1 of 27

Infrastructure Development & Funding: Unlocking Opportunities for Water Systems

2 of 27

2

Creating Opportunities in Ontario

WOMC

October 2025

COMMERCIALLY SENSITIVE

3 of 27

EPCOR in Ontario

3

Ontario Head Office

Industrial Water

Electricity

Natural Gas

EPCOR Operations

South Bruce Natural Gas

Southern Bruce natural gas distribution system for Kincardine, Arran- Elderslie and Huron - Kinloss (4,500+ connections)

2019

Acquired NRG Natural Gas

Natural gas distribution system serving located in Aylmer serving +10,000 connections – in Elgin, Middlesex, Oxford and Norfolk Counties

2017

Ontario Head Office

Located at 55 University Avenue

Toronto ON

2019

Darlington Demineralized �Water Treatment

Design-Build-Finance-Operate the Darlington Demineralized Water Treatment Facility for OPG

2021

Electricity local distribution company serving more than 20,000 residential, commercial and industrial customers in Collingwood, Stayner, Creemore and Thornbury

2018

Acquired Collus-Powerstream LDC

COMMERCIALLY SENSITIVE

4 of 27

Defining the Problem

4

Water and wastewater investments carry large risks

This type of infrastructure is very expensive for municipalities
Uncertain population and economic growth often hinders investment
Project risks include design, construction, finance, operations, environmental, regulatory and revenue
Political risk exists with the optics of private involvement with municipal water

An alternative delivery approach can help municipalities better manage these risks

COMMERCIALLY SENSITIVE

5 of 27

Risk Transfer in Alternative Delivery

5

COMMERCIALLY SENSITIVE

6 of 27

Risk Sharing Example: DBFOM

Risk Transfer: �Through a Single Point of Responsibility all obligations related to the project are met under one project-related proponent or company. The focus is on outcomes delegating the responsibility and risk, related to design, build, operation, or finance, to one entity so that interfaces and integration aspects of the project are not at risk to fall through the gaps due to inter-party communication issues.

Efficiency: �The private sector, due to its commercial mind-set, involvement, flexibility with employee management, and focus on cost effectiveness, can provide a greater level of efficiency in project delivery.

Technology and Know-how: �The public sector often looks to the private sector to provide technology and know-how both in asset development and service delivery. Expertise is not limited to technology but also includes approaches to management and methods of operation and maintenance.

Financing: �Private sector financing, when risk adjusted, is less expensive in most cases.

Cost of Procurement: �The direct cost and efficiency comparison of public versus private finance is difficult to quantify. Based on EPCOR's project experience, there is evidence that 20-40% savings can be realized with private participation through the synergy of a design-build-operate process, risk transfer and cost certainties.

6

COMMERCIALLY SENSITIVE

Risk Transfer: �Through a Single Point of Responsibility all obligations related to the project are met under one project-related proponent or company. The focus is on outcomes delegating the responsibility and risk, related to design, build, operation, or finance, to one entity so that interfaces and integration aspects of the project are not at risk to fall through the gaps due to inter-party communication issues.

Efficiency: �The private sector, due to its commercial mind-set, involvement, flexibility with employee management, and focus on cost effectiveness, can provide a greater level of efficiency in project delivery.

Technology and Know-how: �The public sector often looks to the private sector to provide technology and know-how both in asset development and service delivery. Expertise is not limited to technology but also includes approaches to management and methods of operation and maintenance.

Financing: �Private sector financing, when risk adjusted, is less expensive in most cases.

Cost of Procurement: �The direct cost and efficiency comparison of public versus private finance is difficult to quantify. Based on EPCOR's project experience, there is evidence that 20-40% savings can be realized with private participation through the synergy of a design-build-operate process, risk transfer and cost certainties.

7 of 27

Risk Sharing Example: DBFOM

7

EPCOR

Design Management
Technology Selection
Design Errors and Omissions
Constructability Design
Construction Health, Safety, and Environment
Construction Management
Subcontractor Tendering and Management
Construction / Building Permits
Material Procurement
Equipment Warrantees
Construction Schedule
Construction Costs
Construction Resource Availability
Commissioning and Performance Testing
Construction Insurance
Financing Interest Rates

Shared

Overall project delivery
Stakeholder and Indigenous Consultant

Municipality

Project Scope Changes
Political and Stakeholder Management
Rate Setting / Revenue Generation
Ongoing Operations and Maintenance
Force Majeure
Changes in Law
Ownership of Assets
Influent / Effluent Quality
Governmental / Environmental Approvals
Land Acquisition

COMMERCIALLY SENSITIVE

8 of 27

EPCOR’s ability to manage shared risk

8

Over 130 years of experience in allocating technical and commercial risk, navigating unique regulatory and compliance processes
Life-cycle focus from initiation of a project with focus on minimizing total cost of ownership
Capable of providing fixed O&M costs providing cost certainty
O&M risks assumed by EPCOR include but are not limited to:

Asset replacement value and durations
O&M resourcing including labour relations
Supplier/contractor management
Consumable (i.e. chemicals, membranes, etc.) sourcing and pricing

Ability to transition union employees to EPCOR
Capacity building of local personnel, including attaining certifications

COMMERCIALLY SENSITIVE

9 of 27

Case Study 1 | Regina Wastewater Treatment Plant

9

Client	City of Regina
Year	2017 (Final Completion)
Delivery Method	P3 DBFOM
Project Value	Initial Contract Price (Construction only): $158.5M Total NPV (Construction, O&M, Renewal, Financing, Utilities): $611M
Treatment Capacity	156MLD
Roles of Team Members	EPCOR - Project Lead, Financier & Operator Aecon - Construction Lead JV Stantec - Design Lead
Key Treatment Technologies	Vortex grit removal, repurposed primary clarification, new BNR bioreactors, new secondary clarifiers, upgraded fermenter, upgraded mesophilic digestion and a new UV treatment

COMMERCIALLY SENSITIVE

10 of 27

Case Study 1 | Value for Money Analysis in Regina

10

The Regina project experience shows that 20-30% savings can be achieved with private participation through the synergy of the Design Build Finance Operate process including, risk transfer, and cost certainties.

Further, EPCOR can shape the financing to better match customer growth, thus limiting rate increases and minimizing inter-generational inequities.

29.3%

20.1%

COMMERCIALLY SENSITIVE

11 of 27

Case Study 2 | Darlington Demineralize Water Treatment

Client	Ontario Power Generation
Project Dates	Project Start: 2022 Commissioned: Summer 2024
Delivery Method	DBFOM
Project Value	Overall Contract Price: $70M
Treatment Capacity	3MLD
Key Treatment Technologies	Raw water from Lake Ontario is treated to produce the ultra-pure demineralized process water utilized at the nuclear power plant for the purpose of steam production. Technologies include ultrafiltration, reverse osmosis, granular activated carbon, continuous electrodionization and mixed bed polishing.
Other Details	EPCOR is response for all O&M aspects of the facility including staffing, maintenance, major sustaining capital, chemical supply, laboratory analysis, and cyber security.

COMMERCIALLY SENSITIVE

11

12 of 27

Case Study 3 | Britannia Mine Water Treatment Plant

12

Client	Government of BC
Project Value	Overall Contract Price: $25M
Treatment Capacity	7MLD
Delivery Model	P3 DBFOM
Project Dates	2005 - Present
Project Overview	Acid rock drainage from Britannia mine entered the Howe Sound, killing all plant life around the outfall and driving away marine life. Using a fast-track approach, plant upgrades were substantially complete two months ahead of schedule and remove 1.3 million pounds of contaminants annually.
Innovation	Water collected from the mountain above the facility flows through a turbine to supply 70% of the electricity required to power the plant.

COMMERCIALLY SENSITIVE

12

13 of 27

Challenges creating Opportunity

13

Water and wastewater investments carry large risks

This type of infrastructure is very expensive for municipalities
Uncertain population and economic growth often hinders investment
Project risks include design, construction, finance, operations, environmental, regulatory and revenue
Political risk exists with the optics of private involvement with municipal water

An alternative delivery approach can better manage this risk

A Design Build Finance Operate & Maintain (DBFOM) approach can transfer risks to the contractor (EPCOR)
When risk adjusted over the life of a project, private financing can compete with public funds, and can be amplified with public-private partnerships (P3)
A DBFOM project does not have to include giving up municipal ownership

COMMERCIALLY SENSITIVE

14 of 27

Questions

COMMERCIALLY SENSITIVE

That covers off the projects I was hoping to highlight to you today and hope this was helpful
I’m happy to answer any questions you have, and from EPCOR’s perspective, our goal is really to provide the information necessary to fully explain these options and hopefully have them considered as part of any future competitive procurements
As I mentioned we’re quite focused on finding new partners to work with and grow in Ontario, and we’re happy to work with you to do some preliminary analysis to understand these options better

- If you are interested in discussing further we’re happy to provide you with a copy of the slide deck, and would love to continue the conversation at any time

Are there any pressures related to water / wastewater you are experiencing right now
Have you considered or are you familiar with some of these alternative models
What would be some of your concerns in exploring this further

15 of 27

15

Decentralized Water & Wastewater Solutions:

Unlocking Scalable, Sustainable Growth for Municipalities

Romina Ferrada

Domain Manager – Decentralized Wastewater

16 of 27

16

Ontario’s Infrastructure Challenge

Housing-enabling Infrastructure Gap
Aging Centralized Upgrades
Significant Investment and Long Lead Times
Growing Development Restrictions in Rural Ontario

17 of 27

Centralized vs. Decentralized Water Systems

17

Conventional or Centralized

> 1,000 m3/day

Communal or Decentralized

10 m3/day – 10,000 m3/day

Individual or On-Site

< 10 m3/day

18 of 27

Decentralized Servicing

Residential Development in Frontenac County

INDIVIDUAL SERVICING

COMMUNAL SERVICING

Individual Servicing

EP Block = 10.87 ha

16 Single Detached Lots

Density = 0.94 units/ha

Communal Servicing

EP Block = 14.24 ha

62 Total Units (41 Single Detached Lots & 9 Townhouses Lots)

Density = 4.63 units/ha

18

Development Area = 27.85 ha

19 of 27

Decentralized Wastewater Servicing

Background

Ontario

50 in the last 20 years

Colorado

17 in the last 5 years

19

20 of 27

20

Advantages of Decentralized Systems

Enable rural growth without mega-projects
Lower upfront and lifecycle costs
Lower footprint for infrastructure
No single point of failure
Faster deployment timelines

21 of 27

The Decentralized Approach

Modular treatment units designed for expansion
Best available technology
Fully monitored with smart tech
Designed for compliance and resilience

21

22 of 27

Wastewater

Membrane Bioreactor

Sequencing Batch Reactor

Moving Bed Bioreactors

Potable Water

Filtration

Clarification

Disinfection

Water Treatment

Technologies

22

23 of 27

23

Modular Water Treatment Systems

24 of 27

Overcoming Barriers

Barrier	Solution
Regulatory Complexity	Updates are in progress
Perceived Risk	Proven technologies and municipal models
Capital Constrains	Phased decentralized approach, funding and grants
Lack of Expertise	Operations training, smart monitoring

24

25 of 27

An Innovative Municipal Model

Municipally owned utility – to operate and manage the systems

Helps municipalities bypass costly upgrades

Eliminates the need for developers to enter into Municipal Responsibility Agreements (MRAs) with Municipalities

Pioneering decentralized infrastructure in rural Ontario

www.frontenacms.ca

Frontenac County Municipal Services Corporation (FMSC)

25

26 of 27

Empower Community Growth Through Innovation

Diversifying Ontario’s Water Strategy

Decentralized Solutions to Complement Centralized Infrastructure an Enable Community Growth

26

Centralized Treatment

Decentralized Treatment

27 of 27

Questions &�Discussion

Romina Ferrada

Domain Manager – Decentralized Wastewater

rferrada@newterra.com

(647) 309-1847

27