 EEI Financial Conference NOVEMBER 6, 2006 Energy / Growth / Leadership Exhibit 99.3 |
 2 Safe Harbor Provisions This presentation contains statements concerning NU’s expectations, plans, objectives, future financial performance and other statements that are not historical facts. These statements are “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. In some cases, a listener can identify these forward-looking statements by words such as “estimate”, “expect”, “anticipate”, “intend”, “plan”, “believe”, “forecast”, “should”, “could”, and similar expressions. Forward-looking statements involve risks and uncertainties that may cause actual results or outcomes to differ materially from those included in the forward-looking statements. Factors that may cause actual results to differ materially from those included in the forward-looking statements include, but are not limited to, actions by state and federal regulatory bodies; competition and industry restructuring; changes in economic conditions; changes in weather patterns; changes in laws, regulations or regulatory policy; expiration or initiation of significant energy supply contracts; changes in levels of capital expenditures; developments in legal or public policy doctrines; technological developments; volatility in electric and natural gas commodity markets; effectiveness of our risk management policies and procedures; changes in accounting standards and financial reporting regulations; fluctuations in the value of electricity positions; the methods, timing and results of the disposition of competitive businesses; actions of rating agencies; terrorist attacks on domestic energy facilities; and other presently unknown or unforeseen factors. Other risk factors are detailed from time to time in our reports to the Securities and Exchange Commission. We undertake no obligation to update the information contained in any forward-looking statements to reflect developments or circumstances occurring after the statement is made. |
 3 Agenda 2006 results and guidance Strategic transformation 2007 guidance 2007-2011 capital expenditures and rate base projections Distribution, PSNH regulated generation businesses Transmission business |
 4 2006 EPS Results and Guidance $1.70 $0.00 $1.33 $0.37 $0.00 $0.20 $0.40 $0.60 $0.80 $1.00 $1.20 $1.40 $1.60 $1.80 Regulated/Distribution Generation Transmission Parent Total Regulated/Parent $0.70 $1.28 $0.00 $0.20 $0.40 $0.60 $0.80 $1.00 $1.20 $1.40 Q3 YTD $1.23 $0.34 $1.57 Regulated/Parent Results* Regulated/Parent Guidance* *Results include third quarter $0.48/share benefit from CL&P private letter ruling Consolidated 2006 earnings guidance unchanged |
 5 Strategic Progress – Last Year’s Decision Divest all competitive businesses Focus on regulated utility infrastructure capital expenditure programs. Announced November 7, 2005 |
 6 Strategic Progress - Divestitures Northeast Utilities Electric Distribution Competitive Regulated Electric Transmission Regulated Generation Gas Distribution Retail Sold 6/1/06 Wholesale New England Contracts Divested 12/31/05 Services 5 of 6 Sold Generation Sold 11/1/06 We are nearly complete transforming ourselves into a 100% regulated utility |
 7 Strategic Progress: Investing In Regulated Businesses Transmission Bethel-Norwalk 100% complete Middletown-Norwalk 9% complete Glenbrook Cables under construction Long Island Cable under construction Distribution/Generation Northern Wood in final testing Waterbury LNG 85% complete $654 $766 $880 2004 2005 2006 Est. Regulated Capital Expenditures (in $ millions) Status of Major Projects |
 8 Benefits Of Transformation Simplified our business model and strategy Reduced our business risk and improved financial flexibility Capitalized on increasing valuation of generation Enhanced our earnings visibility Increased our focus on regulated infrastructure capital investment to meet customers needs Each reason provided a year ago has been validated We have: |
 9 The Next Five Years $1,217 $1,142 $890 $797 $896 2007 2008 2009 2010 2011 Projected Capital Expenditures $890* $926* $773* $778* *November 2005 projections |
 10 Rate Base Composition 2005 Rate Base Composition 2011E Rate Base Composition 2005 Rate Base: $3.3 billion 2011E Rate Base: $7.9 billion Rate Base: $605 million (Actual 2005) ’06-’11 Capex: $2.9 billion Rate Base: $2.25 billion (Actual 2005) ’06-’11 Capex: $2.5 billion Rate Base: $463 million (Actual 2005) ’06-’11 Capex: $0.3 billion Electricity Transmission Electricity Distribution & Generation Gas LDC Transmission to comprise much larger share of total rate base 18% 14% 68% Transmission Gas Dist. & Reg. Generation 38% 9% 53% Transmission Gas Dist. & Reg. Generation |
 11 $1.30 - $1.55/share in 2007 Compound annual EPS growth rate of 10-14% from year-end 2006 Dividend policy, earnings growth create attractive total shareholder return Guidance for 2007 and Beyond |
 12 NU’s Presence In New England Largest transmission owning IOU in New England Majority of the ISO identified transmission need is in the NU franchise National leader in transmission technology One of the largest landowners in New England Largest electric distribution utility in New England NU will continue to provide leadership in developing region’s energy policy |
 13 Additional Opportunities Not In This Forecast Transmission Regulated generation New technologies |
 14 Financial |
 15 Year-To-Date Results $83.8 ($344.1) ($239.9) $150.4 $43.6 ($73.7) $123.6 ($10.1) $30.5 $3.3 ($400.0) ($300.0) ($200.0) ($100.0) $0.0 $100.0 $200.0 Distribution/ Regulated Generation Transmission Parent Competitive Total $76.4 2005 2006 $83.8 ($344.1) ($239.9) $150.4 $43.6 ($73.7) $123.6 ($10.1) $30.5 $3.3 ($400.0) ($300.0) ($200.0) ($100.0) $0.0 $100.0 $200.0 2005 |
 16 Third Quarter Regulated Results $16.9 $3.7 $26.9 $84.4 $5.8 $2.8 $87.7 $10.5 ($4.2) ($5.3) ($10.0) $0.0 $10.0 $20.0 $30.0 $40.0 $50.0 $60.0 $70.0 $80.0 $90.0 $100.0 CL&P PSNH WMECO Yankee Total $9.2 $1.1 $15.2 $2.1 $0.9 $11.8 $1.5 $18.2 $0.0 $2.0 $4.0 $6.0 $8.0 $10.0 $12.0 $14.0 $16.0 $18.0 $20.0 CL&P PSNH WMECO Total Regulated Distribution And Generation Transmission Results higher due to transmission, lower CL&P tax expense $10.4 $13.7 2005 2006 |
 17 2006-2007 EPS Projections Distribution/Regulated Generation $0.75 - $0.85 $0.80 - $0.90 Transmission $0.34 - $0.37 $0.50 - $0.60 Parent/Other Affiliates Breakeven $0.00 - $0.05 Competitive N/A Breakeven Total $1.09 - $1.22 $1.30 - $1.55 *2006 results exclude $0.48 effect of CL&P Private Letter Ruling and exclude competitive results 2006 EPS* 2007 EPS |
 18 2007 and 2008 Earnings Drivers Distribution Regulated Generation Transmission Parent Competitive Business Drivers • Rate base growth • Electric and gas retail sales up about 1% • Operating costs Regulatory Drivers • WMECO rate settlement • PSNH, Yankee Gas rate case outcomes • CL&P 1/1/07 $7 million rate increase • CL&P rate case outcome (2008 only) • Progress on major and routine projects • Impact of last week’s New England ROE order • Management of wholesale supply and capacity purchase contracts through exit • Interest from cash on generation sale offsetting interest costs • NU corporate service companies |
 19 2007-2011: Capital Expenditures and Depreciation $0 $200 $400 $600 $800 $1,000 $1,200 $1,400 Five-year 2007-2011 capital spending of $4.9 billion, compared with last year’s 2006-2010 $4.3 billion plan Distribution Capex From 11/05 Forecast Transmission Capex From 11/05 Forecast Distribution Capex From 11/06 Forecast Transmission Capex From 11/06 Forecast 2006 Est. 2007 Est. 2010 Est. 2011 Est. 2008 Est. 2009 Est. $880* $779* $875* $1,199* $1,124* $880* N/A $864 $890 $926 $778 $773 *Excludes approximately $18 million per year at corporate service companies |
   20 Projected Combined Rate Base $1,072 $1,776 $2,337 $2,531 $2,726 $2,995 $3,465 $3,979 $4,249 $4,474 $4,711 $4,909 $0 $1,000 $2,000 $3,000 $4,000 $5,000 $6,000 $7,000 $8,000 $9,000 2006 Est. 2007 Est. 2008 Est. 2009 Est. 2010 Est. 2011 Est. Electric Transmission Regulated Distribution and Generation Target Utility Capitalization Structure = 45% equity, 55% debt Recently FERC Authorized Transmission ROE = 11.4%-12.4% Projected PUC Authorized Cost of Capital Distribution ROE = 9% -10% $5,755 $7,005 $6,586 $7,437 Regulated Rate Base 2006-2011 CAGR of 12% $4,531 $7,904 Supports EPS CAGR of 10-14% Projected Distribution & Generation Rate Base CAGR of 7% Transmission Rate Base 2006-2011 CAGR of 23% |
 21 Projected Uses Financing The Growth: 2007 Projected Sources • Cash from generation sale: $1 billion • Regulated company long-term debt issuances: $600-$700 million • Cash from operations: $500-$600 million • Capital expenditures: $1.2 billion • Taxes on generation sale: $450-$500 million • Short-term debt reduction: $300-$400 million • Dividends: $125 million Cash from generation sale helps to comfortably fund requirements |
     22 Financing The Growth: 2007-2011 $2.5 Billion Cash from Operations $3 Billion New Issuances, and Cash from Generation Sale $5.5 Billion Projected Capital Expenditures and Dividends NU will meet its cash needs almost exclusively from internal sources and debt financings |
 23 Capitalization at September 30, 2006 ($ millions) NU’s leverage comfortably within its targets 1.9% $2,957 $304 $320 $2,473 $116 Long-Term Debt Common Equity NGC Debt Short-Term Debt Preferred Stock 5.2% 47.9% 40.1% 4.9% 1.9% |
 24 Distribution and Generation |
 25 Key Issues For Next Fourteen Months Successful distribution rate cases Addressing reliability challenges resulting from strong peak load growth, aging equipment Managing the business in a modest sales growth environment Bringing major projects into commercial operation 2007 will be a pivotal year for distribution businesses |
 26 CL&P Rate Case Distribution only Transmission, federally mandated charges, supply costs tracked through other charges To be filed around 7/1/07 New rates to be implemented by 1/1/08 Need to improve ROE level Distribution capital spending will be an important item CL&P distribution earnings will lag until 2008 rate relief |
 27 Peak Load Growing Much Faster Than Overall Consumption 0.9 1.0 1.1 1.2 1.3 1.4 1.5 Residential Use Per Customer Summer Peak 0.9 1.0 1.1 1.2 1.3 1.4 1.5 1.6 Residential Use Per Customer Summer Peak CL&P Residential Use Per Customer and Summer Peak Weather Normalized PSNH Residential Use Per Customer and Summer Peak Weather Normalized Residential customer growth remains steady, at roughly the rate of housing growth Residential use per customer has flattened in response to price induced conservation Growth in peak demand outpaces growth in use per customers, as comfort during extreme weather appears to outweigh cost Load factors continue to fall as peak loads rise |
 28 WMECO Rate Case Filed joint settlement with AG and other parties on October 19 $1 million distribution increase on 1/1/07; $3 million distribution increase on 1/1/08 New trackers for pension, other post-retirement benefits, and certain uncollectibles and capital investment Annual transmission tracker already in place 9-10 percent ROE achievable WMECO rate settlement a fair resolution |
 29 PSNH Rate Case Filed in May 2006 for $49 million annualized permanent rate increase Interim $24.5 million temporary rate increase effective 7/1/06 Overall bill declined 15 percent due to lower stranded cost recovery, and energy service charges If fully litigated, final decision retroactive to 7/1/06 Settlement discussions in late 2006/early 2007 Hearings will commence in March if settlement not reached Transmission tracker sought Increased transmission costs represent $11 million of requested increase PSNH distribution request modest compared with recent overall rate reduction |
 30 Average Electric Rates Other includes C&LM, CTA, Stranded Costs, Consumption Tax, SBC, DSM, Transition and Renewables. Average Rates as of 8/1/06 for CL&P, 10/1/2006 for WMECO and 7/1/06 for PSNH PSNH rates now lowest in New England Total = 16.11 Total = 14.49 Total = 13.27 1.34 1.91 0.72 0.48 2.75 2.90 2.70 9.47 10.36 8.18 1.83 0.80 0.43 0 2 4 6 8 10 12 14 16 18 CL&P WMECO PSNH Other Transmission Distribution Energy FMCC |
 31 Yankee Rate Case To be filed around 1/1/07 and effective around 7/1/07 Reflecting LNG facility in base rates key item Annual cost likely to be offset by lower commodity, pipeline capacity charges Additional rate relief needed to improve Yankee returns, account for sales decline Capital expenditures will decline sharply after LNG completed Yankee financial performance expected to improve beginning with third quarter 2007 |
 32 Major Projects Yankee Gas’s 1.2 Bcf liquid natural gas production facility in Waterbury, CT $108 million cost About 85 percent complete Scheduled to be in service for 2007- 2008 heating season Will enhance reliability, help insulate customers from price volatility Conversion of PSNH’s 50 MW Schiller unit in Portsmouth, NH from coal to wood $75 million cost In final testing Commercial operation by January Enhances fuel diversity, reduces sulfur, NOx, mercury emissions |
 33 Future Regulated Generation Opportunities Under Way: • Legislation to install scrubber at Merrimack approved in spring 2006 • Projected completion: Mid-2013 • Estimated cost: $250 million The Future: • Connecticut legislature may review generation legislation in 2007 • New Hampshire likely to look at additional biomass opportunities Potential new generation not reflected in long-term growth forecasts |
 34 Transmission |
                35 About Northeast Utilities Transmission… 2,995 322 245 2,428 Projected 12/31/11 Rate Base ($ Millions) 1,072 191 3,258 Total NU 134 52 1,003 PSNH 76 36 489 WMECO 862 103 1,766 CL&P Projected 12/31/06 Rate Base ($ Millions) Transmission Substations Transmission Circuit Miles Operating Company Comparative Ranking of NU (miles) • Largest in New England • 4th largest in 11 northeast states • Nearly 2.4 million retail customers • Over 140 miles of new transmission planned |
 36 2006 Transmission Highlights Our transmission system operated well over the summer Peak load grew by more than 4% in New England in 2006 Peak load grew by 14% (3,000 MW) in New England since 2003 We have maintained excellent safety and environmental records Project construction remains on-time and on-budget Capital spending on target for $454.5 million in 2006 2006 plant-in-service projected to be $390 million -- $10 million greater than budget We have completed and energized the $340 million Bethel-Norwalk project as of October 12, $10 million under budget Completion of projects will result in significant cost savings for customers We are well-prepared for the implementation of the Energy Policy Act’s new reliability standards |
 37 NU’s Transmission Revenue Requirements are 100% FERC Regulated NU’s FERC-approved transmission tariffs fully track all transmission costs We have forward-looking rates, adjusted every six months, with an annual true-up provision to ensure timely recovery of transmission investment FERC ROE decision issued October 31, 2006 |
 38 Four Major SW Connecticut Projects – A $1.65 Billion Investment SWCT improvements have been a top priority in each of ISO-NE’s last four regional transmission expansion plans. Our four major projects there total about $1.65 billion in investment. 50% of CT Load Bethel-Norwalk 345 kV Underground & Overhead $350 Million 21 miles 345kV (56% underground) 10 miles 115kV (100% underground) Completed October 2006 at a cost of $340 million Middletown-Norwalk 345 kV Underground & Overhead $1,047 Million (NU Share) Glenbrook Cables 115 kV underground $183 Million 9 miles 115kV underground Projected in-service date: 2008 Under contract – construction under way Long Island Cable 138 kV cross sound $72 Million (NU share) 11 miles 138kV submarine cable Joint project with LIPA Projected in-service date: 2008 Under contract – cable being built 69 miles 345kV (35% underground) 57 miles 115kV (1% underground) Joint project with United Illuminating Construction under way, 9% complete; projected in-service date 2009 |
 39 Under Construction ISO-NE Approved Future Regional System Plan Projects Legend Complete Manchester-Hopewell Oxford Substation Fitzwilliam Substation Barbour Hill Substation Frost Bridge Corridor Gosling Road Substation Berkshire Solution Springfield Solution Southern New England Transmission Reinforcement (SNETR) Deerfield Autotransformer Windsor Substation Southeast CT Solution Weare Substation Madbury Capacitor Scobie Substation Tioga Woodland Capacitor Pleasant Capacitor Haddam Autotransformer Bethel - Norwalk Glenbrook Statcom Shunock Substation Glenbrook Cables White Mountain Upgrade Northeastern Connecticut Middletown - Norwalk Long Island Replacement Cable (LIRC) Plumtree - Triangle Norwalk Harbor Substation Controls Scobie – Hudson Line Timber Swamp NU is a Major Part of New England’s Transmission Infrastructure Upgrade 55% NU 14% NGRID 12% Vermont 9% NST 6% UI 3% Bangor Hydro 1% Central Maine Power Source: ISO-NE’s 2005 Regional System Plan |
   40 The Next Five Years: Transmission Capital Expenditures $0.00 $100.00 $200.00 $300.00 $400.00 $500.00 $600.00 $700.00 $800.00 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 Other SNETR Major CT Historic Forecast Up To $2.4 Billion • The Southern New England Transmission Reinforcement family of projects is growing in scope and definition. • Over the next three years, a high level of capital spending is associated with projects that have already received siting approval. $1,062 Million $1.1 Billion of major CT projects in 2007-2011 forecast period; $1.65 billion in total SNETR family of projects estimated at $710 million during the 2007- 2011 forecast period |
 41 Southern New England Transmission Reinforcement Projects Are the Next Major Undertaking Planning Construction Siting 2005 2005 2006 2007 2008 2009 2009 2010 2010 2011 2011 2012 2012 2013 2013 The SNETR projects solve four area problems: 1. Interstate transfer capability 2. Connecticut East-West transfer capability 3. Springfield Reliability 4. New England East-West transfer capability 2006 Activities: • Complete planning studies • Analyze routing options 2007 Activities: • Finalize siting plans and file applications in Connecticut and Massachusetts • ISO-NE technical approval 1 4 3 2 |
 42 Looking Beyond the Five-Year Horizon The Southern New England Transmission Reinforcement family of projects will be our next major undertaking ISO-NE’s Regional System Plan has identified longer-term projects within our franchise ISO-NE is planning beyond the 30 GW grid to a 50 GW grid Providing added transfer capacity between Maine and New Hampshire Strengthening ties and transfer capability between southern New Hampshire and Massachusetts FERC/NERC mandatory reliability standards may create new projects Serving future load growth and meeting redundancy requirements Emerging technologies including smart grid investment Replacement of aging equipment will be increasingly important ISO-NE is evaluating stronger interconnections with Canada |
 43 NU’s Transformation Producing Solid Results, Prospects Strategic plan elements announced one year ago are on or ahead of schedule Financial flexibility is significantly improved Transmission business is growing rapidly to meet customer needs Distribution results expected to improve with reasonable rate case outcomes NU has a leadership role in meeting New England’s energy challenges |
 44 Questions and Answers |
 Appendix |
   46 Projected Transmission Year-End Rate Base $862 $2,073 $2,180 $2,428 $134 $172 $273 $279 $332 $322 $76 $84 $137 $179 $214 $245 $1,927 $1,520 $0 $500 $1,000 $1,500 $2,000 $2,500 $3,000 $3,500 2006 2007 2008 2009 2010 2011 CL&P PSNH WMECO Transmission Rate Base 2006-2011 CAGR of 23% |
   47 Projected Distribution and Regulated Generation Year-End Rate Base $1,790 $1,991 $2,116 $2,254 $2,393 $2,499 $837 $953 $1,073 $1,135 $1,207 $1,275 $341 $365 $384 $408 $424 $438 $497 $670 $676 $677 $687 $697 $0 $500 $1,000 $1,500 $2,000 $2,500 $3,000 $3,500 $4,000 $4,500 $5,000 2006 2007 2008 2009 2010 2011 CL&P PSNH WMECO Yankee Gas Projected Distribution & Generation Rate Base CAGR of 7% |
 48 Projected Distribution Capital Expenditures $206 $271 $260 $266 $270 $279 $105 $128 $134 $112 $128 $148 $28 $34 $32 $31 $31 $31 $86 $62 $42 $41 $41 $41 $0 $100 $200 $300 $400 $500 $600 2006 2007 2008 2009 2010 2011 CL&P PSNH WMECO Yankee Gas |
 49 Projected Transmission Capital Expenditures $420 $600 $517 $343 $231 $333 $87 $85 $37 $35 $6 $54 $45 $43 $42 $25 $17 $10 $0 $100 $200 $300 $400 $500 $600 $700 $800 2006 2007 2008 2009 2010 2011 CL&P PSNH WMECO |
 50 2007-2011: Capital Expenditures and Depreciation $766 $880 $1,217 $1,142 $890 $797 $896 $320 $309 $303 $290 $265 $234 $215 $0 $200 $400 $600 $800 $1,000 $1,200 $1,400 2005 Actual 2006 Est. 2007 Est. 2008 Est. 2009 Est. 2010 Est. 2011 Est. Regulated Capex (Incl. AFUDC) Depreciation Significant capital spending in 2007-2008 *Includes approximately $18 million per year at corporate service companies |