HYDRO ONE INC. 2023 STATEMENT OF EXECUTIVE COMPENSATION - Form 6-K

BACKGROUND

COMPENSATION DISCUSSION AND ANALYSIS

Named Executive Officers

Name

Title

Mr. Lebeter assumed the position of President and CEO on February 1, 2023.

Mr. Lopez decided to leave the organization on June 30, 2024.

Mr. Harricks became a Senior Advisor on April 13, 2023 and continued in this capacity until his retirement on December 31, 2023.

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

Compensation Philosophy and Practices

Compensation Guiding Principles

Principle

Objective

Executive Compensation Framework

Compensation Governance

Human Resources Committee

Melissa Sonberg (chair)

Mark Podlasly

Human Resources Committee:

Stacey Mowbray

Helga Reidel

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

•  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 the 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.

2023 Accomplishments and Highlights include:

Reviewed:

•  enterprise risk management updates;

•  regular people strategy updates, including initiative spotlights;

•  2023 HRC Committee Work Plan;

•  quarterly Code of Business Conduct and ethics and Whistleblower Policy updates;

•  incentive compensation information and benchmarking;

•  executive shareholdings against Hydro One Limited's share ownership guidelines;

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

•  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 including effectiveness metrics;

•  employee survey results;

•  a compensation risk assessment;

•  Code of Business Conduct and Ethics Office Report; and

•  2024 individual performance scorecards for the President and CEO and Designated Employees.

Reviewed and approved:

•  2023 Executive Merit Increase Budget - excluding the President and CEO and Designated Employees;

•  2022 DBPP, DCPP and year-end financial statements and DBPP statement of investment policies and procedures;

•  the Company's DEI commitment statement;

•  updates on our labour strategy;

•  the new peer group;

•  DBPP and DCPP reports;

•  labour strategy;

•  2024 HRC Committee Work Plan; and

•  Hydro One Pension Plan Statement of Investment Policies and Procedures.

Reviewed and recommended:

•  President and CEO's position description;

•  amended committee mandate;

•  2022 STIP corporate scorecard results and performance multiplier;

•  2022 aggregate individual performance multiplier - excluding the CEO and Designated Employees;

•  2023 short-term incentive plan ("STIP") scorecard;

•  2023 long-term incentive plan ("LTIP") performance measures;

•  2022 STIP for the President and CEO;

•  2023 LTIP grant for management, Designated Employees and the President and CEO;

•  2020 LTIP performance multiplier;

•  management information circular compensation discussion and analysis;

•  the President and CEO succession plan;

•  Compensation Recoupment Policy;

•  LTIP grants for new hires or promotions;

•  2024 LTIP off-cycle pool;

•  Employee Share Ownership Plan ("ESOP") amendments;

•  2024 target total compensation structure for the CEO;

•  2024 Management Merit Increase Budget;

•  2023 Power Workers Union ("PWU") and Society Share Grants;

•  Human Resources Committee Mandate - recommended to the GRC;

•  Code of Business Conduct - recommended to GRC;

•  Whistleblower Policy - recommended to GRC;

•  Executive Rewards Program;

•  Interim President and CEO performance and compensation;

•  ELT status update and ELT employment agreements; and

•  President and CEO and EVP supplemental executive retirement plan ("SERP").

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 publicly listed company or major organization).

Compensation Advisors

Compensation Advisor

Mercer (Canada) Limited

In 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 was not related to executive compensation. While the HRC was not required to approve work related to the OEB benchmarking study prior to completion, the work was 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 2022 or 2023 for work requested by the HRC or the Board.

Risk Management Process

Compensation Practices

Practice

Description

Executives are prohibited from engaging in transactions 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

applies to cash bonuses, stock options, performance share units ("PSUs"), restricted share units ("RSUs"), other equity-based compensation and performance cash-settled LTIP awards, whether vested or unvested, including those which have been paid or settled.

In 2023, Hydro One Limited and Hydro One Inc. each updated its clawback policy ("Recoupment Policy") in compliance with the requirements of the Securities Exchange Act of 1934 and the listing standards of the New York Stock Exchange. In the event of an accounting restatement and except in very narrow circumstances, Hydro One Limited and Hydro One Inc. will be required to recover certain incentive-based compensation paid to certain executive officers on or after October 2, 2023, to the extent such incentive-based compensation was paid on the basis of financial results in respect of any of Hydro One Limited and Hydro One Inc.'s three most recently completed fiscal years preceding the restatement.

The Recoupment Policy continues to apply in all other cases and applies to a broader group of employees of Hydro One Limited and its subsidiaries. In addition, the broader clawback policy (i) permits the Board to exercise its discretion in determining whether to recoup the incentive compensation; (ii) applies to a wider range of compensation and circumstances; and (iii) only recoups the after-tax amounts. In the event that both the Recoupment Policy and the pre- existing clawback policy apply, amounts recovered under one policy shall be credited to the amount that is subject to recovery under the other policy, such that there should not be any duplicative recovery.

Hydro One sets targets that are challenging, yet fair, and considers our strategy and business plan without encouraging excessive risk-taking. 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. No such adjustments occurred in 2023.

Practice

Description

Individuals have until the fifth anniversary (reduced from seven years in 2023) of the later of their start date, promotion to a level with a higher share ownership requirement, or the date they became subject to the guidelines, to meet their applicable share ownership requirement. If an executive has not met their requirements by the compliance deadline, they must receive some or all of their STIP award in management DSUs and/or apply 25% of the net after tax benefit realized by the settlement of any LTIP awards to purchase Hydro One Limited's common shares.

The Company's 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, 50% of the value of equity-settled PSUs and 25% of the value of outstanding cash-settled LTIP is counted during the vesting period. Annually, the HRC reviews compliance of the Company's executives with Hydro One Limited's share ownership guidelines. The inclusion of cash-settled LTIP grants will cease once the last grants vest in 2025. The inclusion of equity-settled PSUs with 100% performance-based payouts for the President and CEO and EVPs reflects the highly performance-oriented nature of the LTIP where no time-vesting only units were provided to NEOs in 2023, and the PSUs provide directional alignment with Hydro One Limited's share price.

Environment, Social and Governance ("ESG")

Management

HRC

Independent Compensation

Advisors

Board

Recommends the President and CEO's target compensation to the Board for approval

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

Assists the HRC in

developing target compensation

Management

HRC

Independent Compensation

Advisors

Board

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

Reviews and approves performance of the President and CEO's ELT direct reports

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

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

Compensation Peer Group Selection Criteria

Hydro One's 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 being a publicly-traded company with significant investment by the Province of Ontario (the "Province");

the particular considerations inherent with highly regulated organizations having large societal impact; and

the limited number of comparable electricity transmission and distribution service providers in Canada.

Primary Compensation Reference Peer Group

Publicly-Traded Sector Peers

Public Sector Peers

Evergy, Inc.

Fortis Inc.

Gibson Energy Inc.

Keyera Corp.

Pembina Pipeline Corporation

TransAlta Corporation

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

Total assets and total revenues of Hydro One Limited are calculated using data for the most recently reported 12-month period ending December 31, 2023 and market capitalization and total enterprise value of Hydro One Limited are calculated as at December 31, 2023.

The market capitalization of Hydro One Limited was approximately $23.8 billion and the total enterprise value of Hydro One Limited was approximately $39.3 billion as at December 31, 2023.

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

Components and Decisions of 2023 Compensation

Component

Form

Objectives

•  Attract and retain highly qualified and experienced executives

•  Provide a predictable and steady income

Defined Contribution Pension Plan

Defined Benefit Pension Plan

Supplemental Executive Retirement Plan ("DC SERP" or "Supplemental Plan")

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

Benefits

Group health, life, disability benefits, and executive wellbeing account

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

•  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 of Hydro One Limited common shares and increase alignment with shareholders' interests

Target Compensation Mix

NEO

Rationale for Change

David Lebeter

Chris Lopez

Andrew Spencer

Megan Telford

Paul Harricks

These columns reflect the NEOs' base salaries as of December 31 of the relevant year, and do not take into account any proration for base salary changes during fiscal years 2022 and 2023, respectively. Mr. Sheffield held his position of Interim President and Chief Executive Officer from June 21, 2022 to February 1, 2023 and was eligible for a salary of $66,000 per month.

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

How the Award is

Determined

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.

Corporate

Performance

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.

See pages S-18 to S-20 for more information about the performance measures and results related to the Company's corporate scorecard.

Individual

Performance

HRC/Board

Judgment

Elements of the

Short-Term Incentive

Plan

Impact on Award

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

Health and Safety: While Hydro One's safety results for the year (0.562 Recordable Incidents per 200,000) demonstrate improvement, there is room for continued progress. In 2023, two employees sustained a high-energy serious injury ("HSIF") compared to one in 2022. This equates to an HSIF rate of 0.023 per 200,000 hours, which exceeded (is lower than) the Company's annual target. Together, these results continue to reflect consistent progress made in preventing life-altering injuries and fatalities.

Productivity: Hydro One is pleased to have achieved $113.9 million in productivity savings in 2023. Hydro One saw meaningful increases in productivity in areas such as operations and supply chain management. Through these achievements, Hydro One is delivering on its multi-year commitment to keep costs as low as possible.

Reliability: Transmission ("Tx") reliability significantly improved in 2023 with fourth quarter performance being the best in the past ten years due to favorable weather and a focus on implementing changes learned from post-event investigations. Distribution ("Dx") reliability results fell short of target, in part because of the severe storms experienced during the year.

Work Program: Hydro One continued to execute on its investment plan as Tx in-service additions were 4.5% better than 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.

Net Income: 2023 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.

Customer: Year-end overall favourable impression of 82% was lower than the Company's threshold and we have implemented an organization-wide focus to improve the customer experience.

NEO

Key Accomplishments

David Lebeter

President and CEO

As the President and CEO, Mr. Lebeter is responsible for setting and executing on the Company's strategic vision. As the President and CEO, Mr. Lebeter sits on the Board.

In his first year as President and CEO, Mr. Lebeter provided strategic and executive leadership in the following areas:

•  Continued the Company's strong safety record, exceeding our best- in-class recordable injury rate with a year end result 0.562 per 200,000 hours.

•  HSIF rate of 0.023 per 200,000 hours, continuing our commitment to zero.

•  Oversaw the refresh of the Company's corporate strategy, including our purpose and vision.

•  Promoted three strong internal leaders to the ELT and developed new accountabilities across leaders, focusing the organization on preparing for the energy transition.

•  Continued realization of productivity savings of $113.9 million in 2023. Secured three new transmission lines for development and construction.

•  Executed $142.3 million of spend with Indigenous partners in 2023, an increase of 48% over the prior year of $95.9 million.

•  Executed labelled bond issuances at attractive interest rates via three sustainable bond tranches and three green bond tranches in 2023.

•  Conducted extensive shareholder and investor relations outreach.

NEO

Key Accomplishments

•  Acquired a local distribution company in northern Ontario.

•  Continued to advance partnerships with Indigenous communities, including the signing of a Letter of Intent.

Chris Lopez

EVP, Chief Financial and Regulatory Officer

As EVP, Chief Financial and Regulatory Officer, Mr. Lopez is responsible for the corporate finance and regulatory practices function, including treasury, tax, internal audit, investor relations, risk and pensions. In addition, Mr. Lopez is responsible for shared services including supply chain, facilities and real estate, growth, and mergers and acquisitions.

Mr. Lopez provided strategic and executive leadership in the following areas:

•  Executed the growth plan and helped achieve strong 2023 financial results with an earnings per share of Hydro One Limited ("EPS") of $1.81, an increase of 3% over the prior year of $1.75.

•  Successful implementation of the first year of the initial joint rate application, which was approved by the OEB in 2022.

•  Release of the Sustainable Financing Framework in early 2023, within which $2.375 billion of green or sustainable bonds were issued.

•  Maintained strong credit ratings, including a positive outlook from S&P during the year.

•  Improved debtholder and Hydro One Limited shareholder perception scores over previous survey.

•  Filed five Leave to Construct Applications with the OEB, including our Waasigan Transmission Line.

•  Advancement of acquisition strategy including a definitive agreement signed and appropriate regulatory applications filed for the acquisition of Chapleau Public Utilities Corporation.

•  Grew underlying business and materially enhanced network reliability of Ivy Charging Network.

•  Continued enhancement of Shared Services functions including supply chain, facilities and real estate, and fleet services, which has enabled the Company to execute on a growing work program while exceeding safety targets in the Shared Services team.

Andrew Spencer

EVP, Capital Portfolio Delivery

NEO

Key Accomplishments

•  Applied the Hydro One First Nations Equity Partnership Model on qualified new major transmission capital projects and increased Indigenous procurement and negotiated economic participation agreements with Indigenous partners in Ontario.

•  Enabled large new customer connections and continued development and execution of nine transmission lines and associated station upgrades across Ontario.

•  Delivered on the Capital Work Program, effectively expanded new facilities and reinvested in Hydro One's existing infrastructure and contributed to the successful delivery of the Company's capital expenditures of $2,531 million and In-Service Additions of $2,324 million in 2023.

•  Accountable for the Advanced Metering Infrastructure upgrade project (AMI 2.0).

•  Implemented extended forecasts of material needs to improve efficiency and collaborated with supply chain to utilize new inventory mechanisms and qualify new suppliers and manufacturing facilities.

•  Progressed on climate change objectives; led Hydro One's climate change mitigation and adaption programs, and accountable for the Company's environmental managed systems.

•  In an interim capacity, acted as the EVP, Digital & Technology Solutions.

Megan Telford

EVP, Strategy Energy Transition and Human Resources

As EVP, Strategy, Energy Transition and Human Resources, Ms. Telford is responsible for strategy, planning, partnerships, sustainability, corporate affairs and human resources.

Ms. Telford provided strategic and executive leadership in the following areas:

•  Led the efforts to update and refresh Hydro One's organizational strategy, including the design and implementation of the new mandates aligned to the strategy.

•  Supported a multi-faceted grid modernization strategy designed to further Hydro One's customer focus through the enablement of distributed energy resources, grid scale and residential batteries, and electric vehicle modeling.

•  Partnered with stakeholders to address the energy needs of large-scale industrial customers to further economic growth in the Province.

•  Reinforced Hydro One's commitment to creating new opportunities to maximize Indigenous participation in the energy sector by engaging in strategic partnerships with numerous First Nations across Ontario.

.

NEO

Key Accomplishments

•  Championed the continued evolution of Hydro One's strong culture, through the execution of initiatives in support of Hydro One's People Strategy, which saw the Company achieve record employee engagement scores in 2023 and be recognized as one of Canada's Best Employers for 2023 by Forbes.

•  Oversaw the successful completion of bargaining with Hydro One's two largest unions, the PWU and Society of United Professionals resulting in agreements that further mutual objectives and foster collaboration towards shaping the workforce of the future.

STIP Decision Summary

Named Executive Officer/

Principal Position⁽¹⁾

David Lebeter

President and CEO

Chris Lopez

EVP, Chief Financial and Regulatory Officer

Andrew Spencer

EVP, Capital Portfolio Delivery

Megan Telford

EVP, Strategy, Energy Transition and Human Resources

Paul Harricks

Former Chief Legal Officer

All NEOs are eligible for STIP with the exception of Mr. Sheffield.

Incentive target as of December 31, 2023.

Long-Term Incentive Plan

attract and retain highly qualified and experienced talent;

foster alignment with shareholder interests;

reward executives for longer term value creation; and

provide market competitive compensation.

EPS, which rewards executives for delivering increased earnings to shareholders of Hydro One Limited and includes the requirement that the Hydro One Limited dividend does not decrease in any rolling 12 months during the performance period; and

Relative total shareholder return ("TSR"), which rewards executives for achieving Hydro One Limited 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

Equity-Based LTIP: An award that will be settled in common shares of Hydro One Limited in the future, subject to the achievement of specified performance criteria.

PSUs: Subject to performance and time vesting criteria and are fully-at risk. Form 100% of the LTIP awards for the President and CEO and EVPs.

RSUs: Subject to time vesting criteria and are only granted below EVP level.

Each PSU granted in 2023 is 100% performance based, subject to achieving certain performance levels for the period from January 1, 2023 to December 31, 2026 (the four-year "Performance Period"):

(1)   four-year average EPS (subject to a dividend rate modifier) - 75% weighting; and

(2)   four-year relative TSR (S&P/TSX Capped Utilities Index) - 25% 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.

Four-year average EPS: The 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 modifier: 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.

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 index was selected for comparison as it reflects an established grouping of Canadian publicly traded industry peers for Hydro One Limited.

Named Executive Officer⁽¹⁾

David Lebeter

Chris Lopez

Andrew Spencer

Megan Telford

Paul Harricks

William Sheffield

All NEOs are eligible for equity-settled PSUs 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 option-based awards were granted in 2023.

No cash-settled awards were granted in 2023.

Previous grants are not taken into account when considering new grants.

The LTIP productivity results over the 2021 to 2023 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-settled LTIP payouts for the President and CEO and EVPs who were NEOs in 2021 are capped at 100% of target.

Pension Benefits

Defined Contribution Pension Plan ("DCPP")

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.

Element

Description

Element

Description

Defined Benefit Pension Plan ("DBPP")

Element

Description

maximum pensionable earnings during the 60 consecutive months for non-union employees hired prior to January 1, 2004 when their base earnings were highest. The reduction is intended to offset Canada Pension Plan benefits. The DBPP provides for early retirement with an unreduced pension at the earlier of age 65 or the attainment of age plus credited service totaling 82 (changing to 85 as of April 1, 2025 for anyone who has not reached 82 points on that date) or more.

A plan member who is not eligible for an unreduced pension can retire with a reduced pension any time after attaining age 55. Pension benefits payable to pensioners, beneficiaries and terminated employees with deferred pensions are increased annually, effective January 1 of each year equal to 100% of the increase in the Consumer Price Index (Ontario) for the 12-month period ending in June of the previous year. The normal form of pension for a member who does not have a spouse at retirement is a pension payable for life and guaranteed for five years. The normal form of pension for a member who has a spouse at retirement is a pension payable for the life of the member, and continuing after the member's death to their spouse at the rate of 66.67% of the member's normal form.

Management Employee Share Ownership Plan ("Management ESOP")

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

Element

President and CEO

EVPs

Equity-based Long-Term Incentive Plan

PSUs. A PSU entitles the participant to receive common shares of Hydro One Limited following the achievement of specified performance- and time-vesting conditions. The HRC has the authority to determine at the time of grant, in its sole discretion, the duration of the vesting period and other vesting terms applicable to the grant of PSUs. The HRC may elect to settle PSUs in cash.⁽¹⁾

RSUs. A RSU entitles the participant to receive common shares of Hydro One Limited following the achievement of specified time-vesting conditions. The HRC shall have the authority to determine at the time of grant, in its sole discretion, the duration of the vesting period and other vesting terms applicable to the grant of RSUs. The HRC may elect to settle RSUs in cash.⁽¹⁾

The LTIP also contemplates the possibility of grants of:

•  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 on the date of grant. Standard four year vesting unless otherwise specified by the HRC. The term of an option may not exceed 10 years.

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

•  DSUs. A 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. Management DSUs are granted under a separate cash-settled plan.

•  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. Standard four year vesting unless otherwise specified by the HRC. The term of a SAR may not exceed 10 years.

•  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 Limited and its affiliates (including Hydro One) as determined by the HRC.

Non-employee directors on the Board are not eligible.

11,900,000 common shares of Hydro One Limited or approximately 2% of the issued and outstanding common shares of Hydro One Limited. Within that limit the maximum number of common shares of Hydro One Limited which may be issued as PSUs, RSUs or DSUs is 4,760,000 common shares (or approximately 0.79% of the issued and outstanding common shares of Hydro One Limited as of December 31, 2023). As of December 31, 2023, there were 8,472,285 common shares available for future awards (approximately 1.41% of the issued and outstanding common shares of Hydro One Limited).

If an award expires without exercise, is cancelled, forfeited or terminated or otherwise is settled without the issuance of common shares of Hydro One Limited, the common shares of Hydro One Limited which were issuable under the award will be available for future grants. Common shares of Hydro One Limited issued under awards of an acquired company that are converted, replaced or adjusted in connection with the acquisition will not reduce the number of shares available for awards under the LTIP unless otherwise required by law or stock exchange rule.

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 granted more than six months prior to the receipt of the notice to retire will continue to vest and are settled and exercised in accordance with their terms. Other unvested awards will be forfeited.⁽¹⁾

"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 Boardmay 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 theplan 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 byHydro One until the date the individual has ceased active employment.

A prorated portion of the next instalment of any awards due to vest will immediately vest with PSUs deemed to have met 100% of the specified performance targets.

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:

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;⁽⁴⁾

(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;⁽⁴⁾

(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;⁽⁴⁾ 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 (Ontario), 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 on February 14, 2023; the TSX accepted notice of the amendment in June 2023.

Represents a change to the LTIP which was approved by the Board on May 15, 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 on November 10, 2017; the TSX accepted notice of the amendment on December 28, 2017.

In addition to the amendments noted above, other housekeeping amendments were made to the LTIP in 2023, such as updating the definitions, amending provisions to comply with applicable laws and clarifying that all award payouts are inclusive of any and all vacation pay. None of the amendments approved by the Board on February 14, 2023 and accepted by the TSX in June 2023 required Hydro One Limited shareholder approval.

Compensation Disclosure

NEO Compensation and Alignment with Hydro One Limited Shareholder Value

Supplemental Disclosure

Awards

2021

2022

2023

2024

Named Executive Officer

David Lebeter

President and CEO

(*Provided in COO role)

Chris Lopez

EVP, Chief Financial and Regulatory Officer

(*Prior to increased accountabilities)

Andrew Spencer

EVP, Capital Portfolio Delivery

(*Prior to promotion)

Megan Telford

EVP, Strategy, Energy Transition and Human Resources

(*Prior to increased accountabilities)

Paul Harricks

Former Chief Legal Officer

William Sheffield⁽⁵⁾

Interim 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.

2023 Granted LTIP reflects the fair value on the grant date of the equity-settled PSUs. With the exception of Mr. Sheffield, 2022 and 2021 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 equity-settled PSUs or 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.

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

Summary Compensation Table

Reason for Compensation

Change

David Lebeter

Chris Lopez

Andrew Spencer

Megan Telford

Mr. Lebeter was promoted to the President and CEO role in 2023. The 2022 disclosed compensation reflects his role as Chief Operating Officer. Under the prior executive compensation framework, maximum total direct compensation for the President and CEO was not to exceed $1,604,488 compared to a target of $2,400,000 in 2023.

Name and

Principal

Position

David Lebeter⁽⁷⁾

President and CEO

(2023)

Chris Lopez

EVP, Chief

Financial and Regulatory Officer

Andrew Spencer

EVP, Capital Portfolio Delivery

Megan Telford

EVP, Strategy,Energy Transition and HumanResources

Paul Harricks

Former ChiefLegal Officer

William Sheffield⁽⁸⁾

Interim Presidentand CEO

Base salaries presented are actual amounts earned for fiscal years 2021, 2022 and 2023, as applicable. 2023 base salary for Mr. Sheffield reflects time worked in his interim role in 2023 (January 1, 2023 to February 1, 2023). Ms. Telford's 2022 base salary includes a top- up for her interim role.

For 2023, the dollar amounts represent the fair value of the awards on the grant date determined as a percentage of base salary (subject to rounding). The fair value of the PSUs was determined by multiplying the number of units granted by the closing price of the Hydro One Limited common shares on the date of grant. Other than the grant of DSUs to Mr. Sheffield, no share- or option-based awards were granted in 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 2022 incentive was a special one-time performance bonus for his interim role. Messrs. Lebeter and Spencer elected to take 20% of their 2023 awards in management DSUs.

For 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 2023 disclosed compensation. The value of the cash-settled LTIP (see below in the Outstanding cash-settled LTIP table on page S-39) 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 2021 vested on February 28, 2024 following the end of the performance period on December 31, 2023, and is included in 2023 compensation based on the performance multiplier achieved (100.00% for Messrs. Lebeter, Lopez and Harricks and Ms. Telford, and 147.41% for Mr. Spencer). As a result, the 2022 awards are not included in the table above, as the performance period for these grants will not end until 2024.

The pension value for NEOs participating in the DCPP reflects the employer contributions made to the pension plan and supplemental plan during 2023. These values do not reflect the employee contributions or the investment gains/losses for fiscal year 2023.Mr. Spencer is currently the only NEO participating in the DBPP. The pension value includes a combination of annual current service cost as well as the past service impact of other compensating amounts. The DBPP provides a benefit, in respect of years of service up to 35, which is based on each plan member's highest average earnings at the time of his or her termination or retirement. The value of the increase or decrease in the present value of the defined benefit obligation is affected by differences between actual compensation for the year and the earnings increase assumptions for the year, assumed at the end of the prior year. When the actual earnings increase is not in line with the assumed level, it impacts the total defined benefit obligation in respect of past service. If the expected highest average earnings based on the most recent information is lower than the highest average earnings based on the prior year estimate, it results in a decrease in the defined benefit obligation. Effective December 1, 2016 earnings used for the highest average earnings calculation are capped at $350,000. Beginning on January 1, 2018 and each year thereafter the $350,000 earnings limit is increased by the change in the Consumer Price Index (Ontario).

All NEOs participate in the Management ESOP, except for Mr. Sheffield who was not eligible. Amounts represent the employer contributions to Management ESOP for Mr. Lebeter, Mr. Lopez, Mr. Spencer, Ms. Telford and Mr. Harricks. Amounts also represent for Mr. Lebeter a wellbeing allowance of $50,000 and $103,244 in travel, Mr. Lopez $195,746 in travel, and Mr. Spencer a non-pensionable and non-bonusable award of $58,872 for his interim role as EVP, Digital & Technology. Consistent with the executive compensation framework, none of the NEOs were entitled to perquisites or other personal benefits in 2021 and 2022. Mr. Sheffield's amount represents his board retainer earned from February 1, 2023 to June 2, 2023. Mr. Sheffield elected to receive his board retainer in DSUs, under the non-employee director DSU plan. His pro rata board fees for the second quarter of 2023 were awarded in cash.

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

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

Name

David Lebeter

Chris Lopez

Andrew Spencer

Megan Telford

Paul Harricks

William Sheffield

Reflects the value of outstanding PSUs, including any additional PSUs from dividend reinvestment, with performance assumed at 100%.

Reflects the value of outstanding management DSUs for Ms. Telford and Messrs. Lebeter, Lopez, Spencer and Harricks as at December 31, 2023. Mr. Sheffield's DSUs were granted under the non-employee director DSU plan as part of his compensation for his interim role. He did not hold any DSUs as at December 31, 2023.

Name

David Lebeter

*as COO

Chris Lopez

*Prior to enhanced role

Andrew Spencer

* Prior to promotion

Megan Telford

*Prior to enhanced role

Paul Harricks

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. Spencer's 2021 and 2022 awards are not capped at 100% because he was not an EVP prior to 2023.

Mr. Sheffield was not eligible for LTIP awards.

Name

David Lebeter

Chris Lopez

Andrew Spencer

Megan Telford

Paul Harricks

William Sheffield

Hydro One Limited has not granted option-based awards 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 2023 in respect of the 2022 short-term incentive award payment. For all NEOs, the values above are based on the share price of Hydro One Limited's common shares on the vesting date. 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 and the value of the 2021 cash-settled LTIP where the performance period ended December 31, 2023.

Name

David Lebeter

Chris Lopez

Megan Telford

Paul Harricks

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 2023.

Name

Andrew Spencer

Annual benefits payable at year end were determined using highest three or five years average earnings as applicable and credited service at December 31, 2023. Annual benefits payable at age 65 were determined by using highest three or five years average earnings as applicable at December 31, 2023, and expected credited service at age 65.

The opening present value of the defined benefit obligation is the value of the projected pension earned for service as of December 31, 2022. The values have been determined using the same actuarial assumptions used for determining the pension plan obligations at December 31, 2022 as disclosed in the notes to Hydro One's 2022 consolidated financial statements, based on the actual earnings for 2022 and adjusted to reflect expected increases in pensionable earnings.

Value includes the impact of amounts attributable to interest accruing on the beginning-of-year obligation, changes in the actuarial assumptions, the NEO's own contributions and any other experienced gains and losses.

Equals the value of the projected pension earned for service to December 31, 2023. Represents the defined benefit service cost (the value of the projected pension earned during the year, net of NEO's contributions to the plan) and the impact of any differences between actual increases in 2023 earnings and the actual assumptions used for the year. The values have been determined using the same actuarial assumptions used for determining the pension plan obligations at December 31, 2023 as disclosed in Hydro One's 2023 consolidated financial statements.

Termination and Change in Control Provisions

Compensation

Element

Resignation⁽¹⁾

Retirement⁽²⁾

Termination without
Cause⁽³⁾

Termination without
Cause following
Change in Control⁽⁴⁾⁽⁵⁾

Termination
for Cause

Unvested awards expire on date of termination except if termination occurs after 5 years of

service⁽⁶⁾, in which case a pro rata portion will vest

The NEOs may voluntarily resign their employment at any time; Messrs. Lebeter, Spencer and Ms. Telford are required to give three (3) months' notice. Mr. Lopez provided notice of his intention to resign effective June 30, 2024. Under the terms of Mr. Lopez' retention agreement, he will receive a severance payment as per the termination without cause provisions, accelerated vesting for all outstanding LTIP awards as of his date of resignation (at 100% of target performance) and a prorated short-term incentive award at target.

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 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 not paid or entitled to receive any termination pay, severance pay, 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. Any awards eligible for continued vesting must have been granted at least 6 months prior to the date the NEO provided notice of their intention to retire. 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 STIP, NEOs are considered to have retired if they reach age 55 or such lesser age and service threshold as the Board determines. NEOs will forfeit any awards that have vested but have not been paid out or settled in the event of a breach of any non-competition or non-solicitation obligation. For Mr. Lebeter, the Board has applied its discretion and approved the following: if Mr. Lebeter has completed a minimum of three (3) years continuous service in the role of President and CEO, the Board may in its sole discretion decide to terminate Mr. Lebeter's employment and characterize it for all purposes as a retirement. If Mr. Lebeter accepts this treatment and complies with such transitional activities as may be reasonably required by the Company during the period from the date of notification of such retirement until the date active employment ceases with the Company and its affiliates, Mr. Lebeter will be entitled to have his LTIP awards continue to vest and to also receive the separation package under termination without cause.

The payout multiplier for Mr. Lebeter is 2x and for Mr. Lopez and Ms. Telford is 1.5x. Mr. Spencer is entitled to one month's base salary per completed year of service up to 24 months. Ms. Telford and Mr. Spencer are entitled to 1x bonus.

Treatment only applies to termination by the Company without cause or in the case of Messrs. Lebeter and Spencer and Ms. Telford in the case of resignation, for good reason within 24 months following a change in control and only applies to unvested awards. For Mr. Lopez, unvested LTIP awards at the time of change of control will continue to vest if rolled over into corresponding LTIP awards with the surviving entity with the Board retaining discretion to accelerate vesting. For Messrs. Lebeter and Spencer and Ms. Telford "good reason" is defined as a material change in title, responsibilities, reporting line or relationship or "status"; a reduction in base pay or in STIP or LTIP target opportunity that would result in a material reduction in aggregate annual compensation or opportunity for compensation, being required to change principal place of employment more than 50 kilometers away from the existing Toronto based principal place of employment, constructive dismissal, as well as in the change in control circumstances as defined below. These NEOs must provide the Company with written notice confirming the circumstances they believe to constitute good reason within 21 days of the occurrence and a cure period of 60 days following the date the Company has received such notice has elapsed without such circumstances having been cured. Any unvested LTIP awards will immediately vest on the date employment is terminated without cause or resignation for good reason within twenty-four (24) months of a change in control.

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 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, subject to, for the cash-settled LTIP, the participant having five (5) years of service.

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. Any wellbeing allowances end upon termination of employment for any reason.

Benefits will continue for up to 24 months for Mr. Lebeter, for 18 months for Mr. Lopez and as per Employment Standards Act minimum requirements for Ms. Telford and Mr. Spencer.

Name

David Lebeter

Chris Lopez

Andrew Spencer

Megan Telford

Paul Harricks⁽³⁾

William Sheffield⁽⁴⁾

Hydro One does not ascribe a value for benefits continuation.

Severance payments are calculated based on annualized base salary and the lower of the average annual bonus for the prior 3 years and the target short-term incentive as of December 31, 2023 . The severance calculation multiplier for the NEOs is 1.5x to 2x for base salary and 1x to 2x for STIP. For participants in the LTIP, a pro rata portion of the participant's LTIP has been included above, assuming performance at 100% For participants with at least five (5) years of service a pro rata portion of the participant's outstanding cash-settled LTIP has been included above, assuming performance at 100%. The Company does not ascribe a value for benefits continuation.

Mr. Harricks retired on December 31, 2023. The value represents his unvested LTIP which will continue to vest to the normal vesting dates and be subject to actual performance, valued as of December 29, 2023, assuming a payout of 100% for 2022 and 2023 awards and actual performance of 100% for the 2021 award.

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

DIRECTOR COMPENSATION

2023 Compensation by Role⁽¹⁾

Board chair

Committee chair⁽²⁾

Other directors

As per the Director Compensation, Travel and Expense policy, each director is required to receive at least 50% of their annual retainer as an equity component. The figures in the table above illustrate the amounts paid if a director has opted for a 50/50 split between cash and equity.

As at December 31, 2023, committee chairs received a $5,346 annual retainer for their duties as committee chair.

2024 Compensation by Role⁽¹⁾

Board chair

Committee chair⁽²⁾

Other directors

Effective February 13, 2024. the Board, upon recommendation of the GRC, approved an increase of the minimum equity component of the annual retainer for each director, Board committee chair and the Board chair from 50% to 60%. The Board retained the option for each director, committee chair and the Board chair to receive up to 100% of their annual retainers in the form of DSUs. The figures in the table above illustrate the amounts paid if a director has opted to receive 60% in equity and 40% in cash.

As of February 13, 2024, Board committee chairs receive a $15,000 annual retainer for their duties as committee chair.

Chair

Other Directors

Name

Share
Ownership

Cherie Brant

David Hay

Name

Share
Ownership

Timothy Hodgson

Stacey Mowbray

Mitch Panciuk

Mark Podlasly

Helga Reidel

Melissa Sonberg

Brian Vaasjo

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. Hodgson has until August 14,2024 to meet his SOR. It is anticipated that he will satisfy the requirement prior to such date.

Total Compensation Paid to Directors in 2023

Total Compensation

Name

Cherie Brant

Blair Cowper- Smith ⁽³⁾

David Hay*

Timothy Hodgson

Stacey Mowbray*

Mitch Panciuk⁽⁴⁾

Mark Podlasly⁽⁶⁾

Helga Reidel⁽⁴⁾

Total Compensation

Name

Russel Robertson⁽³⁾

Melissa Sonberg*

Brian Vaasjo⁽⁵⁾

Susan Wolburgh Jenah *⁽⁶⁾

Denotes committee chair.

All amounts in this table are pre-tax. Amounts reported include the portion of the director's board retainer, and committee chair retainer.

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.

Mr. Cowper-Smith and Mr. Robertson were compensated for their service until they ceased serving as directors on June 2, 2023.

Mr. Panciuk and Ms. Reidel were elected to the Board on June 2, 2023, and received compensation following their election.

Prior to being elected as a director, Mr. Vaasjo attended board meetings as an observer. Mr. Vaasjo received an honorarium of $28,355 for his service in 2023 prior to his election, this cash payment is included within the 'board retainer' and 'total fees' columns above.

Mr. Podlasly and Ms. Wolburgh Jenah made changes to their DSU election during 2023, the DSU component for Mr. Podlasly and Ms. Wolburgh Jenah included in the above chart indicates their average DSU holding over the course of 2023.