Canadian Hydro Announces Results for the Second Quarter Ended June 30, 2009

CALGARY, ALBERTA--(Marketwire - Aug. 14, 2009) - Canadian Hydro Developers, Inc. (TSX:KHD)

HIGHLIGHTS

- EBITDA and cash flow per share increased 50% over the prior year;

- Achieved commercial operations at Canada's second largest wind facility, the 197.8 MW Wolfe Island EcoPower(R) Centre, on June 26, 2009;

- Increased generation, revenue, EBITDA and cash flow due to the addition of Wolfe Island and the 132 MW Melancthon II EcoPower(R) Centre (Melancthon II). Together, Wolfe Island and Melancthon II more than double the size of our Company;

- Achieved positive operating income at our Grande Prairie EcoPower(R) Centre (GPEC), an improvement for the six months ended June 30, 2009, exceeding the amount from the entire 2008 calendar year;

- Resumed construction of our 18 MW Bone Creek Hydroelectric Project; and

- Announced the promotion of Kent Brown to Chief Executive Officer and Kathy Boutin to Chief Financial Officer, effective July 1, 2009.

/T/

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Q2 6 Months
Change Change
2009 2008 % 2009 2008 %
----------------------------------------------------------------------------
Financial Results (in
thousands of dollars
except where noted)
Revenue 26,157 19,661 + 33 49,619 39,122 + 27
EBITDA(1) 17,148 11,279 + 52 30,164 23,978 + 26
Cash flow (1) 9,172 5,614 + 63 14,562 13,956 + 4
Per share (diluted) 0.06 0.04 + 50 0.10 0.10 -
Net earnings (loss) 23 2,883 - 99 (2,195) 4,692 - 147
Per share (diluted) 0.00 0.02 - 100 (0.02) 0.03 - 167

Operating Results
Installed capacity
- MW (net) 694 364 + 91 694 364 + 91
Electricity generation
- MWh (net) 354,617 261,377 + 36 642,067 517,844 + 24
kWh per share (diluted) 2.47 1.80 + 37 4.47 3.57 + 25
Average price received
per MWh ($) 74 75 - 1 77 76 + 1
Electrical generation
under contract (%) 86 78 + 10 83 76 + 9

(1) Non-GAAP measures, please refer to 'Advisories' included in the MD&A

/T/

For the second quarter ended June 30, 2009, revenue, EBITDA, and cash flow improved over the same period due to:

- The addition of Melancthon II (November 2008) and Wolfe Island (June 2009);

- Improved generation at Melancthon I as a result of substation work completed in 2008, which reduced availability by 28 days in June 2008; and

- Improved generation at GPEC.

These factors were offset partially by:

- Increased interest expense as compared to the prior year as a result of the interest from the Melancthon II construction facility now being expensed;

- Lower pool prices received in Alberta;

- Increased administrative expenses as a result of the Company's growth; and

- Lower foreign exchange gains as a result of lower foreign cash balances on hand.

For the six months ended June 30, 2009, revenue, EBITDA and cash flow improved over the same period in the prior year as a result of the factors described above.

On July 22, 2009, TransAlta Corporation launched an unsolicited offer (the TransAlta offer) to purchase all of the outstanding common shares of Canadian Hydro. The Board of Directors of Canadian Hydro have performed a thorough review and evaluation of the unsolicited TransAlta offer with its independent financial and legal advisors and have, as of the date hereof, concluded that the TransAlta offer is inadequate and not in the best interests of Canadian Hydro and its shareholders. As a result, the Board of Directors unanimously recommended that Canadian Hydro shareholders REJECT THE TRANSALTA OFFER by not tendering their shares. Please refer to our website at www.canhydro.com for current information regarding the unsolicited TransAlta offer.

"As the TransAlta process unfolds, the Canadian Hydro team remains focused on advancing our suite of growth opportunities," said Kent Brown, Chief Executive Officer of Canadian Hydro. "We are at a key inflection point in our Company's 20-year history as we begin to reap the financial rewards of our significant development investments, as seen in our Q2 results. With the completion of Melancthon II and Wolfe Island, we have more than doubled the size of Canadian Hydro in the last eight months and will show quarter over quarter growth throughout the worldwide economic downturn. We are now less reliant on external financing sources and will be able to take on larger projects. Additionally, after much consideration and planning, a key executive transition has been completed with John and Ross Keating transitioning into new roles of Founder and Director, and myself and Kathy Boutin being promoted to Chief Executive Officer and Chief Financial Officer, respectively. The Keatings are pioneers of green energy in Canada, and will remain a valuable source of knowledge and guidance for the Company going forward. While we are now a bigger company, we remain committed to our entrepreneurial roots and to Building a Sustainable Future(R), and will continue to realize a strategic advantage through our unique process of design, build, and operate."

Canadian Hydro is focused on Building a Sustainable Future(R). We are a developer, owner and operator of 21 EcoPower(R) Centres totalling net 694 MW of capacity in operation and have an additional 160 MW in or nearing construction and 1,660 MW of prospects under development. Our renewable generation portfolio is diversified across three technologies (water, wind and biomass) in the provinces of British Columbia, Alberta, Ontario, and Quebec. This portfolio is unique in Canada as all facilities are certified, or slated for certification, under Environment Canada's EcoLogo(M) Program.

Common shares outstanding: 143,801,223

MANAGEMENT'S DISCUSSION AND ANALYSIS (MD&A)

Advisories

The following MD&A, dated August 6, 2009, should be read in conjunction with the audited consolidated financial statements as at and for the years ended December 31, 2008 and 2007 (the Financials) and the unaudited interim consolidated financial statements for the three and six months ended June 30, 2009 and 2008. All tabular amounts in the following MD&A are in thousands of dollars, unless otherwise noted, except share and per share amounts. Additional information respecting our Company, including our Annual Information Form, is available on SEDAR at www.sedar.com. Additional advisories with respect to forward looking statements and the use of non-GAAP measures are set out at the end of this MD&A under 'Additional Disclosures'.

EXECUTIVE SUMMARY

We completed significant milestones in the execution of our strategic plan during the first six months of 2009. We:

- Achieved commercial operations at our Wolfe Island EcoPower(R) Centre (Wolfe Island) on June 26, 2009, on-time at a cost of $478 million, which increased our net installed capacity by 40% to 694 MW;

- Promoted Kent Brown to Chief Executive Officer and Kathy Boutin to Chief Financial Officer, and John and Ross Keating transitioned to Founder & Director roles;

- Progressed well on the planned programs under way at our Grande Prairie EcoPower(R) Centre (GPEC) and Centre EcoPower(R) Le Nordais (Le Nordais) with the goal of improving operations by the end of 2009;

- Made advances on permitting the 100 MW Dunvegan Hydroelectric Prospect (Dunvegan); and

- Resumed construction on our 18 MW Bone Creek Hydroelectric Project (Bone Creek).

Compared to Q2 2008, revenue, EBITDA and cash flow increased in Q2 2009 due to:

- The addition of phase II of the Melancthon EcoPower(R) Centre (Melancthon) completed in November 2008 and Wolfe Island; and

- Increased generation at Le Nordais as a result of windier conditions.

Net earnings were lower in Q2 2009 compared to Q2 2008 due to:

- Increased interest expense as a result of the Melancthon II construction facility being charged to earnings rather than project costs as the project was completed in November 2008;

- Increased amortization expense due to commercial operations achieved at Melancthon II and Wolfe Island; and

- Lower foreign exchange gains compared to the prior year as a result of lower foreign cash balances on hand.

Revenue, EBITDA and cash flow improved in the first six months of 2009 over the same period in the prior year due to:

- The addition of phase II of Melancthon in November 2008 and Wolfe Island; and

- Improved generation and operating results at GPEC as a result of the work program initiated in late 2008.

For the six months ended June 30, 2009, net earnings were lower compared to 2008 due to the same factors as discussed above for Q2 2009 as well as lower generation at Melancthon I and II in Q1 2009 as a result of lower than average wind conditions.

/T/

RESULTS OF OPERATIONS

Revenue and Generation

Quarterly Electricity Generation - by Province and Technology(1)

----------------------------------------------------------------------------
Q2 6 months
2009 2008 2009 2008
MWh MWh Change MWh MWh Change
----------------------------------------------------------------------------
British Columbia 81,569 80,607 + 1% 86,881 111,936 - 22%
Alberta 105,224 107,144 - 2% 218,165 225,921 - 3%
Ontario 151,145 59,566 + 154% 299,311 138,990 + 115%
Quebec 16,679 14,060 + 19% 37,710 40,997 - 8%
----------------------------------------------------------------------------
Totals 354,617 261,377 + 36% 642,067 517,844 + 24%
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Hydroelectric 124,935 120,362 + 4% 157,780 174,808 - 10%
Wind 195,522 108,620 + 80% 418,534 281,511 + 49%
Biomass 34,160 32,395 + 5% 65,753 61,525 + 7%
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Totals 354,617 261,377 + 36% 642,067 517,844 + 24%
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kWh per share(2) 2.47 1.80 + 37% 4.47 3.57 + 25%
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(1) Reflecting our net interest.
(2) kWh per share based on diluted weighted average shares outstanding.

/T/

Revenue in Q2 2009 increased 33% over Q2 2008 as a result of the following factors:

- The addition of Melancthon II in November 2008 and Wolfe Island in June 2009;

- Improved generation in June compared to the prior year at Melancthon I as the EcoPower(R) Centre was shutdown for 28 days in June 2008 to allow for a substation expansion; and

- Improved generation at GPEC as a result of the work programs currently underway.

These increases were offset partially by lower generation at our Alberta wind EcoPower(R) Centres due to lower wind levels than Q2 2008.

For the six months ended June 30, 2009, revenue increased 27% over 2008 as a result of the following factors:

- The addition of Melancthon II in November 2008 and Wolfe Island in June 2009;

- Improved hydroelectric generation in Alberta and Ontario due to higher water levels; and

- Improved generation at GPEC as a result of the work program currently underway;

Offset slightly by:

- Lower generation at our British Columbia hydroelectric EcoPower(R) Centres due to lower water levels and increased downtime for planned maintenance;

- The inclusion in Q1 2008 of a one-time metering adjustment at our Akolkolex Hydroelectric EcoPower(R) Centre (Akolkolex) of 21,011 MWh, which benefited generation in Q1 2008; and

- Lower generation at our Alberta and Ontario wind EcoPower(R) Centres due to lower wind levels than the same period in 2008.

We received an average price of $74/MWh for Q2 2009 and $77/MWh year to date, compared to $75/MWh in Q2 2008 and $76/MWh for the first six months of 2008. These changes are the result of:

- The addition of Melancthon II and Wolfe Island, which have higher contract prices than the average of our other EcoPower(R) Centres;

Offset by:

- Lower pool prices received by our merchant Alberta plants in Q2 2009 (Q2 2009 - $30/MWh; Q2 2008 - $93/MWh) and for the six months ended June 30 (2009 - $42/MWh; 2008 - $76/MWh) due to lower natural gas prices and lower demand as a result of the current worldwide economic downturn, both of which influence the spot market price in Alberta. On an annual basis, a $10/MWh change in the Alberta pool price impacts earnings and cash flow per share by $0.01.

This decline in pool price was mitigated by the fact that approximately 86% of our total generation was sold pursuant to long-term sales contracts in Q2 2009 (Q2 2008 - 78%) and for the six months ended June 30, 2009, 83% of generation was sold under long-term sales contracts (2008 - 76%).

Operating Expenses

Operating expenses decreased 13% in Q2 2009 compared to Q2 2008, mainly due to the following factors:

- Significantly lower operating expenses at GPEC in Q2 2009 than Q2 2008;

- Lower property taxes in Alberta and British Columbia due to reductions in assessed values and mill rates; and

- Lower land lease payments in Alberta due to lower wind generation and significantly lower pool prices.

These decreases were offset partially by the addition of Melancthon II and Wolfe Island.

On a $/MWh basis, operating expenses decreased 35% in Q2 2009 compared to Q2 2008, primarily as a result of increased generation due to the addition of Melancthon II and Wolfe Island, as well as the above factors.

For the six months ended June 30, 2009, operating expenses increased 7% over 2008 as a result of the addition of Melancthon II and Wolfe Island and planned maintenance completed in Q1 2009 at our British Columbia Hydroelectric and Le Nordais EcoPower(R) Centres, offset partially by the factors discussed above. On a $/MWh basis, operating expenses decreased 14% for the six months ended June 30, 2009, compared to 2008, primarily as a result of increased generation due to the addition of Melancthon II and Wolfe Island.

Gross Margins

Gross margins, as a percentage of revenue, increased to 75% in Q2 2009 compared to 62% in Q2 2008 due primarily to increased generation and decreased operating expenses, as explained above.

For the six months ended June 30, 2009, gross margins were 73% compared to 68% in 2008 due to the increase in generation discussed above.

/T/

Interest on Credit Facilities

----------------------------------------------------------------------------
Q2 6 months
(in thousands of dollars
except where noted) 2009 2008 Change 2009 2008 Change
----------------------------------------------------------------------------
Gross interest on credit
facilities 8,728 8,864 - 2% 17,958 14,543 + 23%
Capitalized interest (1,382) (4,122) - 66% (3,554) (5,377) - 34%
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Net interest expense on
credit facilities 7,346 4,742 + 55% 14,404 9,166 + 57%
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Net interest expense on
credit facilities per MWh
($/MWh) 20.72 18.15 + 14% 22.43 17.70 + 27%
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/T/

The increase in net interest expense on credit facilities for Q2 2009 and for the six months ended June 30, 2009 compared to the prior year was due to higher outstanding corporate debt, which increased as a result of the achievement of commercial operations (COD) of Melancthon II and Wolfe Island. Prior to COD, interest was capitalized to the projects.

On a $/MWh basis, net interest expense increased in 2009 as a result of increased debt and lower than average generation at Melancthon in January and February. On an annual basis, we expect this amount to decrease as we receive the generation benefits from Melancthon II and Wolfe Island.

We have a capital intensive business with a multi-year growth horizon. Interest costs incurred as a result of our capital program are capitalized to the project during the construction phase and are part of the estimated capital costs for the project. Capitalized interest associated with construction-in-progress and development prospects decreased due to lower outstanding balances on our credit facilities associated with the projects in or nearing construction, compared to the prior year.

Credit facilities (including current portion) drawn as at June 30, 2009 were $876,165,000 compared to $835,796,000 as at December 31, 2008. The increase was a result of increased draws on our construction facilities, less the usual repayments on certain credit facilities.

Amortization Expense

Amortization expense increased 58% in Q2 2009 from Q2 2008 and 55% for the six months ended June 30, 2009 compared to 2008, due to the addition of Melancthon II and Wolfe Island. On a $/MWh basis, amortization expense increased due to these additions, which have a higher capital cost than our existing plants.

Our wind EcoPower(R) Centres are amortized on a straight-line basis over a 30 year period, except Le Nordais and Taylor, which are amortized over 26 years and 15 years, respectively, and our biomass and hydroelectric EcoPower(R) Centres are amortized on a straight-line basis over a 40 year period.

/T/

Administration Expense

----------------------------------------------------------------------------
Q2 6 months
(in thousands of dollars
except where noted) 2009 2008 Change 2009 2008 Change
----------------------------------------------------------------------------
Gross administration
expenses 3,915 3,152 + 24% 8,157 5,376 + 52%
Capitalized
administration expenses (1,338) (1,917) - 30% (2,573) (2,328) + 11%
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Net administration
expenses 2,577 1,235 + 109% 5,584 3,048 + 83%
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Net administration
expenses per MWh ($/MWh) 7.27 4.67 + 56% 8.70 5.88 + 48%
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/T/

Gross administration expense increased 24% in Q2 2009 compared to Q2 2008 and 52% for the six months ended June 30, 2009, compared to 2008. Over the past year, we have become a much larger company and have more than doubled our generating capacity within the last eight months. As a result, administration expenses and staff numbers have increased in order to support that growth.

On a $/MWh basis, net administration expense increased for the three and six month periods in 2009 compared to the prior year due to the reasons explained above.

Stock Compensation Expense

Stock compensation expense increased 78% in Q2 2009 compared to Q2 2008 and 31% for the six months ended June 30, 2009, compared to 2008 due to the issuance of 4,017,200 options in Q2 2009 in accordance with our new comprehensive compensation program. As a result of the new compensation program, effective April 2009, going forward we anticipate issuing between 900,000 and 1,200,000 options per year, with option grants occurring in the second and fourth quarters.

Income and Capital Taxes

We do not anticipate paying cash income taxes for several years, other than in respect of the Cowley Ridge EcoPower(R) Centre, through our wholly owned subsidiary, Cowley Ridge Wind Power Inc. This subsidiary is fully taxable, but is entitled to recover approximately 175% of cash taxes paid annually (limited to 15% of eligible gross revenue).

We are also liable for Provincial Capital Taxes in Ontario and Quebec, which comprise the majority of the current tax provision. Ontario Capital Tax is scheduled to be eliminated effective July 1, 2010, while Quebec Capital Tax is scheduled to be eliminated effective January 1, 2011.

Future income taxes decreased 111% and 138% for the three and six months ended June 30, 2009, compared to the same periods in the prior year, due to lower earnings before taxes and adjustments to tax pools upon finalization of 2008 annual tax returns. Our effective tax rate of 19% remains unchanged in 2009. As at June 30, 2009, we had available tax pools of $1,285,308,000.

EBITDA, Cash Flow, and Net Earnings (Loss)

EBITDA

EBITDA increased 52% in Q2 2009 compared to Q2 2008 and 26% for the six month period ended June 30, 2009, compared to 2008 due to:

- Increased generation as discussed above; and

- Increased gross margins, as discussed above.

This was offset partially by higher administrative expenses, as previously discussed.

On a $/MWh basis, EBITDA increased as a result of the factors discussed above with respect to gross margins.

Cash Flow

Cash flow increased 63% in Q2 2009 compared to Q2 2008, and 4% for the six month period ended June 30, 2009, compared to 2008 due to:

- Higher EBITDA as discussed above;

Offset partially by:

- Higher interest expense as a result of interest from the Melancthon II construction facility no longer being charged to the project costs; and

- Higher administrative expenses and capital taxes as compared to the prior year.

On a per share basis, cash flow increased 50% in Q2 2009 compared to Q2 2008 due to the reasons above. For the six months ended June 30, 2009, cash flow per share was consistent with 2008. Additionally, the proceeds from our equity issuances in 2005 have been used primarily to finance the equity portion of capital costs related to the construction of Melancthon II, Wolfe Island and our British Columbia Hydroelectric Projects. The benefits of these equity issues will not be fully reflected in our cash flow until a full year of operations has been achieved at these projects.

Net Earnings (Loss)

Net earnings (loss) decreased 99% in Q2 2009 compared to Q2 2008 and 147% for the six months ended June 30, 2009, compared to 2008, mainly as a result of:

- Higher amortization and interest expense as a result of the completion of Melancthon II and Wolfe Island;

- A large foreign exchange gain in Q2 2008 relating to Euros ear-marked for turbine purchases. With the completion of Wolfe Island, we had lower foreign cash balances on hand; and

- Higher stock compensation expense as a result of more options issued in 2009.

These expenses were offset partially by increased gross margins.

On a $/MWh basis, net earnings for both Q2 2009 and the six months ended June 30, 2009, decreased over the prior year.

The proceeds from our equity issuances in 2005 were used to finance the construction of Melancthon II, Wolfe Island, and our British Columbia Hydroelectric Projects. The benefits of these equity issues will not be fully reflected in our net earnings until a full year of operations has been achieved at these projects.

/T/

Property, Plant, and Equipment Additions and Prospect Development Costs

----------------------------------------------------------------------------
Q2 6 months
----------------------------------------------------------------------------
(in thousands of dollars) 2009 2008 Change 2009 2008 Change
----------------------------------------------------------------------------
Property, plant, and
equipment additions 13,982 130,222 - 89% 76,363 140,863 - 46%
Prospect development cost
additions 2,719 5,387 - 50% 6,437 7,750 - 17%
----------------------------------------------------------------------------

/T/

Property, plant, and equipment additions relate mainly to capital expenditures for Wolfe Island.

Additions to prospect development costs relate primarily to expenditures for Dunvegan, Bone Creek, and the Quebec wind projects.

LIQUIDITY AND CAPITAL RESOURCES

The nature of our business requires long lead times from prospect identification through to commissioning of electrical generation facilities. Our investment commitment proceeds in a step-wise fashion through the identification and preparation of our prospects, to securing the associated power purchase contracts, to satisfying the lengthy regulatory requirements, and finally to constructing the facilities.

Given these long lead times from expenditure through to cash flow generation, it is imperative to have a solid and well funded capital structure. We operate with a minimum equity base of 35% on invested capital and fund the majority of our debt on a basis consistent with the long term asset base - mid-term financing is obtained through the construction phases and then converted into a long-term unsecured debenture basis after commissioning, consistent with the power purchase agreements we enter into.

Our capital expenditure plans and our current expectations as to the funding thereof are summarized in the table below. We believe we will generate the necessary cash flow and working capital to meet the equity needs of new projects. Subject to conditions in the capital markets at the time, we expect to have adequate access to financing to fulfill all the obligations that may be required to implement this expansion plan.

In June 2008, we issued unsecured debentures for total gross proceeds of $75,900,000, and amended our existing credit agreement, adding an additional $312,500,000 of unsecured credit facilities, for a total of $611,000,000 (see 'Interest on Credit Facilities').

/T/

----------------------------------------------------------------------------
As at June 30
(in thousands of dollars) 2009
----------------------------------------------------------------------------
Capital expenditure plans through 2012 474,100
Spent to date (28,739)
----------------------------------------------------------------------------
Remaining capital expenditures to be financed 445,361
Financed/to be financed by:
Blue River Credit Facility 31,590
Working capital(1) (22,855)
Anticipated credit facilities(2) 281,900
Undrawn & available revolving Operating Facility 46,003
Expected to be funded through cash flow from operations 108,723
----------------------------------------------------------------------------
Difference -
----------------------------------------------------------------------------
(1) Excluding derivative financial instruments assets and liabilities
(2) See following table with project breakdown

Our current capital expenditure plans are for the following projects either
in or nearing construction:

- Yellow Falls;
- Royal Road;
- Bone Creek;
- St. Valentin; and
- New Richmond.

The following table outlines the size and timing of the anticipated credit
facilities:

----------------------------------------------------------------------------
Anticipated construction Anticipated timing of
(in thousands of dollars) facility size construction facility
----------------------------------------------------------------------------
Project
Yellow Falls 28,400 Q3 2009
Royal Road 26,000 Q1 2010
New Richmond 123,500 Q4 2011
St. Valentin 104,000 Q4 2011
----------------------------------------------------------------------------
Total 281,900
----------------------------------------------------------------------------

/T/

Exclusive of any new projects that we may be awarded under the calls for power discussed below, we will require no additional equity financing for our current projects out to 2012, and anticipate requiring only $28 million of debt financing in Q3 2009, relating to the Yellow Falls Hydroelectric Project. With Wolfe Island now completed, we expect to have the ability to finance the equity portion of approximately one, 100 MW project each year from free cash flow.

The construction facilities we have placed and anticipate placing for these projects are, generally, based on 65% of the capital costs of these projects. Our ability to debt finance these projects is predicated on our BBB (Stable) investment grade credit rating. Generally, we cannot draw on construction credit facilities until we have expended 35% of the capital costs of a project, using our equity to pay for this. If timing differences exist between when the costs are expended and the construction facilities are in place, we employ our cash flow from operations to support our capital expenditure program.

Our revolving Operating Facility matures on August 28, 2009, followed by a six-month non-amortizing term out period, subject to a one year extension upon mutual agreement by ourselves and the lending syndicate. On July 29, 2009, we requested an offer of extension of the Operating Facility term out date for a further period of 364 days from August 29, 2009 to August 28, 2010. While we are confident that the Operating Facility will be renewed prior to its maturity, the Operating Facility is classified within the current portion of our long-term debt until the Operating Facility is extended.

We have no other requirements to access the debt markets until September 2010 when the Melancthon II Construction Facility matures. Based on preliminary discussions with potential lenders and feedback we have received, we believe that we will be able to access the debt markets, as required, to satisfy our maturing obligations.

As at June 30, 2009, we had a 64/36 debt/capital mixture (December 31, 2008 - 63/37) consistent with our stated target of 65/35. We monitor our lending covenants on a continuous basis and, based on our projections, will continue to comply with all externally imposed covenants.

OUTLOOK

Project Updates

Ontario

Wolfe Island

At Wolfe Island, COD was achieved on June 26, 2009 at a total cost of $478 million. The completion of Wolfe Island represents a major milestone in the execution of our strategic plan and has increased our installed capacity by 40% to 694 MW. With the completion of Melancthon II and Wolfe Island, we have successfully doubled the size of our Company within eight months, which is a testament to our team's ability to finance, complete projects and execute on our strategic plan.

Royal Road Wind Projects

We continue to work through the approvals process for the $40 million Royal Road Wind Projects in Ontario. The projects are targeted for completion in August 2010. However, we expect the Ontario Power Authority (OPA) to offer an optional form of contract amendment to provide a one-year extension to the target in-service date. Regulatory approvals and debt financing are required prior to proceeding with construction.

Yellow Falls Hydroelectric Project

We continue to work on obtaining permits and approvals to proceed to construction of our 16.0 MW (8.0 MW net to our interest), $71,000,000 ($35,500,000 net to our interest) Yellow Falls Hydroelectric Project. Yellow Falls has a 20-year RES II Contract with the OPA for the purchase of electricity and Renewable Energy Certificates (RECs). Our target completion date for this project is October 2010. Regulatory approvals and financing are required prior to proceeding with construction.

British Columbia

Bone, Clemina, Serpentine and English Creek Hydroelectric Projects

Since securing Electricity Purchase Agreements (EPAs) in 2006 with BC Hydro, construction costs have increased significantly. As a result, the project returns for Clemina