TORONTO - Ontario Power Generation Inc. announced yesterday the financial close of a $200 million private placement issue to fund the re-development of four hydroelectric generating stations that have reached the end of their service lives.

UMH Energy Partnership (UMH) reached financial close of a $200 million private placement issue of senior secured bonds, due 2041. UMH is a general partnership between OPG (99.9%) and UMH Energy Inc. (0.1%), a wholly owned subsidiary of OPG. The bonds received an 'A2' rating by Moody's Investor Services and an 'A' rating by Standard & Poor's Rating Services. The financing was arranged by Scotia Capital Inc. and TD Securities Inc.

The $200 million private placement completes the financing required for this project, together with $100 million provided by OPG through its partnership interest.

The financing will fund the re-development of four hydroelectric generating stations that have reached the end of their service lives. Three of the generating stations are on the Upper Mattagami River (Wawaitin, Sandy Falls and Lower Sturgeon) and the fourth (Hound Chute) is located on the Montreal River. Construction of these facilities is scheduled to be complete by December 2010, resulting in a 21 megawatt ("MW") increase in generation capacity to 44 MW.

The re-development project is supported by a Hydroelectric Energy Supply Agreement with the Ontario Power Authority.

UMH Energy Partnership was formed for the purpose of acquiring, owning, redeveloping, operating, and maintaining certain run-of the river hydroelectric facilities owned by OPG located on the Upper Mattagami River and on the Montreal River.