. Lebeter is responsible for transmission and distribution, including construction, maintenance, vegetation management as well as system operations, asset planning and engineering. Under Mr. Lebeter’s leadership, safety, productivity, reliability and customer experience have improved.

Before joining Hydro One, he held progressively senior positions in operations and safety at BC Hydro from 2005 to 2019, including Vice President Field Operations & Safety, and held leadership roles in generation, transmission, distribution and safety. During his tenure, he was responsible for improving safety, reliability, employee engagement and customer service, lowering costs and building trust with union leaders and Indigenous communities.

Mr. Lebeter spent 23 years in the forest industry prior to joining the utility sector, working in leadership positions responsible for operations.

He has previously served as an Executive Board Member for Smart Grid Northwest, as an Operations Board Member for Western Energy Institute, and as the Chairman of the Distribution Council with the Canadian Electricity Association. He holds his ICD.D.

Mr. Lebeter holds a Bachelor’s degree in Forestry from the University of British Columbia, and is a registered professional forester. In addition, Mr. Lebeter holds an Executive Master of Business Administration from Simon Fraser University.

Megan Telford, 48

Chief Human Resources Officer

Megan Telford is the Chief Human Resources Officer at Hydro One Networks Inc., a role she assumed in September 2020. Ms. Telford is responsible for all areas of human resources across Hydro One, including labour relations, talent management, total rewards and change and culture.

Ms. Telford is an experienced leader with deep expertise in law and human resources. Before joining Hydro One, Ms. Telford held the position of Head of Human Resources at Toronto Dominion (“TD”) Insurance from 2019 to 2020, and also held a number of increasingly senior roles across the TD Bank in both legal and human resources since 2007. Prior to TD, Ms. Telford practiced labour and employment law at a national law firm and worked at the Permanent Court of Arbitration in The Hague.

Ms. Telford holds an Honours Bachelor of Arts degree in Industrial Relations from McMaster University, a Master of Industrial Relations and Juris Doctor from Queen’s University and she was a law clerk for Justices Stone and Strayer at the Federal Court of Appeal.

Component

Form

Objectives

•   Attract and retain highly qualified and experienced executives

•   Provide a predictable and steady income

•   Provide market-competitive, sustainable retirement arrangements to attract and retain talent

•   Indirect compensation to assist employees in covering select life events and promoting health and wellness

Cash – executives can choose to receive some or all in the form of deferred share units (“management DSUs”)

•   Motivate and reward achievement of annual business performance objectives

•   Align individual performance and rewards with corporate objectives

•   Motivate and align executives with long-term strategy and shareholders’ interests

•   Encourage sustained long-term performance

•   Balance short- and long-term results focus

•   Encourage share ownership and increase alignment with shareholders’ interests

Base Salary

Named Executive Officer

William Sheffield⁽²⁾

Chris Lopez

Paul Harricks

David Lebeter

Megan Telford

Mark Poweska

These columns reflect the NEOs’ base salary as of December 31 of the relevant year (other than for Mr. Poweska, which reflects his base salary in effect at his termination), and do not take into account any proration for base salary changes during fiscal years 2021 and 2022, respectively. Mr. Sheffield assumed his position of Interim President and CEO in June 2022 and Mr. Poweska left the organization in September 2022.

Pursuant to the terms of his agreement as Interim President and CEO, Mr. Sheffield was entitled to a monthly retainer of $66,000.

2022 Short-Term Incentive Plan (“STIP”)

provide market competitive “pay-at-risk” necessary to attract, motivate and retain employees and executives;

reinforce strategic business objectives and a performance-oriented culture with significant elements of compensation-at-risk;

focus participants on the drivers of value creation; and

reward participants for achievement of annual corporate and individual performance goals.

Elements of the

Short-Term Incentive

Plan

Impact on Award

The amount of the award is a function of the executive’s incentive target, corporate performance and individual performance.

For NEOs, awards are weighted 80% on achievement of corporate goals and 20% on achievement of individual goals.

Elements of the

Short-Term Incentive

Plan

Impact on Award

Corporate performance is based on financial and non-financial measures which seek to align corporate performance with the Company’s strategy as detailed in the corporate scorecard.

ESG and Other Non-Financial Measures

•  Health and Safety – to reinforce the importance of keeping our employees safe

•  Customer – Overall Favourable Impression – to align employees with customer perceptions of Hydro One

•  Work Program – to align employees with regulatory and customer goals

Financial Measures

•  Net Income of Hydro One Limited – to increase Hydro One Limited’s shareholder value by increasing earnings

•  Productivity Savings – to increase Hydro One Limited shareholder value by decreasing operating, maintenance and administration and capital-related costs

See pages S-21 to S-22 for more information about the performance measures and results related to the Company’s corporate scorecard.

Corporate Performance Scorecard

If the Company has a fatality, the attained High-Energy Serious Injuries & Fatality (“HSIF”) measure will be reduced to 0% based on the findings of the System Investigation.

Hydro One Limited prepares and presents its financial statements in accordance with United States generally accepted accounting principles (“U.S. GAAP”). “Adjusted net income” is not a recognized measure under U.S. GAAP and does not have a standardized meaning prescribed by U.S. GAAP and is therefore unlikely to be comparable to similar measures prepared by other companies. Adjusted net income is used by management of Hydro One Limited to assess the company’s performance and is considered a useful metric to evaluate the company’s current operations compared to the prior year because it excludes the impact of certain non-recurring costs or income. For a full description of this measure and, where applicable, a reconciliation to the most directly comparable U.S. GAAP measure in respect of Hydro One Limited, please see the section “Non-GAAP Financial Measures.”

Health and Safety: Hydro One once again achieved a best-in-class recordable injury rate of 0.616 per 200,000 hours, which is well below (better than) the world-class benchmark of 1.0 as well as the Company’s target for 2022. Hydro One also saw significant year-over-year improvement in the number of high-energy serious injuries, with only one employee sustaining a high-energy serious injury compared to four in 2021. This equates to an HSIF rate of 0.012 per 200,000 hours, which well exceeded (lower than) than the Company’s annual target. Together, these results reflect the best safety record in Hydro One’s history and the significant progress made in preventing life-altering injuries and fatalities.

Work Program: While Transmission (“Tx”) and Distribution (“Dx”) reliability results fell short of target, in part because of the severe storms experienced during the year, Hydro One continued to execute on its investment plan as Tx in-service additions were within 1% of target due to strong planning and execution across key projects. Furthermore, Hydro One’s ongoing commitment to storm response and restoration efforts for all customers and communities, in addition to a higher volume of customer connections during the year, resulted in Dx in-service additions significantly exceeding target during the period.

Adjusted Net Income: 2022 adjusted net income attributable to common shareholders of Hydro One Limited was approximately 7% better than target, due in part to higher peak demand and electricity consumption.

Productivity Savings: In 2022, Hydro One beat its productivity targets and achieved an approximate 9% increase in year-over-year productivity savings with $373.6 million saved in 2022 as compared to $343.9 million in 2021. Hydro One continues to deliver on its multi-year commitment to keep costs as low as possible, achieving approximately $1.5 billion in productivity savings since 2015.

Overall Favourable Impressions: Year-end overall favourable impression of 85% represents a record high since we started tracking the score in 2010 and reflects a 1-point improvement over 2021 results. These results reflect our proactive and comprehensive storm and outage communications strategy and ongoing offer of meaningful support for customers and communities alike.

NEO

Key Accomplishments

Chris Lopez

Chief Financial Officer

Under Mr. Lopez’s leadership, Hydro One continued to execute its 5-year Corporate Strategy and Development Roadmap, with execution of the Company’s strategic priorities remaining on track.

Mr. Lopez continues to oversee the successful execution of Hydro One’s multi-year growth plan, which remains in line with stakeholder expectations for both the regulated and unregulated businesses. In 2022, under Mr. Lopez’s leadership, Hydro One filed updated evidence in support of the Company’s joint rate application (“JRAP”) for the unforeseen impacts of increasing inflationary pressures and was ultimately successful in receiving OEB approval of a settlement agreement. Furthermore, the Minister of Energy directed the OEB to amend Hydro One Networks Inc.’s transmission license to develop four new transmission lines in southwest Ontario.

In Hydro One’s unregulated business, Mr. Lopez and his team guided the launch of Ivy’s Home Charging Service offering, the advancement of various Battery Energy Storage Systems (BESS) opportunities, and a commercial trucking charging infrastructure agreement with Home Hardware.

In 2022, Mr. Lopez oversaw Hydro One’s continued realization of productivity savings of $373.6 million, or approximately 9% higher than 2021, building on successes from earlier years.

NEO

Key Accomplishments

Paul Harricks

Chief Legal Officer

Under Mr. Harricks’ leadership, Hydro One successfully concluded several important agreements and regulatory filings in 2022, while advancing key enterprise projects.

In 2022, Mr. Harricks jointly led the successful filing and defence of the Company’s JRAP, ultimately achieving the first-ever joint settlement on the largest application ever adjudicated by the OEB.

Under Mr. Harricks’ direction, Hydro One further strengthened its relationship with the OEB by participating in its Reliability and Power Quality Review Working Group, and its Adjudicative Modernization Committee. The Company also provided input into several other OEB initiatives including its Framework for Energy Innovation, Electric Vehicle Initiative, and Activity and Program-Based Benchmarking.

Mr. Harricks also oversaw Hydro One’s participation in the Independent Electricity System Operator’s (“IESO”) Transmission and Distribution Coordination Working Group, and contributed to the Electricity Distributors Association’s submission on the IESO’s Market Visions and Design Project.

David Lebeter

Chief Operating Officer

Under Mr. Lebeter’s leadership, Hydro One successfully executed its corporate strategy, while maintaining the safe and reliable supply of electricity to Hydro One customers.

In 2022, Mr. Lebeter, together with Hydro One’s Chief Safety Officer, oversaw the Company’s safest year of operations ever. Hydro One achieved a best-in-class recordable injury rate of 0.616 per 200,000 hours, and also achieved significant year-over-year improvement in the number of high-energy serious injuries, with only one employee sustaining a high-energy serious injury compared to four in 2021.

Led by Mr. Lebeter, the team oversaw Hydro One’s response to several severe storms throughout the year, restoring power to hundreds of thousands of customers in Ontario and supporting neighbouring utilities on Canada’s east coast with the restoration of power to residents of Prince Edward Island and Nova Scotia. These strong efforts contributed to the receipt of two emergency response awards from the Edison Electric Institute during the year.

NEO

Key Accomplishments

Mr. Lebeter also oversaw the implementation of six new customer service initiatives in the Distribution line of business which contributed to the Company’s achievement of record overall favourable impression score of 85% in 2022. Furthermore, Hydro One continued to build strong partnerships with Indigenous Peoples across the Province including an increase in total procurement with Indigenous businesses to $95.9 million, the highest spend to date, as well as the announcement of the Company’s equity partnership model for new transmission line projects greater than $100 million.

As the executive sponsor for Mosaic – an employee resource group dedicated to advancing DEI – Mr. Lebeter oversaw the highest diversity in field-apprenticeship hiring in Hydro One’s history.

Megan Telford

Chief Human Resources Officer

Under Ms. Telford’s leadership, Hydro One successfully launched its new people strategy and advanced key talent, DEI and supporting operational initiatives.

In 2022, Ms. Telford oversaw the development and introduction of the four supporting pillars of Hydro One’s people strategy: We are heard, valued, and belong; We are safe, well and ready to perform; We are supported and equipped to win; and, We are ready for our future. Key people strategy initiatives included the completion of a DEI Barrier review, with recommendations incorporated into the Company’s DEI roadmap; development of a Labour Relations Leadership Training and curriculum; launch of a new employee resource group Mentoring Program for Women in Trades, Technology and Engineering; the advancement of Hydro One’s Future of Work hybrid work pilot, returning 2,000 office-based colleagues back into the workplace in person, at scale, for the first time since early 2020; and enhancement of the Company’s People Leader capabilities through its executive, senior leadership and middle management development programs.

Under Ms. Telford’s direction, the Human Resources team executed its refreshed talent management strategy, advanced the company’s succession plans, and finalized its ELT development and effectiveness program. Additionally, the team advanced its human resources functional strategy and operating model, which involved redesigning key processes and aligning its organizational structure to deliver a higher quality, more streamlined and seamless customer experience.

Ms. Telford and the Chief Operating Officer continued to advance Hydro One’s safety culture, implementing all 12 initiatives of the employee-led Safety Improvement Team, exceeding both Recordable Injury Rate and HSIF rate targets for the year. In particular, the Human Resources team directly supported work to safeguard, develop and protect apprentices, and the advancement of Hydro One’s Trade Mentorship Program.

Ms. Telford oversaw the advancement of Hydro One’s DEI strategy and became the Executive Sponsor of the new Black Employee Resource Circle, the ninth employee resource group. Under her guidance, Hydro One reached the highest diversity in field-apprenticeship hiring in its history.

STIP Decision Summary

Named Executive Officer/ Principal Position⁽¹⁾

Chris Lopez

Chief Financial Officer

Paul Harricks

Chief Legal Officer

David Lebeter

Chief Operating Officer

Megan Telford

Chief Human Resources Officer

All NEOs are eligible for STIP with the exception of Mr. Poweska who was eligible but did not receive a payment under this plan due to his resignation prior to December 31, 2022 and Mr. Sheffield who was not eligible.

Incentive target as of December 31, 2022.

Aggregate target incentive award for 2022.

Under the requirements of the executive compensation framework, Messrs. Lopez, Harricks, Lebeter, and Ms. Telford receive STIP payout capped at 100% of target award. To adhere with this requirement, the total STIP payout has been limited to 100% of target.

Cash-Settled Long-Term Incentive Plan

provide market competitive compensation;

attract and retain highly qualified and experienced talent;

foster alignment with shareholder interests; and

reward executives for longer term value creation.

earnings per share (“EPS”), which reward executives for delivering increased earnings to shareholders and includes the requirement that the dividend does not decrease in any rolling 12 months during the performance period;

productivity savings, which reward executives for achieving improvements in productivity and efficiency, which ultimately drive value for both shareholders and customers; and

relative total shareholder return (“TSR”), which rewards executives for achieving shareholder returns that are consistent with or better than the returns provided by peer organizations.

Elements of the

Long-Term

Incentive Program

Impact on Award

Each cash-settled LTIP award granted in 2022 is 100% performance based, subject to achieving certain performance levels for the period from January 1, 2022 to December 31, 2024 (the “Performance Period”).

(1)   three-year average adjusted EPS (subject to a dividend rate modifier) – 62.5% weighting;

(2)   three-year productivity savings – 25% weighting; and

(3)   three-year relative TSR, (S&P/TSX Capped Utilities Index) – 12.5% weighting.

The EPS and relative TSR performance measures demonstrate a commitment to achieving long-term growth for Hydro One Limited’s shareholders, which is consistent with or better than the growth delivered by other Canadian utilities, while the productivity measure is aligned with the Company’s strategic focus on operating efficiencies.

Three-year average EPS: The adjusted net income attributable to Hydro One Limited’s shareholders for such fiscal period divided by the average outstanding shares during such fiscal period.

Dividend rate: If the 12-month rolling average dividend rate during the Performance Period falls below the annualized quarterly dividend rate at the time of grant, a 0% modifier will be applied to the EPS performance multiplier. If the 12-month rolling average dividend rate during the Performance Period does not decrease from the level at grant, a 100% modifier will be applied to the EPS performance multiplier.

Three-year productivity measure: Hydro One’s commitment to achieving incremental and continuous productivity improvements is central to the planning and execution of work programs across the Company. Identified savings were quantified and embedded in the business plan having regard to the mutual benefit to customers and Hydro One Limited shareholders.

Relative TSR: Measures Hydro One Limited’s total shareholder return over the Performance Period relative to the total shareholder return for the S&P/TSX Capped Utilities Index for the same period.

The LTIP productivity results over the 2020 to 2022 Performance Period are aligned with the methodology used to set targets at the time of grant. As a result, due to the differing inflation assumptions in place at the time of grant, productivity presented for LTIP will differ from that presented in other sections.

Consistent with the requirements of the executive compensation framework, cash LTIP payouts for CEO and EVPs are capped at 100% of target.

Named Executive Officer⁽¹⁾

William Sheffield

Chris Lopez

Paul Harricks

David Lebeter

Megan Telford

Mark Poweska

All NEOs are eligible for cash-settled LTIP, except for Mr. Sheffield who was not eligible to receive an LTIP award. Pursuant to the terms of his agreement as Interim President and CEO, Mr. Sheffield was entitled to a monthly award of DSUs with a grant date value of $66,000.

No share-based or option-based awards were granted to NEOs in 2022, except for Mr. Sheffield who, pursuant to the terms of his agreement as Interim President and CEO, received DSUs under the non-employee director DSU plan.

The value of the 2022 cash-settled LTIP does not appear on the summary compensation table in 2022 as the grant will not vest until 2025.

Target Compensation Mix

Base salary reflects the annualized base salary as of December 31, 2022.

The short-term and long-term incentive targets are based on base salary as of December 31, 2022.

Due to the interim nature of his assignment, a target compensation mix was not set for Mr. Sheffield.

Mr. Poweska’s values represent his target compensation mix prior to his resignation.

Pension Benefits

attract and retain employees;

result in lower and more stable cost over time compared to the DBPP; and

promote sharing of retirement savings responsibility between Hydro One and its employees.

Eligibility: Eligible non-union employees hired on or after January 1, 2016, as well as non-union employees hired before January 1, 2016 who were not eligible or had not irrevocably elected to join the DBPP as of September 30, 2015. All NEOs participate in the DCPP.

Employee Contribution: Mandatory contribution of a minimum of 4% of pensionable earnings and a maximum contribution of 6% of pensionable earnings, subject to the limit outlined under the “Supplemental Plan” heading below.

Employer Match: Employee contributions are matched by Hydro One.

Pensionable Earnings: Base salary plus actual short-term incentive (but not exceeding 50% of base salary).

Supplemental Plan: Effective as of January 1, 2018, once the total employee and employer contributions for the calendar year have reached the maximum contribution level permissible under a registered pension plan, as per the Income Tax Act (Canada), employee contributions cease and employer contributions are allocated to a notional supplemental pension plan account for the employee’s benefit. The notional supplemental pension plan was approved by the Board on December 8, 2017 and replaces a non-registered savings plan in which employer contributions were made on an after-tax basis.

Management Employee Share Ownership Plan

promote an ownership culture among non-union employees;

align the interests of non-union employees with Hydro One Limited shareholder interests; and

increase employee awareness and alignment with Hydro One’s performance.

Element

Description

Other Benefits

Equity-Settled Long-Term Incentive Plan

PSUs and RSUs.

•  Options. An option is the right to acquire a common share of Hydro One Limited on a future date on payment of the exercise price. The exercise price of an option may not be less than the fair market value of a common share of Hydro One Limited on the date of grant. The term of an option may not exceed 10 years, unless extended due to the existence of a company trading blackout period.

While none of the following have been granted, the LTIP also contemplates the possibility of grants of:

•  Restricted shares. A restricted share award is an award of common shares of Hydro One Limited subject to forfeiture restrictions.

•  DSUs. A deferred share unit (“DSU”) is an award that entitles the participant to receive common shares of Hydro One Limited following termination of employment or service with the Company. DSUs may be subject to performance conditions or other vesting conditions.

•  SARs. A share appreciation right (“SAR”) is the right to receive common shares of Hydro One Limited equal in value to the appreciation in the value of a common share of Hydro One Limited over a period. The base price against which a SAR is to be measured may not be less than the fair market value of a common share of Hydro One Limited on the date of grant. An option and a SAR may be granted in tandem, in which event the SAR will vest and be exercisable on the same dates as the related option and the exercise of the option results in the surrender of the SAR, and vice versa. The term of a SAR may not exceed 10 years, unless extended due to the existence of a company trading blackout period.

•  Other awards. Other awards are awards that are convertible into or otherwise based on the common shares of Hydro One Limited.

Employees and consultants of Hydro One and its affiliates as determined by the HRC.

Non-employee directors on the Board are not eligible.

Under the LTIP and any other Hydro One Limited security-based compensation arrangements:

•  maximum number of common shares of Hydro One Limited issuable to insiders at any time is 10% of the outstanding common shares of Hydro One Limited.

•  maximum number of common shares of Hydro One Limited issuable to insiders within any one-year period is 10% of the outstanding common shares of Hydro One Limited.

•  the LTIP does not provide for a maximum number of common shares of Hydro One Limited which may be issued to an individual pursuant to the LTIP and any other security-based compensation arrangement (expressed as a percentage or otherwise).

Unless otherwise determined by the HRC, all unvested awards continue to vest and are settled and exercised in accordance with their terms.

“Retirement” means:

(a)   If the employee:

i.   is the President and CEO (or reports directly to the President and CEO), the retirement has been approved by the Board and the employee complies with such conditions as the Board may require;

ii.  is not i. above, the employee has reached age 65 or reached age 55 with a minimum of 10 years of service or such lesser age and/or service thresholds as the HRC may determine;

iii.   achieved the age and service eligibility criteria for an undiscounted early retirement pension as defined by the DBPP applicable to the participant;

iv.   has achieved such lesser age and/or service thresholds as the plan administrator may determine.

(b)   the employee has given formal notice of their intention to retire six months in advance or such lesser period as the plan administrator may approve;

(c)   no cash severance payment or retirement allowance or equivalent is paid; and

(d)   the employee has complied with such transitional activities as may be reasonably required by Hydro One until the date the individual has ceased active employment.

If the employee has five (5) years of service or more and has not committed and has not failed to take any action, in each case that in the determination of the plan administrator has resulted or could damage the Company or its reputation, then, a prorated portion of the next instalment of any awards due to vest shall immediately vest with PSUs deemed to have met 100% of the specified performance targets. Options shall remain exercisable for 90 days from the termination date.

Unless otherwise determined by the HRC and except if termination occurs within 24 months following a change in control, all unvested awards are forfeited. Vested awards subject to exercise will remain exercisable for 90 days, or the award’s normal expiration date if earlier.

If, within 24 months following a change in control, the executive’s employment is terminated by the Company without cause then, without any action by the plan administrator:

i.   if the change in control is one of the circumstances set out in paragraphs (a) to (c) or (g) of the definition of change in control (as defined below) the prior awards held by the executive on the change in control (the “Affected Awards”) shall continue to vest and be settled or exercised in accordance with their terms; and

ii.  if the change in control is one of the circumstances set out in paragraphs (d) to (f) of the definition of change in control noted below, 1) the Affected Awards shall vest and become exercisable, realizable or payable as of the termination date, 2) any performance goals assigned to any such Affected Awards shall be deemed to have been met at 100% of the specified target level of performance for such performance goals and 3) any Affected Award that is an Option or SAR shall continue to be exercisable until, and will expire on, the earlier of its expiry date and 90 days following the termination date.

Subject to certain exceptions, means:

(a)   more than 50% of the outstanding voting securities of Hydro One Limited are acquired;

(b)   all or substantially all of the assets of Hydro One Limited are sold, assigned or transferred, other than to a wholly-owned subsidiary;

(c)   an acquisition of Hydro One Limited via merger, amalgamation, consolidation, statutory arrangement or otherwise or the dissolution or liquidation of Hydro One Limited;

(d)   individuals who, at the beginning of any two-year period constitute the Board cease to constitute a majority of the Board, excluding any individuals whose service ceased due to death during such two-year period;⁽³⁾

(e)   pursuant to its rights in the Governance Agreement, the Province replaces the entire Board (other than the President and CEO) and, in its discretion, the chair of the Board;⁽³⁾

(f)   a change is made to an Ontario law or regulation that:

i.   both (A) expressly states that it applies either (1) to Hydro One Limited or an affiliate or (2) companies in the electrical transmission and/or distribution business generally but has a disproportionate effect on Hydro One Limited and its affiliates as a whole, and (B) would materially adversely affect the ability of Hydro One to achieve any corporate performance measures set out in any outstanding awards; or

ii.  imposes limits on the quantum of compensation that may be paid to non-union employees of Hydro One or its affiliates other than restrictions established for rate approval or other purposes which do not restrict amounts actually paid;⁽³⁾ or

(g)   the board of directors of Hydro One Limited passes a resolution confirming that a change in control has occurred.

As a result of limitations on the ownership of Hydro One Limited’s shares under the Electricity Act, there would have to be an amendment to such statute for a change in control to occur in certain circumstances.

The HRC may amend the LTIP or outstanding awards or terminate the LTIP as to future grants of awards, except that a change that would affect materially and adversely an employee’s rights under the award is subject to the employee’s consent unless expressly provided in the LTIP or the terms of the award at the time of grant.

Approval of the shareholders of Hydro One Limited is required for any amendment that:

(a)   increases the number of common shares of Hydro One Limited available for issuance under the LTIP or increases the limits on awards to insiders (except with respect to the adjustments described above);

(b)   permits non-employee directors to receive awards;

(c)   reduces the exercise price of an award (including by cancelling an award and reissuing an award to the same participant with a lower exercise price) except pursuant to the provisions of the LTIP which permit the HRC to make equitable adjustments in the event of transactions affecting the Company or its capital;

(d)   extends the term of any award beyond its original expiration date (except where the expiration date would have fallen within a company blackout period or within five business days thereof);

(e)   permits an award to be exercisable or settled beyond 10 years from its grant date (except where the expiration date would have fallen within a company blackout period);

(f)   permits awards to be transferred other than to a “permitted assign” (as defined under Canadian securities law) or for normal estate settlement purposes; or

(g)   deletes or reduces the range of amendments which require Hydro One Limited shareholder approval.

Represents a change to the LTIP which was approved by the board of directors of Hydro One Limited on May 14, 2018; the TSX accepted notice of the amendment on August 10, 2018.

As noted below in the “Termination and Change in Control Provisions” table, in the event of a resignation for good reason following a Change in Control, the vesting of awards granted prior to the change in control continues or accelerates.

Represents a change to the LTIP which was approved by the board of directors of Hydro One Limited on November 10, 2017; the TSX accepted notice of the amendment on December 28, 2017.

Named Executive Officer

William Sheffield⁽⁶⁾

Interim President and Chief Executive Officer

Chris Lopez

Chief Financial Officer

Paul Harricks

Chief Legal Officer

David Lebeter⁽⁷⁾

Chief Operating Officer

Megan Telford

Chief Human Resources Officer

Mark Poweska⁽⁸⁾

Former President and Chief Executive Officer

Base Salary figures and methodology are consistent with what is reported in the Summary Compensation Table.

Annual Incentive Plans figures and methodology are consistent with what is reported in the Summary Compensation Table. In 2022, Mr. Sheffield received a discretionary bonus of $200,000 for his interim role. Mr. Poweska was eligible but did not receive a payment under this plan due to his resignation prior to December 31, 2022.

With the exception of Mr. Sheffield, Granted LTIP represents the grant date value of cash-settled LTIP awards granted in the year. This methodology differs from the Summary Compensation Table where cash-settled LTIP values are reported once the performance conditions are satisfied. Mr. Sheffield was not eligible to receive a cash-settled LTIP award. Instead, Mr. Sheffield received DSUs as part of his compensation for his interim role under the non-employee director DSU plan.

Total Direct Compensation is calculated as the sum of Base Salary, Annual Incentive Plans and Granted LTIP.

Maximum Total Direct Compensation as outlined by the executive compensation framework of $1,500,000 for the President and CEO in 2019 ($1,531,500 in 2020 reflecting an increase of 2.1%, $1,542,221 in 2021 reflecting an increase of 0.7%, and $1,604,488 in 2022 reflecting an increase of 4.0%). The maximum total direct compensation for other executives must not exceed 75% of the President and CEO’s total direct compensation.

Mr. Sheffield is a non-employee board member and was appointed Interim President and CEO from June 21, 2022 to February 1, 2023.

Mr. Lebeter was the Chief Operating Officer on December 31, 2022 and was also appointed President and CEO effective February 1, 2023.

Mr. Poweska held the President and CEO role until June 21, 2022 and left the Company on September 21, 2022.

Non-equity incentive plan

compensation ($)

Name and Principal
Position

William Sheffield⁽⁷⁾

Interim President and Chief Executive Officer

Chris Lopez

Chief Financial Officer

Paul Harricks

Chief Legal Officer

David Lebeter⁽⁸⁾

Chief Operating Officer

Megan Telford

Chief Human Resources Officer

Mark Poweska⁽⁹⁾

Former President and Chief Executive Officer

Base salaries presented are actual amounts earned for fiscal years 2020, 2021, and 2022, as applicable. 2022 base salary for Mr. Sheffield reflects time worked in his interim role in 2022 (June 21 to December 31, 2022). 2022 base salary for Mr. Poweska reflects time worked in 2022 (January 1 to September 21, 2022). 2020 base salary for Mr. Lebeter reflects time worked in 2020 (January 2 to December 31, 2020). 2020 base salary for Ms. Telford reflects time worked in 2020 (September 28 to December 31, 2020). Ms. Telford’s 2022 base salary includes a top-up for her interim role.

Other than the grant of DSUs to Mr. Sheffield, no share- or option-based awards were granted in 2020, 2021 or 2022. Mr. Sheffield received DSUs as part of his compensation for his interim role under the non-employee director DSU plan.

The short-term incentive awards attributed to the noted financial year are based on a percentage of base salary, and are paid following approval of performance multipliers by the Board in the following year. Executives can elect to receive up to 100% of the award in management DSUs. Mr. Sheffield’s incentive was a special one-time performance bonus for his interim role. Mr. Harricks elected to take 20% of his 2022 award in management DSUs. Mr. Lebeter elected to take 25% of his 2022 award in management DSUs. Mr. Poweska did not receive a 2022 award due to his resignation.

For 2020, 2021 and 2022, a cash-settled performance-based LTIP award was granted to all NEOs, as a percentage of their annual base salary, with the exception of Mr. Sheffield, who was not eligible. The actual payout for these awards at the time of vesting will be based on the achievement of predetermined corporate performance objectives which discerns the 2021 and 2022 disclosed compensation from 2020 disclosed compensation. The value of the cash-settled LTIP (see below in the Outstanding Cash-settled LTIP table starting on page S-40) does not appear in the summary compensation table in the year of grant and is instead reported in the year in which performance criteria were satisfied. The cash-settled award granted in 2020 vested on February 28, 2023 following the end of the performance period on December 31, 2022, and is included in 2022 compensation based on the performance multiplier achieved (100.00% for Messrs. Lopez, Harricks, and Lebeter and Ms. Telford). As a result, the 2021 and 2022 awards are not included in the table above, as the performance period for these grants will not end until 2023 and 2024, respectively. Mr. Poweska did not receive a 2020 cash-settled LTIP award payment due to his resignation.

The pension value for NEOs participating in the DCPP reflects the employer contributions made to the pension plan and supplemental plan during 2022. These values do not reflect the employee contributions or the investment gains/losses for fiscal year 2022.

All NEOs participate in the Management ESOP, except for Mr. Sheffield who was not eligible. Amounts represent the employer contributions to ESOP. Consistent with the executive compensation framework, none of the NEOs are entitled to perquisites or other personal benefits. Mr. Sheffield’s amount represents his board retainer earned from January 1, 2022 to June 20, 2022. Mr. Sheffield elected to receive his board retainer in DSUs, under the non-employee director DSU plan, and these amounts are reflected in the Directors’ equity ownership table on page S-46.

Mr. Sheffield was appointed Interim President and CEO from June 21, 2022 to February 1, 2023.

Mr. Lebeter was the Chief Operating Officer on December 31, 2022 and was also appointed President and CEO effective February 1, 2023.

Mr. Poweska held the President and CEO role until June 21, 2022 and left the company on September 21, 2022.

Name

William Sheffield

Chris Lopez

Paul Harricks

David Lebeter

Megan Telford

Mark Poweska

The closing price of Hydro One Limited’s shares was $36.27 on December 30, 2022.

No option-based awards were awarded in 2020, 2021 or 2022. The Board has not granted option-based awards since 2018 and no option awards remain outstanding.

No stock options were exercised by NEOs in 2022.

Reflects the value of outstanding management DSUs for Messrs. Lopez, Harricks and Lebeter, and Ms. Telford as at December 31, 2022. Mr. Sheffield’s DSUs were granted under the non-employee director DSU plan as part of his compensation for his interim role. Mr. Poweska did not have any outstanding share-based awards as of December 31, 2022.

Name

Chris Lopez

Paul Harricks

David Lebeter

Megan Telford

The value of cash-settled LTIP awards reflect values at 100% of target performance and are not tied to share price. The actual value at the end of the performance period will depend on the achievement of the pre-determined three-year performance metrics. Consistent with the requirements of the executive compensation framework, for EVPs and above, cash-settled LTIP payouts are capped at 100% of target. Mr. Poweska does not have any outstanding cash-settled LTIP awards and Mr. Sheffield was not eligible.

Name

William Sheffield

Chris Lopez

Paul Harricks

David Lebeter

Megan Telford

Mark Poweska

Hydro One Limited has not granted option-based awards or share-based awards (other than DSUs pursuant to deferral elections) to any employees including the ELT since 2018. No NEO holds outstanding options.

The value of share-based awards that vested, if any, during the fiscal year includes the value of dividend equivalents earned. This includes the value of management DSUs granted in February 2022 in respect of the 2021 short-term incentive award payment. For all NEOs, the values above are based on the share price of Hydro One Limited’s common shares of $36.27 on December 30, 2022. Mr. Sheffield received fully vested DSUs under the non-employee director DSU plan as part of his compensation for his interim role.

This column includes the full amount of the short-term incentive awards even if a NEO elected to receive all or a portion as management DSUs. Mr. Sheffield’s incentive was a special one-time performance bonus for his interim role. Mr. Poweska did not receive a 2022 award due to his resignation.

Name

Chris Lopez

Paul Harricks

David Lebeter

Megan Telford

Mark Poweska

In respect of the NEOs, the totals include pre-tax amounts contributed to the notional supplemental plan and after-tax amounts contributed to the prior non-registered savings plan.

Mr. Sheffield was not eligible to receive retirement benefits for his role as Interim President and CEO.

Includes the employer contributions, and investment gain/losses during 2022. For Mr. Poweska it also includes a withdrawal from the plan.

Compensation

Element

Resignation⁽¹⁾

Retirement⁽²⁾

Termination without
Cause⁽⁴⁾

Termination without
Cause following
Change in Control
(double trigger)⁽⁵⁾⁽⁶⁾

Termination
for Cause

The NEOs may voluntarily resign their employment at any time; Messrs. Lopez, Harricks, and Lebeter and Ms. Telford are required to give three (3) months notice. Under the terms of a retention agreement the Company has with Mr. Lopez, if he resigns, he will receive a prorated short-term incentive award and accelerated vesting of outstanding unvested cash-settled LTIP awards (at 100% of target performance).

All NEOs, with the exception of Mr. Lebeter, are considered to have ‘retired’ under the cash-settled LTIP if the retirement has been approved by the Board, the NEO complies with such conditions as the Board may require in connection with its approval, has given six (6) months prior notice, is paid no cash severance payment or retiring allowance or equivalent, and has complied with transitional activities as may be reasonably required during the period from the date of notice until the date the NEO ceases active employment. If these criteria are not satisfied, the termination of employment will be treated as a resignation, and the appropriate termination provisions will apply. For purposes of the LTIP, NEOs are considered to have retired if they reach age 65, reach age 55 with at least 10 years of service, or such lesser age and service threshold as the Board determines. For purposes of the STIP, NEOs are considered to have retired if they reach age 55 or such lesser age and service threshold as the Board determines. The Board has applied its discretion and approved the following retirement treatment for any unvested LTIP grants that Mr. Lebeter is holding at the time of his retirement in the event of his retirement after completion of:

three (3) years of continuous service and providing at least six (6) months’ notice of retirement, a portion of his unvested LTIP grants will continue to vest in accordance with the original vesting schedule and subject to actual performance terms of the grant. The proration will be based on time worked during the vesting period, and,

five (5) years of continuous service and providing at least six (6) months’ notice of retirement, all unvested LTIP grants will continue to vest in accordance with the original vesting schedule and subject to actual performance terms of the grant.

Mr. Lopez is entitled to 24 months of benefits continuation following termination of employment for any reason with the exception of termination for cause or reemployment. Hydro One does not ascribe a value for benefits continuation.

The payout multiplier for Messrs. Lopez, Harricks, and Lebeter and Ms. Telford is 1.5x, and benefits will continue for 18 months.

Treatment only applies to termination by the Company without cause or in the case of Messrs. Harricks, and Lebeter in the case of resignation, for good reason within 24 months following a change in control and only applies to awards made prior to the change in control. There is no entitlement to any benefit upon a change in control without a termination of employment from Hydro One. For Messrs. Harricks, and Lebeter “good reason” is defined as a material change in title, responsibilities, authority or “status”; a material change in base pay or a material change in STIP or LTIP target opportunity without the opportunity for alternative compensation.

A ‘change in control’ will occur in the following circumstances:

more than 50% of the outstanding voting securities of the Hydro One Limited are acquired;

all or substantially all of the assets of the Hydro One Limited are sold, assigned or transferred other than to a wholly-owned subsidiary;

an acquisition of the Hydro One Limited via merger, amalgamation, consolidation, statutory arrangement or otherwise or the dissolution or liquidation of the Company;

individuals who, at the beginning of any two-year period constitute the Board, cease to constitute a majority of the Board during such two-year period excluding any individuals whose service ceased due to death;

pursuant to its rights in the governance agreement, the Province replaces the entire board of directors of Hydro One Limited (other than the President and CEO) and, in its discretion, the chair of the Board;

a change is made to an Ontario law or regulation that:

both (A) expressly states that it applies either (1) to Hydro One Limited or an affiliate or (2) companies in the electrical transmission and/or distribution business generally but has a disproportionate effect on Hydro One Limited and its affiliates as a whole, and (B) would materially adversely affect the ability of Hydro One to achieve any corporate performance measures set out in any outstanding awards; or

imposes limits on the quantum of compensation that may be paid to non-union employees of Hydro One Limited or its affiliates other than restrictions established for rate approval or other purposes which do not restrict amounts actually paid; or

the Board passes a resolution confirming that a change in control has occurred.

If a participant has five (5) years of service and has not committed an act or has not failed to take any action, that has resulted or could damage the Company or its reputation, a pro rata portion of the participant’s awards will vest.

Name

William Sheffield⁽³⁾

Chris Lopez

Paul Harricks

David Lebeter

Megan Telford

Hydro One does not ascribe a value for benefits continuation.

Severance payments are calculated based on annualized base salary and the target short-term incentive as of December 31, 2022. The payout multiplier for the NEOs is 1.5x. For participants with at least five (5) years of service a pro rata portion of the participant’s outstanding LTIP has been included above. The Company does not ascribe a value for benefits continuation.

Due to the interim nature of his assignment, Mr. Sheffield’s employment agreement did not contain any termination provisions.

Role

Board chair

Committee chair⁽¹⁾

Other directors

Committee chairs receive a $5,140 retainer for their duties as committee chair. They can elect to take up to 100% of their retainer in the form of DSUs (as defined above).

2023 Compensation by Role

Board chair

Committee chair ⁽¹⁾

Other directors

Committee chairs receive a $5,350 retainer for their duties as committee chair. They can elect to take up to 100% of their retainer in the form of DSUs (as defined above).

Chair

Other Directors

Name

Cherie Brant

Blair Cowper-Smith

David Hay

Timothy Hodgson

Stacey Mowbray

Mark Podlasly

Russel Robertson

William Sheffield⁽²⁾

Melissa Sonberg

Susan Wolburgh Jenah

Total as a multiple of the share ownership requirement (“SOR”). Each director’s share ownership is calculated annually as at December 31 (based on the original grant value of director DSUs and the acquisition cost of Hydro One Limited’s common shares) and is divided by the share ownership requirement.

Mr. Sheffield remained subject to the director share ownership guidelines during his tenure as Interim President and CEO. Mr. Sheffield received 13,321 fully vested DSUs under the non-employee director DSU plan as part of his compensation for his interim role. Details of Mr. Sheffield’s compensation for service as a director and as Hydro One’s Interim President and CEO is disclosed starting on page S-2.

Total Compensation

Name

Cherie Brant

Blair Cowper-Smith

David Hay*

Timothy Hodgson

Total Compensation

Name

Jessica McDonald⁽³⁾

Stacey Mowbray*

Mark Podlasly

Russel Robertson*

Melissa Sonberg*

Susan Wolburgh Jenah*

Denotes committee chairs.

All amounts in this table are pre-tax. Amounts reported include the portion of the director’s board retainer, and committee chair retainer. The directors’ compensation set out in the chart was in compliance with the Hydro One Accountability Act for 2022.

All director DSUs (rounded) are fully vested upon grant. Values do not include the value of any additional DSUs received in the form of dividend equivalents.

Ms. McDonald did not stand for re-election at the June 8, 2022 Hydro One Limited annual general meeting.

Year ended December 31 (millions of dollars)

Net income attributable to common shareholders of Hydro One Limited

Impacts related to the ODC Decision

Adjusted net income attributable to common shareholders of Hydro One Limited