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<SEC-DOCUMENT>0000898080-04-000236.txt : 20040505
<SEC-HEADER>0000898080-04-000236.hdr.sgml : 20040505
<ACCEPTANCE-DATETIME>20040504180619
ACCESSION NUMBER:		0000898080-04-000236
CONFORMED SUBMISSION TYPE:	U5S
PUBLIC DOCUMENT COUNT:		5
CONFORMED PERIOD OF REPORT:	20031231
FILED AS OF DATE:		20040505
EFFECTIVENESS DATE:		20040505

FILER:

	COMPANY DATA:	
		COMPANY CONFORMED NAME:			EMERA INC
		CENTRAL INDEX KEY:			0001127248
		IRS NUMBER:				868143132
		FISCAL YEAR END:			1231

	FILING VALUES:
		FORM TYPE:		U5S
		SEC ACT:		1935 Act
		SEC FILE NUMBER:	030-00037
		FILM NUMBER:		04778987

	BUSINESS ADDRESS:	
		STREET 1:		P O BOX 910 CORPORATE SECY GENERAL COUNS
		CITY:			HALIFORC

	MAIL ADDRESS:	
		STREET 1:		P O BOX 910 CORPORATE SECY GENERAL COUNS
		CITY:			HALIFORC
</SEC-HEADER>
<DOCUMENT>
<TYPE>U5S
<SEQUENCE>1
<FILENAME>formu5s.txt
<DESCRIPTION>FORM U5S ANNUAL REPORT
<TEXT>

                UNITED STATES SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549

                                    Form U5S

                                  ANNUAL REPORT

                      For the year ended December 31, 2003

        Filed pursuant to the Public Utility Holding Company Act of 1935


                                   Emera Inc.
                            Emera U.S. Holdings, Inc.
                               BHE Holdings, Inc.

                                Mailing address:
                                  P.O. Box 910
                              Halifax, Nova Scotia
                                 Canada B3J 2W5

                                 Street address:
                             1894 Barrington Street
                           18th Floor Barrington Tower
                              Halifax, Nova Scotia
                                 Canada B3J 2W5


            --------------------------------------------------------
       (Name and address of each registered holding company in the system)



<PAGE>

                                                                               2

Item 1. System Companies and Investments Therein as of December 31, 2003

<TABLE>
<CAPTION>
- ----------------- -------------------- --------------- ----------------- -------------- -------------- ---------------
   Subsidiary       Name of Company       Form of             Number of   % of Voting    Issuer Book     Owner's Book
  Relationship                          Organization      Common Shares      Power          Value               Value
                                                                  Owned                                 (Cost Method)
- ----------------- -------------------- --------------- ----------------- -------------- -------------- ---------------
<S>              <C>                  <C>             <C>               <C>            <C>            <C>
0                 Emera Incorporated   Corporation                  N/A  N/A                                      N/A
                  ("Emera")
- ----------------- -------------------- --------------- ----------------- -------------- -------------- ---------------
1                 Emera U.S.           Corporation                2,784           100%                 $78,402,000 US
                  Holdings, Inc.
- ----------------- -------------------- --------------- ----------------- -------------- -------------- ---------------
1.1               BHE Holdings, Inc.   Corporation                2,784           100%                 $78,402,000 US

                                                         1216 preferred                                  $121,600,000
                                                                 shares                                            US

- ----------------- -------------------- --------------- ----------------- -------------- -------------- ---------------
1.1.1             Bangor               Corporation            7,363,424         98.99%                   $202,120,000
                  Hydro-Electric                                                                                   US
                  Company ("BHE")1
- ----------------- -------------------- --------------- ----------------- -------------- -------------- ---------------
1.1.1.1           Maine Electric       Corporation                1,249          14.2%     $878,500       $124,900 US
                  Power Company,                                                        US
                  Inc. ("MEPCO")
- ----------------- -------------------- --------------- ----------------- -------------- -------------- ---------------
1.1.1.2           Bangor Var Co.,      Corporation                5,000           100%                    $500,000 US
                  Inc.
- ----------------- -------------------- --------------- ----------------- -------------- -------------- ---------------
1.1.1.2.1         Chester SVC          Partnership         50% [general            50%       $0.00 US        $0.00 US
                  Partnership                               partnership
                  ("Chester SVC")                             interest]
- ----------------- -------------------- --------------- ----------------- -------------- -------------- ---------------
1.1.1.3           Bangor Energy        Corporation                1,000           100%                       $0.00 US
                  Resale, Inc.
- ----------------- -------------------- --------------- ----------------- -------------- -------------- ---------------
1.1.1.4           CareTaker, Inc.      Corporation                1,000           100%                    $777,745 US
- ----------------- -------------------- --------------- ----------------- -------------- -------------- ---------------
1.1.1.5           East Branch          Corporation                3,000            60%    $302,925 US      $21,000 US
                  Improvement
                  Company (*)
- ----------------- -------------------- --------------- ----------------- -------------- -------------- ---------------
1.1.1.5.1         Godfrey's Falls      Corporation                  126            60%       $0.00 US        $0.00 US
                  Dam Company (*)
- ----------------- -------------------- --------------- ----------------- -------------- -------------- ---------------
1.1.1.5.2         The Sawtelle Brook   Corporation                  100           100%       $0.00 US        $0.00 US
                  Dam & Improvement
                  Company (*)
- ----------------- -------------------- --------------- ----------------- -------------- -------------- ---------------
1.1.1.6           The Sebois Dam       Corporation                  100           100%                       $0.00 US
                  Company (*)
- ----------------- -------------------- --------------- ----------------- -------------- -------------- ---------------
1.1.1.7           The Pleasant River   Corporation                  100           100%       $0.00 US        $0.00 US
                  Gulf Improvement
                  Company (*)
- ----------------- -------------------- --------------- ----------------- -------------- -------------- ---------------
1.1.1.8           Bangor Fiber         Corporation                1,000           100%                  $1,700,156 US
                  Company, Inc.
- ----------------- -------------------- --------------- ----------------- -------------- -------------- ---------------
1.1.1.9           Bangor Line Company  Corporation                1,000           100%                       $0.00 US
- ----------------- -------------------- --------------- ----------------- -------------- -------------- ---------------
2                 Nova Scotia Power    Corporation           96,556,135           100%                   $830,606,598
                  Inc. ("NSPI") 2                                                                                 CDN
- ----------------- -------------------- --------------- ----------------- -------------- -------------- ---------------
3                 NS Power Services    Corporation                    1           100%                      $1.00 CDN
                  Ltd. (*)
- ----------------- -------------------- --------------- ----------------- -------------- -------------- ---------------
3.1               NSP Trigen Inc.      Corporation                  200            50%                      $1.00 CDN
                  (*)
- ----------------- -------------------- --------------- ----------------- -------------- -------------- ---------------
4                 Emera Fuels Inc 3    Corporation                    1           100%                 $6,961,389 CDN
- ----------------- -------------------- --------------- ----------------- -------------- -------------- ---------------
6                 Strait Energy Inc.   Corporation                    1           100%                      $1.00 CDN
- ----------------- -------------------- --------------- ----------------- -------------- -------------- ---------------
7                 Emera Utility        Corporation                    1           100%                      $1.00 CDN
                  Services Inc. 4
- ----------------- -------------------- --------------- ----------------- -------------- -------------- ---------------
7.1               Cablecom Ltd.        Corporation                  100           100%                   $150,000 CDN
- ----------------- -------------------- --------------- ----------------- -------------- -------------- ---------------
7.1.1             Fibretek Inc.        Corporation                 22.5           100%                   $351,025 CDN
- ----------------- -------------------- --------------- ----------------- -------------- -------------- ---------------
7.2               Utilismart           Corporation                    1                                  $163,000 CDN
                  Corporation                                            33%
                  (formerly 2008476
                  Ontario Ltd.)
- ----------------- -------------------- --------------- ----------------- -------------- -------------- ---------------
8                 NSP Pipeline         Corporation                    1           100%                      $1.00 CDN
                  Management Ltd.
- ----------------- -------------------- --------------- ----------------- -------------- -------------- ---------------
8.1               Martimes and         Corporation                               12.5%                      $1.00 CDN
                  Northeast Pipeline
                  Management Ltd.
- ----------------- -------------------- --------------- ----------------- -------------- -------------- ---------------
8.1.1             Maritimes and        Limited                                  0.125%
                  Northeast Pipeline   Partnership
                  Limited
                  Partnership (**)
- ----------------- -------------------- --------------- ----------------- -------------- -------------- ---------------


<PAGE>

                                                                               3

- ----------------- -------------------- --------------- ----------------- -------------- -------------- ---------------
9                 NSP Pipeline Inc.    Corporation                    1           100%                      $1.00 CDN
- ----------------- -------------------- --------------- ----------------- -------------- -------------- ---------------
9.1               Maritimes and        Limited                                 12.375%
                  Northeast Pipeline   Partnership
                  Limited
                  Partnership (**)
- ----------------- -------------------- --------------- ----------------- -------------- -------------- ---------------
10                NSP US Holdings      Corporation                    1           100%                      $1.00 CDN
                  Inc.
- ----------------- -------------------- --------------- ----------------- -------------- -------------- ---------------
                                                              6,912,900                                $6,912,900 CDN
                                                             (preferred
                                                        shares owned by
                                                           NSP Pipeline
                                                                  Inc.)
- ----------------- -------------------- --------------- ----------------- -------------- -------------- ---------------
10.1              NSP Investments      Corporation                1,000           100%                     $10.00 CDN
                  Inc.
- ----------------- -------------------- --------------- ----------------- -------------- -------------- ---------------
10.2              Scotia Holdings      Corporation                1,000           100%                  $4,500,000 US
                  Inc.
- ----------------- -------------------- --------------- ----------------- -------------- -------------- ---------------
10.2.1            Nova Power           Corporation                1,000           100%                  $4,500,000 US
                  Holdings Inc.
- ----------------- -------------------- --------------- ----------------- -------------- -------------- ---------------
10.2.1.1          Scotia Power U.S.    Corporation                1,000           100%                  $4,500,000 US
                  Ltd.
- ----------------- -------------------- --------------- ----------------- -------------- -------------- ---------------
10.2.1.1.1        Maritimes and        Limited                                   12.5%
                  Northeast Pipeline   Liability
                  L.L.C. (**)          Company
- ----------------- -------------------- --------------- ----------------- -------------- -------------- ---------------
11                1447585 Ontario      Corporation                   20           100%                     $10,100 US
                  Ltd. (*)
- ----------------- -------------------- --------------- ----------------- -------------- -------------- ---------------
11.1              Ontario 8 Group      Limited              $10,000 USD           100%                     $10,000 US
                  Financing Limited    Liability                  (cash
                  Liability Company    Company             contribution
                  (*) only)
- ----------------- -------------------- --------------- ----------------- -------------- -------------- ---------------
12                Emera Energy Inc. 5  Corporation                    1           100%                      $1.00 CDN
- ----------------- -------------------- --------------- ----------------- -------------- -------------- ---------------
12.1              Emera Energy U.S.    Corporation                1,250           100%                  $2,500,000 US
                  Subsidiary No. 1,
                  Inc.
- ----------------- -------------------- --------------- ----------------- -------------- -------------- ---------------
12.1.1            Emera Energy U.S.    Corporation                1,000           100%                  $2,501,000 US
                  Subsidiary No. 2,
                  Inc.
- ----------------- -------------------- --------------- ----------------- -------------- -------------- ---------------
12.1.1.1          Greyhawk Gas         Limited           500,000 (Class            50%                  $3,700,000 US
                  Storage Company,     Liability               A Units)
                  L.L.C. (**)          Company
- ----------------- -------------------- --------------- ----------------- -------------- -------------- ---------------
12.1.2            Emera Energy         Corporation                  100           100%                     $100.00 US
                  Services Inc.
- ----------------- -------------------- --------------- ----------------- -------------- -------------- ---------------
13                3065381 Nova         Corporation              2020.33           100%                    $31,691,121
                  Scotia Company       (unlimited                                                                 CDN
                                       liability)
- ----------------- -------------------- --------------- ----------------- -------------- -------------- ---------------
14                3065383 Nova         Corporation              2020.33           100%                    $31,691,121
                  Scotia Company       (unlimited                                                                 CDN
                                       liability)
- ----------------- -------------------- --------------- ----------------- -------------- -------------- ---------------
15                3065384 Nova         Corporation              2020.33           100%                    $31,691,121
                  Scotia Company       (unlimited                                                                 CDN
                                       liability)
- ----------------- -------------------- --------------- ----------------- -------------- -------------- ---------------
16                3065385 Nova         Corporation            2062.6164           100%                    $97,603,351
                  Scotia Company       (unlimited                                                                 CDN
                                       liability)
- ----------------- -------------------- --------------- ----------------- -------------- -------------- ---------------
17                Emera Investments    Corporation                                100%                   $5,715,496US
                  LLC (3)5
- ----------------- -------------------- --------------- ----------------- -------------- -------------- ---------------
</TABLE>

(*) Denotes inactive subsidiaries.

(**) Under Rule 16, Maritimes and Northeast Pipeline Management Ltd., Maritimes
and Northeast Pipeline Limited Partnership, Maritimes and Northeast Pipeline
L.L.C., and Greyhawk Gas Storage Company, L.L.C. are exempt from all
obligations, duties or liabilities imposed upon them by the Act as a subsidiary
or as an affiliate of a registered holding company thereof, as such terms are
respectively defined in Sections 2(a)(8)(A) and 2(a)(11) of the Act.


1.   1.01% of the voting power of Bangor Hydro-Electric Company is held by the
     holders of the outstanding 7% series of preferred stock. Each share is
     entitled to one vote and 6277 shares remain outstanding.


<PAGE>

                                                                               4

2.   2230823 Nova Scotia Limited (formerly Stellarton Basin Coal Gas
     Incorporated), which was identified as system company 5 on Emera's Form U5S
     Annual Report for 2002, was transferred to Nova Scotia Power Inc. ("NSPI")
     during 2003 and subsequently surrendered its Certificate of Incorporation
     as of December 12, 2003.

3.   W. L. Power Limited, which was identified as system company 4.1 on Emera's
     Form U5S Annual Report for 2002, was continued into the Province of Nova
     Scotia as of July 17, 2003 as 3074462 Nova Scotia Limited, which
     subsequently surrendered its certificate of incorporation as of November
     26, 2003.

4.   As of March 31, 2003, Emera Utility Services Inc. ("EUS") and NSPI entered
     into an Agreement of Purchase and Sale pursuant to which EUS acquired
     NSPI's interest in Utilismart Corporation.

5.   In connection with the disposition of Emera's 8.4% interest in the Sable
     Offshore Energy Project, 3056567 Nova Scotia Limited, 3056568 Nova Scotia
     Limited, and Emera Offshore Incorporated, which were respectively
     identified on Emera's Form U5S Annual Report for 2002 as system companies
     12.1, 12.1.1, and 12.1.1.1, were amalgamated with Emera Energy Incorporated
     as of November 21, 2003.

Item 2. Acquisitions or Sales of Utility Assets

Response: During 2003, Bangor Hydro-Electric Company constructed and retained
ownership of a 115KV transmission line running between Chester and East
Millinocket in Maine. This line is valued at $10,000,000 (U.S.), and is exempt
from the Act pursuant to section 9 (b)(1) since the line's construction was
authorized by the Maine Public Utilities Commission pursuant to an Interim Order
dated October 23, 2002 and a Final Order dated April 23, 2003, copies of which
are attached hereto as Exhibit F.

Item 3. Issue, Sale, Pledge, Guarantee or Assumption of System Securities

Response: No securities have been issued, sold, or pledged, nor have any
securities been guaranteed or assumed by system companies other than those
issuances reported in the Certificates of Notification filed pursuant to Rule 24
for 2003.

Item 4. Acquisition, Redemption or Retirement of System Securities

Response: In addition to the disclosures articulated in the footnotes to Item 1,
system securities were acquired, redeemed and retired in connection with the
sale and windup of Stellarton Basin Coal Gas Inc. ("SBC"). A subsidiary of SBC,
3081957 Nova Scotia Limited, was incorporated during 2003. Following its
incorporation, Emera conveyed a promissory note which had been issued by SBC,
and which possessed a face value of $9.8 million (CDN), to this subsidiary, and
as consideration, Emera took back a promissory note with a face value of $3.1
million, which represented the fair market value of the note.

This subsidiary was subsequently wound up into SBC on December 1, 2003, at which
time the promissory note in the amount of $3.1 million (CDN) was converted into
an additional 100 common shares of SBC. Emera then conveyed SBC to NSPI with the
sale being valued at $3.1 million (CDN),


<PAGE>

                                                                               5

and as consideration, NSPI issued Emera additional common shares. On December
12, 2003 SBC surrendered its certificate of incorporation and was thereby
dissolved.

Item 5. Investments in Securities of Nonsystem Companies

Response:

Category 1: There were no investments during the reporting period made in
persons that are customers of Emera's utility subsidiaries.

Category 2: Investments in other non-system entities not included in Category 1:

<TABLE>
<CAPTION>
- -------------- ------------ ------------ ------------ ------------ ------------------------- ------------
Acquiring      Issuing      Type of      Number of    Percentage   General Nature of         Book value
Company        Company      Security     Shares or    of Voting    Issuer's Business         (Equity
                                         Units Held   Power                                  Method)
                                         by Acquirer
- -------------- ------------ ------------ ------------ ------------ ------------------------- ------------
<S>           <C>          <C>          <C>          <C>          <C>                        <C>
BHE            Maine        Common       20,251       7%           Former nuclear power      $3,109,708
               Yankee       Stock                                  plant in the process of   (US)
               Atomic                                              decommissioning.
               Power                                                                         [$1,529,385
               Company                                                                       (US)
                                                                                             utilizing
                                                                                             the cost
                                                                                             method]

- -------------- ------------ ------------ ------------ ------------ ------------------------- ------------
</TABLE>

Item 6. Officers and Directors

Part I. As of December 31, 2003:

<TABLE>
<CAPTION>
- --------------------------------------- --------------------------------- -----------------------------------
               Company                             Directors                           Officers
- --------------------------------------- --------------------------------- -----------------------------------
<S>                                   <C>                                <C>
Emera                                   Derek Oland                       David McD. Mann, President and
                                        David McD. Mann                   Chief Executive Officer
                                        Robert S. Briggs                  Christopher G. Huskilson, Chief
                                        George A. Caines                  Operating Officer
                                        Purdy Crawford                    Ronald E. Smith, Senior
                                        R. Irene d'Entremont              Vice-President and Chief
                                        James K. Gray                     Financial Officer
                                        M. Edward MacNeil                 Richard J. Smith, Corporate
                                        Elizabeth Parr-Johnston           Secretary and General Counsel
                                        (Director of the Bank of Nova     Elizabeth A. MacDonald,
                                        Scotia)                           Vice-President Human Resources
                                        Kenneth C. Rowe                   James L. Connors, Vice-President
                                        Rosemary Scanlon                  Regulatory Affairs
                                        Paul D. Sobey (Director of the    Ian A. Thompson, Vice-President
                                        Bank of Nova Scotia)              External Relations
- --------------------------------------- --------------------------------- -----------------------------------
Nova Scotia Power Incorporated          Derek Oland                       David McD. Mann, President and
                                        David McD. Mann                   Chief Executive Officer
                                        Robert S. Briggs                  Christopher G. Huskilson, Chief
                                        George A. Caines                  Operating Officer
                                        Purdy Crawford                    Richard J. Smith, Corporate
                                        R. Irene d'Entremont              Secretary and General Counsel
                                        James K. Gray
                                        M. Edward MacNeil
                                        Elizabeth Parr-Johnston
                                        (Director of the Bank of Nova
                                        Scotia) Kenneth C. Rowe Rosemary Scanlon
                                        Paul D. Sobey (Director of the Bank of
                                        Nova Scotia)
- --------------------------------------- --------------------------------- -----------------------------------
NS Power Services Ltd.                  Richard J. Smith                  Richard J. Smith, President and
                                                                          Secretary
- --------------------------------------- --------------------------------- -----------------------------------


<PAGE>

                                                                               6

- --------------------------------------- --------------------------------- -----------------------------------
               Company                             Directors                           Officers
- --------------------------------------- --------------------------------- -----------------------------------
NSPI/Trigen Inc.                        David McD. Mann                   Susan Shaw, Chairman of the Board
                                        Thomas R. Casten                  Richard J. Smith, Corporate
                                        Michael Weiser Secretary
                                        Susan Shaw, Chair
- --------------------------------------- --------------------------------- -----------------------------------
Emera Fuels Inc.                        David McD. Mann                   David McD. Mann, President
                                                                          Ronald E. Smith, Vice-President
                                                                          and Chief Financial Officer
                                                                          Richard J. Smith, Corporate
                                                                          Secretary and General Counsel
- --------------------------------------- --------------------------------- -----------------------------------
Emera Utility Services Inc.             David McD. Mann                   Christopher G. Huskilson,
                                                                          President
                                                                          Richard J. Smith, Secretary
                                                                          William E. Hattie, Vice-President
                                                                          Utility Services
                                                                          Ron Smith, Vice-President Finance
- --------------------------------------- --------------------------------- -----------------------------------
Cablecom Ltd.                           David McD. Mann                   Christopher G. Huskilson,
                                                                          President
                                                                          Richard J. Smith, Corporate
                                                                          Secretary
                                                                          William E. Hattie, Vice-President
                                                                          Ron Smith, Vice-President Finance
- --------------------------------------- --------------------------------- -----------------------------------
Fibretek Inc.                           David McD. Mann                   Christopher G. Huskilson,
                                                                          President
                                                                          Richard J. Smith, Corporate
                                                                          Secretary
                                                                          William E. Hattie, Vice-President
                                                                          Ron Smith, Vice-President Finance
- --------------------------------------- --------------------------------- -----------------------------------
Strait Energy Inc.                      David McD. Mann                   David McD. Mann, President
                                        Richard J. Smith                  Richard J. Smith, Corporate
                                                                          Secretary
- --------------------------------------- --------------------------------- -----------------------------------
NSP Pipeline Management Ltd.            David McD. Mann                   David McD. Mann, President
                                        Richard J. Smith                  Richard J. Smith, Corporate
                                                                          Secretary
- --------------------------------------- --------------------------------- -----------------------------------
NSP Pipeline Inc.                       David McD. Mann                   David McD. Mann, President
                                        Richard J. Smith                  Richard J. Smith, Corporate
                                                                          Secretary
- --------------------------------------- --------------------------------- -----------------------------------
NSP Investments Inc.                    A. Michael Burnell                A. Michael Burnell, President,
                                                                          Secretary and Treasurer
                                                                          Richard J. Smith, Assistant
                                                                          Corporate Secretary
- --------------------------------------- --------------------------------- -----------------------------------
NSP US Holdings Inc.                    David McD. Mann                   David McD. Mann, President
                                        Richard J. Smith                  Ray Robinson, Vice-President
                                                                          Utility Integration
                                                                          Richard J. Smith, Corporate
                                                                          Secretary
- --------------------------------------- --------------------------------- -----------------------------------
Scotia Holdings Inc.                    A. Michael Burnell                A. Michael Burnell, President,
                                                                          Secretary and Treasurer
                                                                          Richard J. Smith, Assistant
                                                                          Corporate Secretary
- --------------------------------------- --------------------------------- -----------------------------------
Nova Power Holdings Inc.                A. Michael Burnell                A. Michael Burnell, President,
                                                                          Secretary and Treasurer
                                                                          Richard J. Smith, Assistant
                                                                          Corporate Secretary
- --------------------------------------- --------------------------------- -----------------------------------
Scotia Power U.S. Ltd.                  A. Michael Burnell                A. Michael Burnell, President,
                                                                          Secretary and Treasurer
                                                                          Richard J. Smith, Assistant
                                                                          Corporate Secretary
- --------------------------------------- --------------------------------- -----------------------------------
Emera Energy Inc.                       David McD. Mann                   David McD. Mann, President
                                                                          Ronald E. Smith, Vice-President
                                                                          Finance
                                                                          Todd J. Sattler, Vice-President
                                                                          Energy Services
                                                                          Richard J. Smith, Corporate
                                                                          Secretary
- --------------------------------------- --------------------------------- -----------------------------------
Emera US Holdings Inc.                  A. Michael Burnell                A. Michael Burnell, President and
                                                                          Secretary
                                                                          Richard J. Smith, Assistant
                                                                          Corporate Secretary
- --------------------------------------- --------------------------------- -----------------------------------
BHE Holdings Inc.                       A. Michael Burnell                A. Michael Burnell, President and
                                                                          Secretary
                                                                          Richard J. Smith, Assistant
                                                                          Corporate Secretary
- --------------------------------------- --------------------------------- -----------------------------------
1447585 Ontario Ltd.                    Richard J. Smith                  Richard J. Smith, President and
                                                                          Corporate Secretary
- --------------------------------------- --------------------------------- -----------------------------------
- --------------------------------------- --------------------------------- -----------------------------------
Ontario 8 Group Financing LLC           Richard J. Smith                  Belani Stehli, Managing Director
- --------------------------------------- --------------------------------- -----------------------------------


<PAGE>

                                                                               7

- --------------------------------------- --------------------------------- -----------------------------------
               Company                             Directors                           Officers
- --------------------------------------- --------------------------------- -----------------------------------
Emera Energy U.S. Subsidiary No. 1,     A. Michael Burnell                A. Michael Burnell, President and
Inc.                                                                      Secretary
                                                                          Richard J. Smith, Assistant
                                                                          Secretary
- --------------------------------------- --------------------------------- -----------------------------------
Emera Energy U.S. Subsidiary No. 2,     A. Michael Burnell                A. Michael Burnell, President and
Inc.                                                                      Secretary
                                                                          Richard J. Smith, Assistant
                                                                          Secretary
- --------------------------------------- --------------------------------- -----------------------------------
Emera Energy Services Inc.              A. Michael Burnell                A. Michael Burnell, President,
                                                                          Secretary and Treasurer
                                                                          Richard J. Smith, Assistant
                                                                          Secretary
- --------------------------------------- --------------------------------- -----------------------------------
Emera Investments, LLC                  A. Michael Burnell                A. Michael Burnell, President
                                                                          Richard J. Smith, Secretary
- --------------------------------------- --------------------------------- -----------------------------------
3065381 Nova Scotia Company             David McD. Mann                   David McD. Mann, President
                                        Richard J. Smith                  Richard J. Smith, Secretary
- --------------------------------------- --------------------------------- -----------------------------------
3065383 Nova Scotia Company             David McD. Mann                   David McD. Mann, President
                                        Richard J. Smith                  Richard J. Smith, Secretary
- --------------------------------------- --------------------------------- -----------------------------------
3065384 Nova Scotia Company             David McD. Mann                   David McD. Mann, President
                                        Richard J. Smith                  Richard J. Smith, Secretary
- --------------------------------------- --------------------------------- -----------------------------------
3065385 Nova Scotia Company             David McD. Mann                   David McD. Mann, President
                                        Richard J. Smith                  Richard J. Smith, Secretary
- --------------------------------------- --------------------------------- -----------------------------------
Bangor Hydro-Electric Company           Jane J. Bush (President of        David McD. Mann, Chairman
                                        Coastal Ventures)                 (President and CEO and Director
                                        Christopher G. Huskilson, (COO    of Emera)
                                        of Emera and NSPI)                Christopher G. Huskilson, Vice
                                        Normal A. Ledwin (President and   Chairman (COO of Emera and NSPI)
                                        CEO and Director of Eastern       Raymond R. Robinson, COO
                                        Maine Healthcare)                 David R. Black, Treasurer and
                                        Elizabeth A. MacDonald (Vice      Controller, CFO
                                        President, Human Resources of     Andrew Landry, Corporate Clerk
                                        Emera)                            Richard J. Smith, Secretary
                                        David McD. Mann, Chairman         (Corporate Secretary and General
                                        (President and CEO and Director   Counsel of Emera)
                                        of Emera)                         Edith L. Lilly, Assistant
                                        Ronald E. Smith (Senior Vice      Corporate Secretary (Assistant
                                        President and CFO of Emera)       Corporate Secretary of Emera)
- --------------------------------------- --------------------------------- -----------------------------------
East Branch Improvement Co.             Christopher Huskilson             Raymond Robinson, President
                                        Raymond Robinson                  David R. Black, Treasurer
                                        Gregory Hines                     Richard J. Smith, Secretary
                                        Marsha McKeague
                                        Eldon Dood
- --------------------------------------- --------------------------------- -----------------------------------
The Sawtelle Brook Dam & Improvement    Christopher Huskilson             Raymond Robinson, President
Company                                 Raymond Robinson                  David R. Black, Treasurer
                                        Gregory Hines                     Richard J. Smith, Secretary
                                        Marsha McKeague
                                        Eldon Dood
- --------------------------------------- --------------------------------- -----------------------------------
Godfrey's Falls Dam Company             Christopher Huskilson             Raymond Robinson, President
                                        Raymond Robinson                  David R. Black, Treasurer
                                        Gregory Hines                     Richard J. Smith, Secretary
                                        Marsha McKeague
                                        Eldon Dood
- --------------------------------------- --------------------------------- -----------------------------------
Bangor Var Co., Inc                     Raymond Robinson                  Raymond Robinson, President
                                        Gregory Hines                     David R. Black, Treasurer
                                        Robert Bennett                    Richard J. Smith, Secretary
- --------------------------------------- --------------------------------- -----------------------------------
Bangor Energy Resale, Inc.              Raymond Robinson                  Raymond Robinson, President
                                        Gregory Hines                     David R. Black, Treasurer
                                        Robert Bennett                    Richard J. Smith, Secretary
- --------------------------------------- --------------------------------- -----------------------------------
Caretaker, Inc.                         Raymond Robinson                  Raymond Robinson, President
                                        Gregory Hines                     David R. Black, Treasurer
                                        Robert Bennett                    Richard J. Smith, Secretary

- --------------------------------------- --------------------------------- -----------------------------------
Bangor Fiber Company, Inc.              Raymond Robinson                  Raymond Robinson, President
                                        Gregory Hines                     David R. Black, Treasurer
                                        Robert Bennett                    Richard J. Smith, Secretary

- --------------------------------------- --------------------------------- -----------------------------------
Bangor Line Company                     Raymond Robinson                  Raymond Robinson, President
                                        Gregory Hines                     David R. Black, Treasurer
                                        Robert Bennett                    Richard J. Smith, Secretary

- --------------------------------------- --------------------------------- -----------------------------------


<PAGE>

                                                                               8

- --------------------------------------- --------------------------------- -----------------------------------
               Company                             Directors                           Officers
- --------------------------------------- --------------------------------- -----------------------------------
The Sebois Dam Company/1                                                  Andrew Landry, Clerk

- --------------------------------------- --------------------------------- -----------------------------------
The Pleasant River Gulf Improvement                                       Andrew Landry, Clerk
Co. /1
- --------------------------------------- --------------------------------- -----------------------------------
</TABLE>

1 The Sebois Dam Company and The Pleasant River Gulf Improvement Company are
both inactive and excused from State of Maine annual reporting requirements.
There are no officers and directors for these companies other than the Clerk.

The business address of the following persons is P.O. Box 910, Halifax, Nova
Scotia, Canada B3J 2W5:

Derek Oland
David McD. Mann
Robert S. Briggs
George A. Caines
Purdy Crawford
R. Irene d'Entremont
James K. Gray
M. Edward MacNeil
Elizabeth Parr-Johnston
Kenneth C. Rowe
Rosemary Scanlon
Paul D. Sobey
Christopher G. Huskilson
Ronald E. Smith
Richard J. Smith
Elizabeth A. MacDonald
James L. Connors
Ian A. Thompson
William E. Hattie
Todd J. Sattler
Edith L. Lilly

The company for which the following individuals are identified as directors, NSP
Trigen Inc., is inactive, and as a result, the principal business address for
these individuals is unknown:

Thomas R. Casten
Michael Weiser
Susan Shaw

The business address of the following persons is 1132 Budapest, Hungary, 2600
Vac, Gombasi ut 26/B:

Belani Stehli


<PAGE>

                                                                               9

The business address of the following persons is 33 State Street, Bangor, Maine
04401:

Ray Robinson
Jane J. Bush
Normal A. Ledwin
David R. Black
Andrew Landry
Gregory Hines
Robert Bennett

The following individuals are Katahdin Timberland's representatives on the
Boards of Directors of East Branch Improvement Company, The Sawtelle Brook Dam &
Improvement Company, and the Sebois Dam Company, and these individuals possess a
business address at Millinocket, Maine 04462.

Marsha McKeague
Eldon Dood

The business address of the following persons is 566 Washington Road, Rye, New
Hampshire 03870:

A. Michael Burnell

Part II. Financial Connections of Officers and Directors

<TABLE>
<CAPTION>
- ------------------------------- ---------------------------- ---------------------------- ----------------------------
 Name of Officer or Director         Name and Location             Position Held in                 Applicable
                                        of Financial            Financial Institution             Exemption Rule
                                        Institution
- ------------------------------- ---------------------------- ---------------------------- ----------------------------
<S>                            <C>                          <C>                          <C>
Elizabeth Parr-Johnston         Bank of Nova Scotia, Nova    Director of the Bank of      No-action letter request
                                Scotia, Canada               Nova Scotia                  dated October 9, 2001.
- ------------------------------- ---------------------------- ---------------------------- ----------------------------
Kenneth C. Rowe                 Royal Bank of Canada,        Director of the Royal Bank   No-action letter request
                                Toronto, Canada 1            of Canada                    dated October 9, 2001.
- ------------------------------- ---------------------------- ---------------------------- ----------------------------
Paul D. Sobey                   Bank of Nova Scotia, Nova    Director of the Bank of      No-action letter request
                                Scotia, Canada               Nova Scotia                  dated October 9, 2001.
- ------------------------------- ---------------------------- ---------------------------- ----------------------------
</TABLE>

1 Mr. Rowe retired from the Board of Directors of the Royal Bank of Canada and
ceased to be a Director as of February 28, 2003.

Part III. Certain Disclosures With Respect to Officers and Directors
          Compensation

Compensation of Directors of Emera Inc./1

Each Director, other than the President and Chief Executive Officer, is paid a
retainer of $20,000 per year; a fee of $1,250 for each Board, Committee, or
Shareholders' Meeting held via teleconference; a fee of $1,750 for each Board,
Committee and Shareholders' Meeting attended in person; and $1,750 if a day's
travel time was required to attend such meetings. The Chair of each Committee of
the Board receives an additional retainer of $3,000 per year, with the exception
of the Chair of the Audit Committee who receives an additional retainer in the
amount of $5,000. In addition to the Directors' retainer and per meeting fees,
the Chairman of the Board receives a retainer of $80,000 per year.


- --------
1 All figures are expressed in Canadian currency.


<PAGE>

                                                                              10

All Directors are reimbursed for expenses incurred for attendance at Board,
Committee, and Shareholders' Meetings and on Company business. Directors are
eligible to participate in certain group health benefits which are available to
employees and, if they choose to participate, are required to contribute to
premium costs of such benefits in the same fashion as employees.

During 2003, the Directors established a Directors Deferred Share Unit Plan (the
"Plan"). Under this Plan, Directors who are resident in Canada may elect to
receive all or any portion of their compensation in deferred share units (DSUs)
in lieu of cash compensation. Directors' fees are paid on a quarterly basis and
at the time of each payment of fees, the applicable amount is converted to DSUs.
A DSU is a bookkeeping entry that has a value equal to one Emera common share.
When a dividend is paid on Emera's common shares, the Director's DSU account is
credited with additional DSUs. DSUs cannot be redeemed for cash until the
Director retires, resigns, or otherwise leaves the Board. The cash redemption
value of a DSU equals the market value of a common share at the time of
redemption, pursuant to the Plan.

The Directors have established share ownership guidelines whereby a newly
appointed Director is required to own five times the annual Directors' retainer
(i.e. $100,000) in common shares or share equivalent (eg. DSUs) within the first
five years of membership on the Board. For existing Board members, ownership
must occur within five years of the 2003 implementation date.

Compensation of Named Executive Officers

The "Summary Compensation Table" sets out compensation information for the
fiscal year ended December 31, 2003 for the President and Chief Executive
Officer and the next four most highly compensated individuals of the Company, or
its affiliated companies.


<PAGE>

                                                                              11

<TABLE>
<CAPTION>
                                                SUMMARY COMPENSATION TABLE
                                                                                Securities       Restricted
         Name and                       Annual        Annual     Other Annual     Under          Share Units         All other
    Principal Position                  Salary        Bonus      Compensation    Options           (RSUs)          Compensation
                             Year      (Cdn $)       (Cdn $)       (Cdn $)         (#)         (#)      ($)(1)      (Cdn $) (2)
- ----------------------------------------------------------------------------------------------------------------------------------
<S>                        <C>       <C>          <C>             <C>          <C>          <C>        <C>         <C>
D.McD. Mann                  2003      550,000     357,500 (3)         Nil      131,800       21,400    381,990           7,882
President and Chief
Executive Officer
Emera Inc. and
Nova Scotia Power Inc.

- ----------------------------------------------------------------------------------------------------------------------------------
C.G. Huskilson 4
Chief Operating Officer      2003      359,615     210,600 (3)         Nil       69,000       11,200    199,920           6,625
Emera Inc.


- ----------------------------------------------------------------------------------------------------------------------------------
R.E. Smith
Sr. Vice-President and       2003     275,000      143,000 (3)         Nil       46,100        7,500    133,875           5,467
Chief Financial Officer
Emera Inc.


- ----------------------------------------------------------------------------------------------------------------------------------
R.R. Robinson
Chief Operating Officer      2003    219,471(8)    92,268(3)(5)        Nil       23,100        3,700     66,045             858
Bangor Hydro-Electric
Company

- ----------------------------------------------------------------------------------------------------------------------------------
J.T. Sattler (6)
Vice-President               2003      181,731      227,500       198,431(7)     12,600        2,000     35,700           2,406
Energy Services
Emera Energy Inc.

- ----------------------------------------------------------------------------------------------------------------------------------
</TABLE>

Notes:

(1)  RSUs are granted annually for three-year overlapping performance cycles.
     The first cycle runs from January 1, 2003 through to December 31, 2005 and
     the RSUs shall not vest until December 31, 2005. RSUs are granted at the
     fair market value of Emera's shares on the grant date and dividend
     equivalents are awarded and used to purchase additional RSUs. The value of
     the RSUs vary in accordance with Emera's share price in the market.
     Entitlement to payout is determined by the Management Resources and
     Compensation Committee and actual payout will be based upon the value of
     Emera's common shares at the time of vesting and may differ from the amount
     shown above. This column represents an estimate of payouts, for
     illustrative purposes, and is based upon the market value of the Company's
     common share closing price on December 31, 2003.
(2)  Amounts in this column reflect premiums paid by the Company and affiliated
     companies for term life insurance and contributions to the Employee Common
     Share Purchase Plan.
(3)  In lieu of cash payment Mr. Mann, Mr. Smith, and Mr. Huskilson elected to
     allocate 100% of their bonuses to receive DSUs under the Deferred Share
     Unit Plan in place for officers and senior managers of Emera. Mr. Robinson
     elected to allocate 25%. Based on a December 31, 2003 closing price of
     $17.85, Mr. Mann received 20,028 DSUs; Mr. Huskilson received 11,798 DSUs;
     Mr. Smith received 8,011 DSUs; and Mr. Robinson received 3,714 DSUs.
(4)  Mr. Huskilson was appointed Chief Operating Officer of Emera Inc. on July
     4, 2003. Previously, he was the Chief Operating Officer, Nova Scotia Power
     Inc.
(5)  These amounts are paid in U.S. dollars and reflect a conversion to Canadian
     dollars at the December 31, 2003 exchange rate of $1.2924.
(6)  Mr. Sattler commenced employment in October 2002.
(7)  Mr. Sattler's contract provides for an annual supplement to his salary that
     allows for the same after-tax income as if his salary were earned in US
     currency since Mr. Sattler relocated from the United States.

Item 7. Contributions and Public Relations

Response: The Province of Nova Scotia has in force a Lobbyists' Registration
Act, which requires the registration of "in-house lobbyists". The Act defines an
"in-house lobbyist" as an individual, a part of whose duties include, lobbying
on behalf of a corporation or a subsidiary of such corporation. As of December
31, 2003 Emera has registered five individuals pursuant to the Act at a cost of


<PAGE>

                                                                              12

$50.00 CDN per lobbyist, which equates to an expenditure of $250.00 CDN. These
individuals are employees of Emera and their aggregate compensation for 2003
equates to $1,483,992 (CDN).

Three of Emera's registered lobbyists are members of the Emera executive staff.
These individuals record the allocation of their time on a daily basis, and
their salaries are allocated to the Emera system company to which their work
relates. The salary of one of the other lobbyists is allocated entirely to Emera
Energy Inc., while the salary of the remaining lobbyist is allocated to system
companies based on the factor for the individual's cost center in accordance
with Emera's policy concerning the allocation of costs.

Bangor Hydro-Electric Company expended $51,153.43 (U.S.) on a single lobbyist
located within the State of Maine who was retained to lobby with respect to
proposed legislative changes. These expenditures were charged to FERC Account
426 or a subaccount thereof.

Further details concerning Emera's contributions and public relations
expenditures will be filed by way of an amendment to its Annual Report on Form
U5S.

Item 8. Service, Sales and Construction Contracts

Part I. Contracts for Services or Goods Supplied by a System Company to Another
System Company

Response: On March 21, 2003, Emera provided the SEC staff with a detailed report
on affiliate transactions activity. The materials filed noted that transactions
between NSPI and its affiliates are governed by an Interim Code of Conduct which
was approved by the Nova Scotia Utility and Review Board on March 16, 2001. This
Interim Code of Conduct is in force until a final code of conduct is approved by
the Nova Scotia Utility and Review Board. The types of transactions identified
in the materials filed, include affiliates which provide NSPI petroleum
products, transformers, coal transportation services, pole and cable maintenance
services, and communication cabling services. Transactions involving BHE also
were reported. There were no material changes during 2003 concerning the types
of transactions entered into between affiliates.

Part II. Affiliate Contracts

Response: There are no contracts to purchase services or goods from any
affiliate (other than a system company) or from a company in which any officer
or director of the receiving company is a partner or owns 5% or more of any
class of equity securities.

Part III. Persons Employed to Provide Management, Supervisory or Financial
Advisory Services

Response: Emera has not retained individuals or firms to provide management,
supervisory, or financial advisory services. BMO Nesbitt Burns Inc., CIBC World
Markets Inc., National Bank Financial Inc., RBC Dominion Securities Inc., Scotia
Capital Inc., and TD Securities were retained as agents ("Agents") to solicit
offers to purchase notes from the sale of Medium Term Notes ("Notes") under
Emera's Medium Term Note program. These agents may provide financial advice in
the course of their duties.


<PAGE>

                                                                              13

Pursuant to the Selling Agency Agreement dated August 16, 2002 (the "Agreement")
among Emera and the Agents, the Agents are authorized, as agents of Emera for
this purpose only, to solicit offers to purchase Notes, in Canada only, directly
and through other Canadian investment dealers. Emera will pay each Agent through
whom any Note is sold a commission not to exceed .50% of the principal amount of
any Note unless otherwise agreed and disclosed in a supplement. The Agreement
also provides that Notes may be purchased by any of the Agents from time to
time, as principals, at such prices as may be agreed upon between Emera and such
Agents for resale to the public. Such resale prices may vary during the
distribution period and as between purchasers. Commissions may be paid in
connection with such purchases. The Agents' compensation will be increased or
decreased by the amount by which the aggregate price paid for Notes by
purchasers exceeds or is less than the gross proceeds paid by the Agent, acting
as principal, to Emera.

In addition to Ernst & Young's role as auditor of Emera, and the provision of
audit related services, Ernst & Young has provided tax advice in connection with
various corporate structures, and during 2003,Emera paid Ernst & Young
$1,775,621 CDN in connection with tax-related services.

Employees of Emera and its affiliated companies, with the exception of Bangor
Hydro-Electric Company, participate in the Nova Scotia Power Pension Plan (the
"Plan"). The Plan allows employees to participate in either a Defined Benefit or
a Defined Contribution provision. The following firms have been retained to
provide advisory services on behalf of the Defined Benefit Plan: Phillips, Hager
& North Investment Management Ltd.; BonaVista Asset Management Limited; Seamark
Asset Management Ltd.; Knight, Bain, Seath and Holdbrook Capital Management
Inc.; Galileo Equity Management Inc.; State Street Global Advisors, Ltd.;
Capital Guardian Trust Company, Foyston Gordon & Payne Inc., Letko, Brosseau &
Associates Inc., and QVGD Investors Inc. (collectively the "Advisors"). The
scope of services of each of these Advisors is identical, and these Advisors are
compensated on a quarterly basis. The compensation equates to a percentage of
the market value of the respective portfolios at the close of the respective
quarter.

The Manufacturers Life Insurance Company has been retained to assist in the
administration of the Defined Contribution Plan. The services provided include
documentation of an Investment Policy and Plan Services Agreement and Financial
Plan Document, administration of member benefits and report preparation for each
Member, Plan Sponsor and regulatory requirements. Compensation is paid through
investment management fees as a percentage applied to and deducted from each
Pooled Fund on each Valuation Date.

Bangor Hydro-Electric Company has a separate pension plan which has retained the
following firms to provide advisory services on behalf of the pension plan:
State Street Global Advisors; Capital Guardian Trust Company; and Wellington
Trust Company (collectively the "Bangor Hydro Advisors"). The Bangor Hydro
Advisors provide services which are identical in scope, and these advisors' fees
are calculated and paid on a quarterly basis, and constitute a percentage of the
market values of the respective portfolios.

Item 9. Wholesale Generators and Foreign Utility Companies

Part I. Information with Respect to EWGs and FUCOs

Nova Scotia Power Inc. ("NSPI") is a fully integrated electrical utility with
its head office located at 1894 Barrington Street, Halifax, Nova Scotia. NSPI is
the primary supplier of electricity in the


<PAGE>

                                       14

Province of Nova Scotia and provides 97% of the generation, 99% of the
transmission, and 95% of the distribution of electricity in the Province. NSPI
owns 2,243 megawatts of generating capacity, 55% of which is coal fired. Oil and
natural gas account for an additional 27% of NSPI's generating capacity, and the
remaining generation capacity is attributable to NSPI's hydro and wind
operations. In addition, NSPI owns approximately 5,000 kilometers of
transmission facilities, and 25,000 kilometers of distribution facilities.

As of December 31, 2003, Emera had invested $830.6 million (Cdn.) or $642.7
million (U.S.) in the common stock equity of NSPI. On March 8, 1999, NSPI issued
5,000,000 First Preferred Share Units at a price of $6.25 per Unit. Each unit
consisted of one non-detachable cumulative, redeemable First Preferred Share,
Series B and a Warrant to purchase one cumulative, redeemable First Preferred
Share, Series C for cash consideration of $18.75. On October 1, 2000, unit
holders exercised 4,417,116 Series C purchase warrants and Series B First
Preferred Shares, and converted them to Series C First Preferred Shares.
Virtually all of the remaining Series C purchase warrants and Series B First
Preferred Shares were exercised on either January 1 or April 1, 2001 with a cash
payment of $18.75. The remaining 1,305 Series B First Preferred Shares, which
had not been converted to Series C, were cancelled in the second quarter of 2002
and each shareholder received their original investment.

Each Series C First Preferred Share is entitled to a $1.225 per share per annum
fixed cumulative preferential dividend, as and when declared by the Board of
Directors, accruing from the date of issue and payable quarterly on the first
day of January, April, July and September of each year. On or after April 1,
2009, NSPI may redeem for cash the Series C First Preferred Shares, in whole at
any time or in part from time to time at $25.00 per share plus accrued and
unpaid dividends. The Series C First Preferred Shares will be exchangeable into
Emera Inc. common shares on April 1, 2009.

On October 31, 2000, NSPI issued 5,400,000 Series D First Preferred Shares for a
price of $25 per share. Each share is entitled to a fixed cumulative cash
dividend of $1.475 per share per annum, as and when declared by the Board of
Directors. These dividends will accrue from the date of issue and will be
payable quarterly on the fifteenth day of January, April, July, and October of
each year. On or after October 15, 2015, NSPI may redeem for cash the Series D
First Preferred Shares, in whole at any time, at $25 per share plus accrued and
unpaid dividends. The Series D First Preferred Shares will be exchangeable into
Emera Inc. common shares on October 15, 2015.

During 2003, no assets were transferred to NSPI by a system company.

No Emera system company holds an interest in NSPI other than the common shares
held by Emera. NSPI's capital structure, and its ratio of debt to common equity,
is articulated in the following table.

                NSPI's Capital Structure as at December 31, 2003

<TABLE>
<CAPTION>
- ------------------------- ---------------------- ----------------------- ---------------------- ----------------------
                             Type of Capital        CDN $ (millions)        US $ (millions)      Percentage of Total
                                                                                                   Capitalization
- ------------------------- ---------------------- ----------------------- ---------------------- ----------------------
<S>                      <C>                     <C>                    <C>                    <C>
Nova Scotia Power Inc.    Common Stock                          1,098.8                  850.2                  39.5%
- ------------------------- ---------------------- ----------------------- ---------------------- ----------------------
                          Preferred Stock                         260.0                  201.2                   9.3%
- ------------------------- ---------------------- ----------------------- ---------------------- ----------------------


<PAGE>

                                                                              15

- ------------------------- ---------------------- ----------------------- ---------------------- ----------------------
                          Long-term Debt                        1,416.0                1,095.6                  50.9%
- ------------------------- ---------------------- ----------------------- ---------------------- ----------------------
                          Short-term Debt                           7.1                    5.5                   0.3%
- ------------------------- ---------------------- ----------------------- ---------------------- ----------------------
                          Total                                 2,781.9                2,152.5                 100.0%
- ------------------------- ---------------------- ----------------------- ---------------------- ----------------------
</TABLE>

NSPI's net earnings for the year ended December 31, 2003 were CDN $112.1
million.

With respect to contracts between NSPI and other Emera system companies,
concerning goods and services, please refer to the disclosure articulated in
response to Item 8, Part I.

Part II. Organizational Chart

A copy of Emera's organizational chart is attached as Exhibit G.

Part III. Aggregate Investment in EWGs and FUCOs

Response: Emera's aggregate investment in Nova Scotia Power Inc., its FUCO
subsidiary as defined in Rule 53, was $830.6 million (Cdn.) or $642.7 million
(U.S.) as of the end of the reporting period. Emera's aggregate investment in
Bangor Hydro-Electric Company equates to $202.2 million (US), and the ratio of
Emera's aggregate investment in NSPI to the aggregate capital invested in Bangor
Hydro-Electric Co. equates to 3.18.

Item 10. Financial Statements and Exhibits

                              FINANCIAL STATEMENTS

Emera's consolidated financial statements for the year ended and as of December
31, 2003 are incorporated by reference to Exhibit A of Emera's Form 35-Cert (SEC
File No. 70-9787) filed on February 27, 2004. BHE's consolidated financial
statements for the year ended and as of December 31, 2003 are incorporated by
reference to Exhibit B of Emera's Form 35-Cert (SEC File No. 70-9787) filed on
February 27, 2004. Emera's project to prepare consolidating financial statements
as required by this form and notes that would reconcile material differences
between Emera's financial statements maintained under Canadian GAAP and US GAAP
is ongoing. Once this project is completed, Emera will file an amendment to its
Annual Report on Form U5S to provide such information.


<PAGE>

                                                                              16

                                    EXHIBITS

Exhibit A

Not Applicable.

Exhibit B

The organizational documents for Emera, BHE, Chester SVC, and Bangor Var are
incorporated by reference to Exhibits A-1 through A-7 of the Application on Form
U-1/A filed by Emera on May 5, 2001 in SEC File No. 070-09787.

The organizational documents of Emera Energy Incorporated, including its
Memorandum of Association, Articles of Association and a Certificate of Name
Change documenting 3054167 Nova Scotia Limited's name change to Emera Energy
Incorporated were filed as Exhibits B-1, B-2, and B-3, respectively, to Emera's
Annual Report on Form U5S for 2002 and are incorporated by reference. These
exhibits constitute a representative sample of the organizational documents for
Emera's Canadian subsidiaries and are based on the standard Articles of
Incorporation for companies organized in Nova Scotia, which are then tailored to
Emera's standards.

Exhibit C

Emera's Trust Indenture, dated April 17, 2001, was attached as Exhibit C to
Emera's Report on Form U5S for 2002 and is incorporated by reference. There have
been no amendments to this Indenture during 2003 nor has Emera executed any
additional indentures during 2003.

The instruments defining the rights of the security holders of BHE are
incorporated herein by reference to BHE's Annual Report on Form 10-K for the
year ended December 31, 2002, Exhibit 4, SEC File No. 001-10922 (Filed March 28,
2003). There have been no amendments to such instruments during 2003.

Exhibit D

A copy of the tax allocation agreement is incorporated herein by reference to
Exhibit M-1 to Post-effective Amendment No. 2 to Emera's Application on Form
U-1, filed on April 10, 2003 in SEC File No. 070-09787.

Exhibit E

Exhibit E sets forth the additional information required to be provided in
Emera's Annual Report on Form U5S by Commission order dated October 1, 2001
(Holding Co. Act Release No. 27455).

Exhibit F

The Interm Order and Final Order of the Maine Public Utilities Commission
concerning Bangor Hydro-Electric Company's line construction project, pursuant
to reporting requirement number 2, are provided as Exhibit F hereto.


<PAGE>

                                                                              17

Exhibit G

The organizational chart required by Part II of Item 9 of Form U5S is provided
as Exhibit G hereto, filed under cover of Form SE.

Exhibit H

Nova Scotia Power Inc.'s financial statements as of and for the year ended
December 31, 2003 and 2002 and its Management Discussion and Analysis is
provided as Exhibit H hereto.


<PAGE>

                                                                              18

                                    SIGNATURE


     Each undersigned system company has duly caused this annual report to be
signed on its behalf by the undersigned thereunto duly authorized pursuant to
the requirements of the Public Utility Holding Company Act of 1935. The
signature of each undersigned company shall be deemed to relate only to matters
having reference to such company or its subsidiaries.

Emera Inc.                                  Emera US Holdings, Inc.
                                            BHE Holdings, Inc.

By: /s/ Richard J. Smith                    By: /s/ Richard J. Smith

Name:  Richard J. Smith                     Name: Richard J. Smith
Title: Corporate Secretary and General      Title: Assistant Corporate Secretary
Counsel
Date:  May 4, 2004
                                            Date:  May 4, 2004

</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-99.1
<SEQUENCE>2
<FILENAME>ex99-1.txt
<DESCRIPTION>EXHIBIT E
<TEXT>
                Exhibit E to Emera Inc. Annual Report on Form U5S
                      for the year ended December 31, 2003

Exhibit E:

1.   The amount of any income tax credit and/or income tax liability incurred
     during the previous fiscal year by Emera (one of the Intermediate
     Companies): (i) as a result of any Merger-related debt, and (ii) as a
     result of any other income source or expense.

Response: The amount of income tax credit incurred (in the Intermediate Holding
Companies) during the 2003 fiscal year as a result of Merger-related debt is
approximately $3,400,000 US. The amount of income tax credit incurred as a
result of other Intermediate Holding Company expenses is estimated to be
$306,000 US.

2.   A description of how the income tax credit and/or income tax liability was
     calculated and allocated to all companies included in the consolidated tax
     return, showing all of Emera's interest costs and any assumptions used in
     the calculation.

Response: The respective income tax credits noted above were calculated at an
effective income tax rate of 40% of the related expenses. The related expenses
were, respectively, $8,500,000 US of interest and $765,000 US of other expenses.
The income tax credits were realized by the Intermediate Holding Companies on a
quarterly basis in conjunction with payment by Bangor Hydro-Electric Company of
its estimated tax payments. The income tax credits are allocated to all
companies included in the consolidated tax filing in accordance with the manner
prescribed by the Tax Allocation Agreement.

3.   A description of how any Merger-related debt flows through all Intermediate
     Holding Companies.

Response: When Bangor Hydro-Electric Company declares and pays a dividend on
common shares to its parent, BHE Holdings Inc., the cash is transferred from
Bangor Hydro-Electric Company to BHE Holdings Inc. The parent of BHE Holdings
Inc., Emera US Holdings Inc., holds both common share and preferred share
investments in BHE Holdings Inc. BHE Holdings Inc. then declares and pays a
dividend from BHE Holdings Inc. to Emera US Holdings Inc. with respect to the
outstanding preferred shares of BHE Holdings Inc. Emera US Holdings Inc. then
uses the funds from the preferred dividends to pay Emera Inc. accrued financing
costs (interest) with respect to the Merger-related debt. The payment of the
Merger-related financing costs flows from the Intermediate Holding Companies to
Emera Inc. via several Canadian entities that are "disregarded entities" for US
income tax purposes. Payments to Emera Inc. with respect to the financing costs
are generally subject to 10% US withholding tax; a cost borne by Emera Inc.


<PAGE>


4.   A description of the amount and character of any payments made by each
     Intermediate Holding Company to any other Emera System company during the
     reporting period.

Response: Other than noted here, there were no payments made by either
Intermediate Holding Company to any other Emera System company during the
reporting period.

5.   A statement that the allocation of tax credits and liabilities was
     conducted in accordance with the Tax Allocation Agreement in effect and
     incorporated by reference to the Form U5S.

Response: The income tax credits incurred during the 2003 fiscal year have been
allocated in accordance with the Tax Allocation Agreement. The tax return for
2003 will not be filed until September 2004 at which time minor adjustments to
the allocation may be required to adjust the income tax credits to those
reflected on the tax return.


</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-99.2
<SEQUENCE>3
<FILENAME>ex99-2.txt
<DESCRIPTION>EXHIBIT F-1
<TEXT>
                                 STATE OF MAINE
                          PUBLIC UTILITIES COMMISSION

BANGOR HYDRO-ELECTRIC COMPANY
Re: Request to Construct Transmission Line of
100 or More Kilovolts Between the Chester               FINAL
Substation and the East Millinocket Substation          STIPULATION


Docket No. 2002-343

- --------------------------------------------------------------------------

     Bangor Hydro-Electric Company (BHE), the Office of the Public Advocate
(OPA), Paper, Allied-Industrial, Chemical and Energy Workers International Union
AFL-CIO, CLC ("PACE"), Industrial Energy Consumer Group (IECG), Georgia-Pacific
Corporation (GP), Central Maine Power Company (CMP), and Maine Public Service
Company (MPS) (collectively the "Parties"), hereby agree and stipulate as
follows:

I.   PURPOSE

     The purpose of this Stipulation is to settle all issues in this proceeding,
to avoid a hearing on those issues raised in this case and to expedite the
Public Utilities Commission=s consideration and resolution of the proceeding.
The provisions agreed to herein have been reached as a result of information
gathered through discovery and discussions among the parties in this case.

II.  PROCEDURAL BACKGROUND

     On August 1, 2002, BHE formally requested, pursuant to 35-A M.R.S.A.
ss.3132, a Certificate of Public Convenience and Necessity (CPCN) to construct a
115 kV transmission line between a new substation in Chester and a new
substation near East Millinocket (the "Proposed Line"). By Procedural Order
dated August 21, 2002, petitions to intervene of OPA, GP, IECG, CMP and MPS were
granted.


<PAGE>


     On October 30, 2002, the Commission issued an Interim Order and Order
Approving Stipulation authorizing BHE to commence construction of the Proposed
Line pending a final decision on whether to issue a CPCN. The Interim Order
allowed BHE to proceed with construction of the Proposed Line while the ISO-NE
System Impact Study (SIS) and related NEPOOL 18.4 approval for the Proposed Line
were being processed. The Interim Order established a spending cap of $4.5
million. Further, in the event a final CPCN was not issued, the Interim Order
restricted the ability of BHE to recover the costs of the Proposed Line from
ratepayers other than the customer who requested the transmission service from
BHE. Construction of the Proposed Line commenced shortly after the Interim
Order.

     On January 29, 2003 ISO-NE issued its 18.4 approval. After the issuance of
the 18.4 approval, some of the parties to this proceeding indicated that they
continued to have reservations about whether the Commission should issue the
final CPCN for the Proposed Line. Specifically, concerns were raised regarding
whether the Proposed Line met the statutory criteria for issuance of the CPCN.
These concerns included the alleged possibility that the Proposed Line would
have effects that would lead to higher rates for BHE customers.

     In addition, on February 25, 2003, Intervenor PACE, including its Locals
12, 24, 37, and 152, moved to intervene in these proceedings, pursuant to 35-A
M.R.S.A. ss. 1303 and Chapter 110 of the Commission's Rules of Practice and
Procedure. The basis of the intervention was PACE's position that BHE seeks an
order from the Commission for a CPCN for the Proposed Line and that the issuance
of a CPCN should be based upon an assessment of the totality of the
circumstances and impacts which construction of a transmission line may have in
both the immediate area, and in the State of Maine. It is the position of PACE
that among the issues to be considered in this proceeding are the effect the


                                       2

<PAGE>


Proposed Line will have on the viability of the Great Northern Paper ("GNP")
mills and the consequences to the ratepayers of BHE if the mills do not reopen.

     BHE sought a Second Interim Order to allow construction to continue while
the Parties continued to negotiate a Final Stipulation. On March 7, 2003, the
Commission issued an Order Approving Second Stipulation and Second Interim Order
authorizing BHE to continue construction of the Proposed Line until April 30,
2003, subject to a spending cap of $10 million. A hearing was initially
scheduled for March 25, 2003, and was subsequently rescheduled to March 28, 2003
and now April 8, 2003.

     On March 31, 2003, Brascan Inc. and GNP executed an Asset Purchase
Agreement for the acquisition by Brascan Inc. of GNP's paper mills in the
Millinocket Region. Fraser Paper ("Fraser"), the expected operator of the paper
mills, is sending a letter to PACE stating its plans for the operation of the
former GNP mills. Based upon Fraser's statements, PACE now deems the issuance of
the CPCN to be a positive factor in maintaining the viability of the paper mills
and in supporting economic health and growth in the Katahdin Region.

III. APPROVALS AND FINDINGS BY COMMISSION

     Based upon the record in this case, the parties to this Final Stipulation
agree and recommend that the Commission conclude this proceeding by issuing an
order which approves, accepts and adopts this Final Stipulation, including the
following provisions:

     1. Issuance of CPCN. The Commission shall issue a Certificate of Public
Convenience and Necessity for the construction of the Proposed Line, subject to
the conditions set forth herein.

     2. Costs of Proposed Line. Brascan Energy Marketing, Inc. ("BEMI") shall
pay BHE the costs of constructing the Proposed Line over a fifteen (15) year
period by making payments to BHE


                                       3

<PAGE>


pursuant to a FERC tariff in accordance with a November 1, 2000 settlement
agreement reached in a FERC proceeding (Docket No. ER00-980-000) (the "FERC
Tariff"). In addition to covering the cost of constructing the Proposed Line,
the payments under the FERC Tariff are expected to compensate BHE for BHE's
incremental costs to operate and maintain the Proposed Line for the next fifteen
(15) years. BEMI's obligations will be secured by a letter of credit to be
issued by the Canadian Imperial Bank of Commerce, Trade Finance Center, The
Atrium-on-Bay, 595 Bay Street, Toronto, Ontario M5G 2M8. The failure of BEMI to
make any required payment under the FERC Tariff will allow BHE to draw upon the
letter of credit to recover any outstanding BHE costs.

     3. Targeted Rate Contract for Georgia-Pacific. The Commission shall approve
the Targeted Rate Contract (attached as Exhibit "A") for delivery service by BHE
to GP's Old Town facility (owned and operated by GP's subsidiary Fort James
Operating Company). The Contract shall be based on the following factors. First,
BHE shall charge GP a monthly charge of $2,000. Second, GP shall pay for
transmission service at the prevailing FERC tariff. Third, GP shall pay for
distribution service at the D-4 rate for each facility including a monthly
demand charge based upon peak load assuming GP's generators are operating.
Finally, the distribution rate shall also include an additional standby demand
charge in the event GP's actual monthly peak load served by BHE is increased
because the GP generators are not operating. This Contract shall be effective
for five (5) years beginning January 1, 2004 and shall be extended automatically
for subsequent five (5) year terms, subject to approval by the Commission, and
also be subject to the right of the parties to terminate the Contract upon
mutual consent. In order to provide service to GP at just and reasonable rates,
BHE should modify GP's rates as of January 1, 2004 in accordance with the
attached Contract and any


                                       4

<PAGE>


impact on BHE revenue resulting from this Targeted Rate Contract shall be fully
reflected in rates to other BHE ratepayers in accordance with prevailing
ratemaking policy.

IV.  PROCEDURAL STIPULATIONS

     1. Staff Presentation of Stipulation. The parties to the Stipulation hereby
waive any rights that they have under 5 M.R.S.A. '9062(4) and Section 742 of the
Commission Rules of Practice and Procedure to the extent necessary to permit the
Advisory Staff to discuss this Stipulation and the resolution of the issues
addressed in this Stipulation with the Commissioners at the Commission=s
scheduled deliberations, without providing to the parties an Examiners Report or
the opportunity to file Exceptions.

     2. Record. The record on which the parties enter into this Stipulation and
on which the Commission may base its determination whether to accept and approve
this Stipulation shall consist of (a) this Stipulation; (b) all documents and
information provided in responses to written or oral data requests; and (c) the
transcripts of any Technical Conferences and any other material furnished by the
Advisory Staff to the Commission, either orally or in writing, to assist the
Commission in deciding whether to accept and approve this Stipulation.

     3. Non-Precedential Effect. This Stipulation shall not be considered legal
precedent, nor shall it preclude a party from making any contention or
exercising any rights, including the right of appeal, in any future Commission
investigation or proceeding or any other trial or action.

     4. Stipulation as Integrated Document. This Stipulation represents the full
agreement between the parties to the Stipulation and rejection of any part of
this Stipulation constitutes a rejection of the whole. 6


                                       5

<PAGE>


     5. Incorporation of Attachments: All attachments referred to in this
Stipulation are incorporated herein by reference and are intended to be
considered as part of this Stipulation as if their terms were fully set forth in
the body of this Stipulation.

     6. Void if Rejected. If not accepted by the Commission in accordance with
the provisions hereof, this Stipulation shall be void and of no further effect
and shall not prejudice any position taken by any party before the Commission in
this proceeding and shall not be admissible evidence therein or in any other
proceeding before the Commission.

     Respectfully submitted this 3rd day of April, 2003.

                      Office of the Public Advocate


                      By: _______________________________________

                          Paper, Allied-Industrial, Chemical and Energy Workers
                          International Union AFL-CIO, CLC

                      By: ________________________________________

                          Industrial Energy Consumer Group

                      By: ________________________________________

                          Georgia-Pacific Corporation

                      By: ________________________________________

                          Central Maine Power Company

                      By: ________________________________________


                                     6


<PAGE>


                          Maine Public Service Company

                      By: ________________________________________

                          Bangor Hydro-Electric Company

                      By: ________________________________________







P:\sanderson\bhe\115\P U C\Final Stipulation 4-2-03.doc



                                       7

</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-99.3
<SEQUENCE>4
<FILENAME>ex99-3.txt
<DESCRIPTION>EXHIBIT F-2
<TEXT>
STATE OF MAINE                                  Docket No. 2002-343
PUBLIC UTILITIES COMMISSION

                                                April 23, 2003

BANGOR HYDRO-ELECTRIC COMPANY                   ORDER
Request to Construct Transmission Line of
100 or More Kilovolts Between the Chester
Substation and the East Millinocket Substation

               WELCH, Chairman; NUGENT and DIAMOND, Commissioners
- --------------------------------------------------------------------------------

I.   SUMMARY

     By this Order, we approve a stipulation and issue a certificate of public
convenience and necessity authorizing Bangor Hydro-Electric Company (BHE) to
complete construction and operate a 115 kV transmission line between the Chester
Substation and the East Millinocket Substation. As part of the stipulation, we
also approve a special rate contract between BHE and Fort James Operating
Company, a subsidiary of Georgia-Pacific Corporation.

II.  BACKGROUND

     On August 1, 2002, BHE requested that the Commission grant a certificate of
public convenience and necessity pursuant to 35-A M.R.S.A. ss. 3132 for BHE to
construct a 115 kV transmission line between a new substation in Chester, Maine
and a new substation near East Millinocket, Maine.

     BHE stated that the new line was requested by Brascan Energy Marketing,
Inc. (Brascan). Brascan made the request pursuant to BHE's Federal Energy
Regulatory Commission (FERC) jurisdictional Open Access Tansmission Tariff
(OATT). Pursuant to this tariff, BHE is obligated to construct the line to
provide the requested service. By the terms of the BHE OATT, however, the
customer making the request is required to bear the incremental cost of
constructing the facilities necessary to provide service, including system
upgrades needed to integrate the line into BHE's system.

     Brascan made the request for the line as agent of Great Northern Energy
(GNE), a generator, and Great Northern Paper (GNP), a generator and electricity
consumer. GNE and GNP desire greater access to the New England power grid than
provided by the existing tie-line to the GNE and GNP facilities. The existing
line provides for 20 MW to be transmitted to the New England grid. The proposed
line will be operated so that 126 MW can be transmitted.

     BHE proposed H-frame construction for the line. The total length of the
line will be 17.5 miles and the line will follow the existing 46 kV line for the
majority of the route. The new line will be part of a larger project that will
include a new substation in East


<PAGE>


Order                                  2                Docket No. 2002-343
- ---------------------------------------------------------------------------


Millinocket that will serve a new, customer-owned 115 kV line from East
Millinocket to Millinocket being constructed by GNE.

     Petitions to intervene were granted on behalf of the Office of the Public
Advocate (OPA), the Industrial Energy Consumer Group (IECG), Georgia-Pacific
Corporation (GP), Central Maine Power Company (CMP) and Maine Public Service
Company (MPS). Extensive discovery, technical conferences and case conferences
have taken place since September 2002.

     On October 30, 2002, we issued an Interim Order and Order Approving
Stipulation in this docket. By the October 30 Order, we approved the Stipulation
that allowed BHE to begin construction of the proposed transmission line pending
a final decision by the Commission, up to a spending cap of $4.5 million. In
order for the line to be operational by summer 2003, BHE needed to complete
certain construction before the ground froze last fall and to complete other
construction d uring the winter 2002- 2003. The final decision in this
certification case could not be reached by the time of the October 30 order
because the ISO-NE System Impact Study (SIS) and related NEPOOL Section 18.4
approval process for the proposed line were not complete and were not expected
before the end of the calendar year. The parties entered into the Stipulation to
permit BHE to begin construction without a certificate, at BHE's shareholder's
risk, and still meet BHE's and Brascan's goal of placing the line in service by
summer 2003, assuming the Commission ultimately issued the certificate./1
Because the Stipulation protected ratepayers from BHE's construction costs,
caused no prejudice to the Commission or parties in deciding the certificate
issues, and the spending cap prevented Emera, BHE's shareholder, from suffering
any negative consequences to its financial integrity that indirectly would have
been passed on to BHE ratepayers, we found the Stipulation to be reasonable.

     On January 29, 2003, ISO-NE issued its so-called 18.4 approval. At a
subsequent case conference, the IECG stated that its members had concerns
regarding conditions attached to the 18.4 approval and concerns about the level
of BHE's rates that might result because of the 18.4 conditions and because the
transmission line would adversely affect the viability of the Great Northern
paper mills in Millinocket and East Millinocket. The IECG asserted that the
transmission line might fail to satisfy the public interest requirement for a
certificate because of the higher rates. The union representing workers at the
Great Northern paper mills, Paper, Allied-Industrial, Chemical and Energy
Workers International Union AFL-CIO, CLC (PACE), filed a late petition to
intervene, which was granted without objection. PACE also opposed the
certificate because of the negative effect it alleged that the transmission line
would have on the Great Northern paper mills. Accordingly, the Examiner
established a hearing schedule so that the IECG, PACE and BHE could present
witnesses.

- --------------
     1 Industrial Energy Consumer Group and Georgia-Pacific did not join the
Stipulation, but did not oppose it.


<PAGE>


Order                                  3                Docket No. 2002-343
- ---------------------------------------------------------------------------


     BHE stated that it expected to reach the spending cap before hearings were
scheduled. Consequently, the parties filed a Second Stipulation that allowed BHE
to continue construction until April 30, without a spending cap, in order to
accommodate the new litigation schedule while otherwise maintaining the status
quo created by the October 30 Order./2

     By an order issued on March 7, 2003, we approved the Second Stipulation for
the same reasons discussed in the October 30 Order. We conditioned our approval
on BHE's accepting a $10 million spending cap on its construction activities, or
$1 million more than its total expected costs. BHE and other parties consented
to our condition.

     On March 31, 2003, Brascan and Great Northern Paper executed an Asset
Purchase Agreement for the acquisition by Brascan of Great Northern's paper
mills in Millinocket and East Millinocket. Fraser Paper, the expected operator
of the paper mills, communicated with PACE about Fraser's plans for the
operation of the mills. At a subsequent case conference, and based upon Fraser's
statements, PACE changed its position to support issuance of the certificate.

     Shortly before hearings were to be held, the parties filed a Final
Stipulation. All parties joined the Stipulation except CMP, which does not
oppose it. The parties agree that the Commission should grant the certificate of
public convenience and necessity for the proposed transmission line, subject to
two conditions. The first condition relates to the obligation of Brascan Energy
Marketing, Inc. (BEMI) to reimburse BHE for BHE's costs of building the line and
for BHE's incremental costs to operate and maintain the line for the next 15
years. This obligation is now part of a FERC tariff. BEMI has secured its
obligations to pay pursuant to the FERC tariff, by providing a letter of credit
to BHE.

     The second condition requires the Commission to approve a special rate
contract for delivery service by BHE to Georgia-Pacific's Old Town facility,
owned and operated by Georgia-Pacific's subsidiary Fort James Operating Company.
Fort James operates two mills at the Old Town site, a tissue mill and a pulp
mill. The tissue mill operates at a peak load of approximately 11 MW, with
self-generation of 9.5 MW from a recently installed combustion turbine. The pulp
mill operates at a peak load of approximately 15 MW, with hydro and steam
turbine self-generation of up to 17 MW.

     The proposed contract will be effective on January 1, 2004, when the
current contract expires. The term of the contract is for five years, although
the term is automatically extended for subsequent five-year terms, subject to
Commission approval at each five-year increment. In addition, as provided in the
contract, the Commission must find BHE to be prudent in entering into the
special contract. Ratemaking associated with the special contract, however, will
be done in the already established

- --------------
     2 The IECG and Georgia-Pacific again did not join the Stipulation but did
not oppose it.


<PAGE>


Order                                  4                Docket No. 2002-343
- ---------------------------------------------------------------------------


process for distribution and stranded cost rates. The proposed contract provides
that Georgia-Pacific will pay:

     1.   a monthly charge of $2,000,
     2.   the prevailing FERC tariff for transmission service,
     3.   the D-4 tariff rate for distribution service for each facility,
          including a monthly demand charge and any applicable ratchet, based
          upon the peak load set during non-standby days, and
     4.   a standby demand charge based on the peak demand on standby days less
          the peak demand on non-standby days. The standby demand charge will be
          the D-4 demand charge prorated for the actual days that standby
          service is delivered in a month (For example, if there are two standby
          days in a 30-day month, the standby demand charge will be 1/15 of a
          normal monthly demand charge).

     After the Final Stipulation was filed, Georgia-Pacific announced that it
was closing the tissue mill. The closing was described as "permanent" and some
equipment has been removed and shipped to other mills.

     At a hearing on the Final Stipulation, BHE stated that a special contract
was justified for Georgia-Pacific. The closing of the tissue mill serves to
confirm the need for, and to heighten the urgency of, a discounted arrangement
for the remaining Old Town facilities. Indeed, the Fort James officials stated
that Georgia-Pacific needs to be convinced within weeks that the pulp mill is
financially viable. Moreover, the closing of the tissue mill reduces the
significance of the discount that Georgia-Pacific will receive from the new
special contract. BHE estimates the lost revenue from the new contract, relative
to what BHE would otherwise receive in light of the closing of the tissue mill,
at $30,000/year. BHE also stated that it expected the new contract will not be
sufficient given the new, smaller operation in Old Town and that BHE expects
that it will have to negotiate a larger discount to keep the pulp mill open.

     At the hearing, the parties also were asked to describe the nexus between
the certificate request and the special rate contract for an Intervenor in the
certificate proceeding. BHE and Georgia-Pacific stated that throughout the
proceeding, Georgia- Pacific was concerned about the effect that the proposed
transmission line might have on rates. In their view, the special rate contract
removes Georgia-Pacific's concerns about future rates and permits
Georgia-Pacific to support the granting of the certificate.

III. DECISION

     To approve a stipulation the Commission must find that:

     1.   the parties joining the Stipulation represent a sufficiently broad
          spectrum of interests that the Commission can be sure that there is no
          appearance or reality of disenfranchisement;


<PAGE>


Order                                  5                Docket No. 2002-343
- ---------------------------------------------------------------------------


     2.   the process that led to the Stipulation was fair to all parties; and

     3.   the stipulated result is reasonable and not contrary to legislative
          mandate.

See Central Maine Power Company, Proposed Increase in Rates, Docket No. 92-
345(II), Detailed Opinion and Subsidiary Findings (Me. P.U.C. Jan. 10, 1995),
and Maine Public Service Company, Proposed Increase in Rates (Rate Design),
Docket No. 95-052, Order (Me. P.U.C. June 26, 1996).

     We have also recognized that we have an obligation to ensure that the
overall stipulated result is in the public interest. See Northern Utilities,
Inc., Proposed Environmental Response Cost Recovery, Docket No. 96-678, Order
Approving Stipulation (Me. P.U.C. April 28, 1997). We find that the Final
Stipulation in this case meets all of the above criteria.

     In this case, the Stipulation is signed by BHE, CMP, MPS, the OPA, the
IECG, and Georgia-Pacific. CMP, the only other intervenor, does not oppose the
Stipulation. When all parties in a properly-noticed adjucatory proceeding either
join or do not oppose a stipulation, we generally find, and in this case we do
find, that the stipulating parties represent a sufficiently broad spectrum of
interests to ensure that there is no appearance or reality of
disenfranchisement.

     There is no allegation that the process was unfair, as expected when all
parties either join or do not oppose the Stipulation. We note that the Examiner
held numerous technical, settlement and case management conferences. The
Examiner required the parties to file prehearing memoranda giving all parties
fair notice of the proposed witnesses and the overall positions of the parties
on the contested issues. We conclude the process leading to the Final
Stipulation was fair.

     Finally, we conclude that the stipulated result is reasonable and not
contrary to statute. The issuance of a certificate of public convenience and
necessity pursuant to 35-A M.R.S.A. ss. 3132 is warranted. The record supports a
finding, as required by section 3132(6), that a need exists for the proposed
line. The line will permit a generator to sell more electricity into the New
England grid. The FERC tariff and letter of credit arrangement, upon which the
Final Stipulation is conditioned, provide reasonable assurance that the general
body of BHE ratepayers will not pay higher rates as a result of constructing the
proposed transmission line. In the post-electric restructuring world, we have
found that similar facts justify a finding of need. Central Maine Power Company,
Docket No. 98-863 (March 12, 1999) (Order issuing CPCN for transmission line to
connect Rumford Power Associates generating facility).

     Likewise, we find that approval of the Georgia-Pacific special contract is
reasonable in the circumstances of this case and not contrary to statute.
Although we typically would not grant a finding of prudence without additional
review, in this instance, we do for two reasons. First, because of the
subsequent closing of the tissue mill, the amount of the discount has been
diminished. While we find that BHE's estimate of


<PAGE>


Order                                  6                Docket No. 2002-343
- ---------------------------------------------------------------------------


$30,000 for the revenue loss is probably low (BHE averaged the peak and shoulder
demand charges, rather than adding them, and assumed no ratchet would apply,
absent the contract), we do not expect the revenue loss from this contract to be
significant relative to the revenue loss associated with losing the tissue mill
load, nor to result in a significant adverse impact on other customers.

     Second, the closure of the tissue mill supports the reasonableness of BHE's
judgment that a discount was necessary to keep Georgia-Pacific connected to the
grid and contributing to BHE's fixed costs. Indeed, the subsequent events at the
Old Town facilities suggest that it was necessary to deal with this matter
expeditiously and that it may have been more risky for BHE to fail to act rather
than fail to offer the special contract within the context of the Final
Stipulation.

     Therefore, analyzing the special contract on its own merit, separate from
the other stipulation provisions, we find it reasonable for BHE to offer the
proposed discount to Georgia-Pacific.

     Accordingly, we approve the Final Stipulation, issue a certificate for
public convenience and necessity to BHE to build the proposed transmission line,
approve the special contract between BHE and Georgia-Pacific, and find BHE
prudent for entering into the special contract.

             Dated at Augusta, Maine, this 23rd day of April, 2003.

                           BY ORDER OF THE COMMISSION

                        -------------------------------
                                Dennis L. Keschl
                            Administrative Director

COMMISSIONERS VOTING FOR:       Welch
                                Nugent
                                Diamond

               THIS DOCUMENT HAS BEEN DESIGNATED FOR PUBLICATION


<PAGE>


Order                                  7                Docket No. 2002-343
- ---------------------------------------------------------------------------


                      NOTICE OF RIGHTS TO REVIEW OR APPEAL

     5 M.R.S.A. ss. 9061 requires the Public Utilities Commission to give each
party to an adjudicatory proceeding written notice of the party's rights to
review or appeal of its decision made at the conclusion of the adjudicatory
proceeding. The methods of review or appeal of PUC decisions at the conclusion
of an adjudicatory proceeding are as follows:

     1. Reconsideration of the Commission's Order may be requested under Section
     1004 of the Commission's Rules of Practice and Procedure (65-407 C.M.R.110)
     within 20 days of the date of the Order by filing a petition with the
     Commission stating the grounds upon which reconsideration is sought.

     2. Appeal of a final decision of the Commission may be taken to the Law
     Court by filing, within 21 days of the date of the Order, a Notice of
     Appeal with the Administrative Director of the Commission, pursuant to 35-A
     M.R.S.A. ss. 1320(1)-(4) and the Maine Rules of Appellate Procedure.

     3. Additional court review of constitutional issues or issues involving the
     justness or reasonableness of rates may be had by the filing of an appeal
     with the Law Court, pursuant to 35-A M.R.S.A. ss. 1320(5).

     Note: The attachment of this Notice to a document does not indicate the
           Commission's view that the particular document may be subject to
           review or appeal. Similarly, the failure of the Commission to attach
           a copy of this Notice to a document does not indicate the
           Commission's view that the document is not subject to review or
           appeal.



</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-99.4
<SEQUENCE>5
<FILENAME>ex99-4.txt
<DESCRIPTION>EXHIBIT H
<TEXT>
Exhibit H




                             NOVA SCOTIA POWER INC.

                              Financial Statements

                           December 31, 2003 and 2002




<PAGE>

Exhibit H


                                MANAGEMENT REPORT

Management's Responsibility for Financial Reporting

The accompanying financial statements of Nova Scotia Power Inc. ("NSPI") and the
information in this annual report are the responsibility of management and have
been approved by the Board of Directors ("Board").

The financial statements have been prepared by management in accordance with
Canadian generally accepted accounting principles. When alternative accounting
methods exist, management has chosen those it deems most appropriate in the
circumstances. Nova Scotia Power Inc. is regulated by the Nova Scotia Utility
and Review Board, which also examines and approves NSPI's accounting policies
and practices. In preparation of these financial statements, estimates are
sometimes necessary when transactions affecting the current accounting period
cannot be finalized with certainty until future periods. Management believes
that such estimates, which have been properly reflected in the accompanying
financial statements, are based on careful judgements and are within reasonable
limits of materiality. Management has determined such amounts on a reasonable
basis in order to ensure that the financial statements are presented fairly in
all material respects. Management has prepared the financial information
presented elsewhere in the annual report and has ensured that it is consistent
with that in the financial statements.

Nova Scotia Power Inc. maintains effective systems of internal accounting and
administrative controls, consistent with reasonable cost. Such systems are
designed to provide reasonable assurance that the financial information is
relevant, reliable and accurate and that Nova Scotia Power Inc.'s assets are
appropriately accounted for and adequately safeguarded.

The Board is responsible for ensuring that management fulfils its
responsibilities for financial reporting and is ultimately responsible for
reviewing and approving the financial statements. The Board carries out this
responsibility principally through its Audit Committee.

The Audit Committee is appointed by the Board, and its members are directors who
are not officers or employees of Nova Scotia Power Inc. The Committee meets
periodically with management, as well as with the internal auditors and with the
external auditors, to discuss internal controls over the financial reporting
process, auditing matters and financial reporting issues, to satisfy itself that
each party is properly discharging its responsibilities, and to review the
annual report, the financial statements and the external auditors' report. The
Audit Committee reports its findings to the Board for consideration when
approving the financial statements for issuance to the shareholders. The
Committee also considers, for review by the Board and approval by the
shareholders, the appointment of the external auditors.

The financial statements have been audited by Grant Thornton LLP, the external
auditors, in accordance with Canadian generally accepted auditing standards.
Grant Thornton LLP has full and free access to the Audit Committee.

January 28, 2004

"David McD. Mann"
President and Chief Executive Officer



<PAGE>

Exhibit H


                                AUDITORS' REPORT

To the Shareholder of
Nova Scotia Power Inc.

We have audited the balance sheet of Nova Scotia Power Inc. as at December 31,
2003 and the statements of earnings, retained earnings and cash flow for the
year then ended. These financial statements are the responsibility of the
Company's management. Our responsibility is to express an opinion on these
financial statements based on our audit.

We conducted our audit in accordance with Canadian generally accepted auditing
standards. Those standards require that we plan and perform an audit to obtain
reasonable assurance whether the financial statements are free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements. An audit also includes
assessing the accounting principles used and significant estimates made by
management, as well as evaluating the overall financial statement presentation.

In our opinion, these financial statements present fairly, in all material
respects, the financial position of the Company as at December 31, 2003 and the
results of its operations and its cash flows for the year then ended in
accordance with Canadian generally accepted accounting principles.

The financial statements as at December 31, 2002 and for the year then ended
were audited by other auditors who expressed an opinion without reservation on
those statements in their report dated February 5, 2003.





Halifax, Canada
January 28, 2004


"Grant Thornton LLP"
Chartered Accountants




<PAGE>

Exhibit H


Nova Scotia Power Inc.
Statements of Earnings
Year Ended December 31
millions of dollars

                                                       2003              2002
Revenue
Electric                                             $895.6            $869.1
Other                                                   9.0               7.4
- -------------------------------------------------------------------------------
                                                      904.6             876.5
- -------------------------------------------------------------------------------
Cost of operations
Fuel for generation and power purchased               277.8             335.6
Operating, maintenance and general                    186.0             176.4
Grants in lieu of property taxes                       26.2              15.2
Provincial capital tax                                  7.2               6.8
Depreciation                                          101.7             103.9
- -------------------------------------------------------------------------------
                                                      598.9             637.9
- -------------------------------------------------------------------------------
Earnings from operations                              305.7             238.6
Amortization                                          (6.2)             (1.0)
Allowance for funds used during                         4.5               3.4
construction
- -------------------------------------------------------------------------------
Earnings before interest and income taxes             304.0             241.0
Interest (note 6)                                     104.3             109.6
Amortization of defeasance costs                       16.7              19.4
- -------------------------------------------------------------------------------
Earnings before income taxes                          183.0             112.0
Income taxes (note 7)                                  57.8              15.7
- -------------------------------------------------------------------------------
Net earnings before dividends                         125.2              96.3
Preferred share dividends (note 7)                     13.1              10.2
- -------------------------------------------------------------------------------
Net earnings applicable to common shares             $112.1             $86.1
- -------------------------------------------------------------------------------

See accompanying notes to the financial statements.



<PAGE>

Exhibit H


Nova Scotia Power Inc.
Statements of Retained Earnings
Year Ended December 31
millions of dollars

                                                    2003                 2002
Retained earnings, beginning of year              $226.1               $224.4
Net earnings applicable to common                  112.1                 86.1
shares
- -------------------------------------------------------------------------------
                                                   338.2                310.5
Dividends                                           70.0                 84.4
- -------------------------------------------------------------------------------
Retained earnings, end of year                    $268.2               $226.1
- -------------------------------------------------------------------------------

See accompanying notes to the financial statements.





<PAGE>

Exhibit H

Nova Scotia Power Inc.
Balance Sheets
As at December 31
millions of dollars
                                     ASSETS
                                                             2003         2002
- -------------------------------------------------------------------------------
Current assets
   Cash and cash equivalents                                    -        $13.3
   Accounts receivable (note 8)                             $88.0         88.5
   Due from associated companies (note 9)                    12.7          9.2
   Income taxes receivable                                      -         26.5
   Inventory                                                 83.8         99.3
   Prepaid expenses                                           5.1          5.7
- -------------------------------------------------------------------------------
                                                            189.6        242.5
- -------------------------------------------------------------------------------
Deferred charges (note 10)                                  399.0        256.3
- -------------------------------------------------------------------------------
Property, plant and equipment (note 11)                   2,335.4      2,328.7
Construction work in progress                                36.9         55.8
- -------------------------------------------------------------------------------
                                                          2,372.3      2,384.5
- -------------------------------------------------------------------------------
                                                         $2,960.9     $2,883.3
- -------------------------------------------------------------------------------

                      SHAREHOLDER'S EQUITY AND LIABILITIES

- -------------------------------------------------------------------------------
Current liabilities
   Current portion of long-term debt (note 12)             $140.0       $150.0
   Short-term debt (note 13)                                  7.1        122.1
   Accounts payable and accrued charges                     144.4        115.3
   Income taxes payable                                       1.6            -
   Dividends payable                                          3.2          3.2
- -------------------------------------------------------------------------------
                                                            296.3        390.6
- -------------------------------------------------------------------------------
Deferred credits (note 10)                                   29.8         33.1
- -------------------------------------------------------------------------------
Long-term debt (note 12)                                  1,276.0      1,146.0
- -------------------------------------------------------------------------------
Preferred shares (note 14)                                  260.0        260.0
- -------------------------------------------------------------------------------
Shareholder's equity
   Common shares (note 15)                                  830.6        827.5
   Retained earnings                                        268.2        226.1
- -------------------------------------------------------------------------------
                                                          1,098.8      1,053.6
- -------------------------------------------------------------------------------
                                                         $2,960.9     $2,883.3
- -------------------------------------------------------------------------------

Commitments (note 17)
Contingency (note 7)
Guarantees (note 18)

See accompanying notes to the financial statements.

APPROVED ON BEHALF OF THE BOARD OF DIRECTORS

"Derek Oland"                        "David McD. Mann"
Chairman                             President and Chief Executive Officer


<PAGE>

Exhibit H


Nova Scotia Power Inc.
Statements of Cash Flow
Year Ended December 31
millions of dollars

                                                      2003          2002
- -----------------------------------------------------------------------------
Operating activities
  Cash received from customers                            $932.6     $842.3
  Cash paid to suppliers and employees                   (468.7)    (484.4)
  Cash paid to preferred shareholders                     (14.1)     (14.1)
- -----------------------------------------------------------------------------
Cash provided by operations, before interest               449.8      343.8
and taxes                                                (100.4)    (113.2)
Interest paid                                             (37.0)     (12.3)
Income taxes paid                                        (133.0)          -
Pre-2003 income tax assessment
- -----------------------------------------------------------------------------
Net cash provided by operating activities                  179.4      218.3
- -----------------------------------------------------------------------------

Financing activities
  (Reduction) increase in short-term debt                (145.0)       13.8
  Issue of common shares                                       -       75.0
  Issue of long-term debt                                  300.0          -
  Retirement of long-term debt                           (150.0)    (120.0)
  Dividends paid on common shares                         (70.0)     (84.4)
 Other financing activities                               (31.0)        3.5
- -----------------------------------------------------------------------------
Net cash used in financing activities                     (96.0)    (112.1)
- -----------------------------------------------------------------------------

Investing activities
  Property, plant and equipment                           (94.0)    (128.8)
  Proceeds on the sale of fixed assets                       1.7       26.7
  Retirement spending                                      (4.4)      (2.5)
- -----------------------------------------------------------------------------
Net cash used in investing activities                     (96.7)    (104.6)
- -----------------------------------------------------------------------------

(Decrease) / increase in cash and cash                    (13.3)        1.6
equivalents
- -----------------------------------------------------------------------------

Cash and cash equivalents, beginning of year                13.3       11.7
- -----------------------------------------------------------------------------
Cash and cash equivalents, end of year                        $-      $13.3
- -----------------------------------------------------------------------------
Cash and cash equivalents consists of:
Cash                                                          $-       $0.1
Short-term investments                                         -       13.2
- -----------------------------------------------------------------------------
Cash and cash equivalents, end of year                        $-      $13.3
- -----------------------------------------------------------------------------


See accompanying notes to the financial statements.



<PAGE>

Exhibit H


Nova Scotia Power Inc.
Notes to the Financial Statements

December 31, 2003 and 2002

1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Nova Scotia Power Inc. ("NSPI", "Nova Scotia Power", or the "Company"),
incorporated in the Province of Nova Scotia, is engaged in the production and
sale of electric energy, and is regulated by the Nova Scotia Utility and Review
Board ("UARB"). NSPI's accounting policies are subject to examination and
approval by the UARB and are similar to those being used by other companies in
the electric utility industry. The rate-regulated accounting policies of NSPI
may differ from Canadian generally accepted accounting principles ("GAAP") for
non rate-regulated companies. Where these differences are considered
significant, disclosure of the policy has been made in these notes to the
financial statements.

     a.   Measurement Uncertainty

          The preparation of financial statements in accordance with generally
          accepted accounting principles requires management to make estimates
          and assumptions that affect the reported amounts of assets and
          liabilities at the date of the financial statements and the reported
          amounts of revenues and expenses during the reporting periods. Actual
          results may differ from these estimates.

     b.   Revenue Recognition

          The Company's revenue recognition policy is as follows:

          o    Electric: Revenues are recognized on the accrual basis, which
               includes an estimate of electricity consumed by customers in the
               year but billed subsequent to year-end.

          o    Other: Revenues are recognized on the accrual basis, which
               includes an estimate for services performed and goods delivered
               during the year but billed subsequent to year-end. Unearned
               revenue is recorded as a deferred credit.

     c.   Allowance for Funds Used During Construction

          NSPI provides for the cost of financing construction work in progress
          by including an allowance for funds used during construction ("AFUDC")
          as an addition to the cost of property constructed, using a weighted
          average cost-of-capital. This allowance will be charged to operations
          through depreciation over the service life of the related assets and
          recovered through future revenues.

     d.   Regulatory Amortization

          In accordance with regulations of the UARB, significant assets of
          NSPI, which are not currently being used and are not expected to
          provide


<PAGE>

Exhibit H


          service to customers in the foreseeable future are amortized over five
          years. In 2000 the UARB approved NSPI's request to amortize the Glace
          Bay generating station over five years. The UARB had allowed Nova
          Scotia Power flexibility in determining the annual amount to be
          written off in order to support rate stability. On July 28, 2003 the
          UARB approved the Company's request to extend the write-off period
          through 2008, if necessary, with an annual minimum amortization of
          $6.2 million.

     e.   Property, Plant and Equipment

          Property, plant and equipment are recorded at original cost net of
          contributions in aid of construction. When property, plant and
          equipment are replaced or retired, the original cost plus any removal
          costs incurred (net of salvage) are charged to accumulated
          depreciation.

          Depreciation is determined by the straight-line method, based on the
          estimated remaining service lives of the depreciable assets in each
          category. The estimated average service lives for the major categories
          of plant in service are summarized as follows:

          Functions                  Average Service Life
                                           in Years
          ---------------------------------------------------
          Generation
              Thermal                         43
              Gas turbine                     34
              Hydroelectric                   77
              Wind turbine                    20
          Transmission                        45
          Distribution                        31
          General plant                       15
          ---------------------------------------------------

          In accordance with regulatory authority, assets that are not currently
          being used but will be useful in providing future service to
          customers, are not depreciated. Financing costs associated with assets
          not currently being used are being deferred as incurred. Depreciation
          will occur when the asset goes into service. Significant costs in
          removing the asset from service may be deferred and amortized to
          earnings over a five-year period, subject to regulatory approval.
          Significant costs to return the asset to service are added to the
          capital cost of the asset.

     f.   Income Taxes and Investment Tax Credits

          In accordance with the ratemaking regulations established by the UARB,
          income taxes on earnings are determined using the taxes-payable method
          of accounting. Accordingly, NSPI does not provide for future income
          taxes.


<PAGE>

Exhibit H


          Investment tax credits arise as a result of incurring qualifying
          scientific research and development expenditures and are recorded in
          the year as a reduction from the related expenditures where there is
          reasonable assurance of collection.

     g.   Employee Future Benefits

          Pension costs, and costs associated with non-pension post-retirement
          benefits such as health benefits to retirees and retirement awards,
          are actuarially determined using the projected benefit method prorated
          on services and management's best estimate assumptions. Pension fund
          asset values are calculated using market values at year-end. The
          expected return on pension assets is determined based on
          market-related values. The market-related values are determined in a
          rational and systematic manner so as to recognize asset gains and
          losses over a five-year period. Adjustments arising from plan
          amendments are amortized on a straight-line basis over the expected
          average remaining service period ("ARSP") of active employees. For any
          given year, when NSPI's net actuarial gain (loss), less the actuarial
          gain (loss) not yet included in the market-related value of plan
          assets, exceeds 10% of the greater of the accrued benefit obligation
          and the market-related value of the plan assets, an amount equal to
          the excess divided by the ARSP is amortized. The difference between
          pension expense and pension funding is recorded as a deferred asset or
          credit on the balance sheet.

     h.   Cash and Cash Equivalents

          Short-term investments, which consists of money market instruments
          with maturities of three months or less at an effective interest rate
          of 2.83% for 2003 (2002 - 2.29%), are considered to be cash
          equivalents and are recorded at cost, which approximates current
          market value.

     i.   Inventory

          Inventories of materials and supplies are valued at the lower of
          average cost and market. Coal and oil inventory are valued at the
          lower of cost, using the first-in, first-out method, and net
          realizable value.

     j.   Debt Financing and Defeasance Costs

          Financing costs pertaining to debt issues are amortized over the life
          of the related debt. The excess of the cost of defeasance investments
          over the face value of the related debt is deferred and amortized over
          the life of the defeased debt.

     k.   Derivative Financial Instruments

          The Company uses various derivative financial instruments to hedge its
          exposure to foreign exchange, interest rate, and commodity price
          risks. These instruments are accounted for as hedges of anticipated


<PAGE>

Exhibit H


          transactions and, accordingly, gains and losses on these instruments
          are included in the measurement of the related hedged risk when
          realized.

     l.   Foreign Currency Translation

          Monetary assets and liabilities denominated in foreign currencies are
          converted to Canadian dollars at rates of exchange prevailing at the
          balance sheet date. The resulting differences between the translation
          at the original transaction date and the balance sheet date are
          charged to earnings.

     m.   Research & Development Costs

          All research and development costs are expensed in the year incurred
          unless they can be deferred as part of capital assets.

2.   CHANGE IN ACCOUNTING ESTIMATE

     Electric revenues are recognized on the accrual basis, which includes an
     estimate of electricity consumed by customers in the period but billed
     subsequent to the period. During the second quarter, the Company improved
     its process for estimating unbilled revenue and as a result, decreased its
     electric revenue by approximately $10 million. The impact on future periods
     is expected to be immaterial.

3.   CHANGE IN ACCOUNTING POLICIES

     In 2002 the Company adopted the new provisions for classification of
     short-term debt obligations expected to be refinanced. Under the new
     standard, debt obligations, which are short-term, should be reclassified as
     long-term if the Company has the intention and the unencumbered ability to
     refinance the obligations for a period greater than one year. This
     assessment is performed by taking into account both the actual level of
     short-term debt at the end of the fiscal year and the forecasted levels of
     debt for the period to the end of the next fiscal year. The new provisions
     became effective on January 1, 2002 and have been applied prospectively. As
     a result, as at December 31, 2002, the Company had reclassified $111.0
     million of debt from short-term to long-term.

     In 2002 NSPI changed its policy regarding employee future benefits to use
     market-related values instead of market values to calculate the expected
     return on its plan assets. The change entails recognizing changes in the
     actual fair value of the plan assets in a rational and systematic manner
     over a five-year period. The change has been applied retroactively but with
     no resulting material adjustments. The impact in 2002 of changing this
     policy was to reduce the expense by $5.8 million.

4.   ACQUISITIONS


<PAGE>

Exhibit H


     The acquisition described below has been accounted for under the purchase
     method of accounting, and accordingly the results of operations, which were
     nil, since the date of acquisition have been included in the statement of
     operations.

     During 2003 Nova Scotia Power acquired an affiliate company for share
     consideration of $3.1 million. The assets purchased consisted of an income
     tax receivable ($3.6 million) and a liability to ratepayers ($0.5 million).
     The company purchased was subsequently wound up.

5.   EMPLOYEE FUTURE BENEFITS
     millions of dollars

     NSPI maintains contributory defined-benefit and defined-contribution
     pension plans, which cover substantially all of its employees, and plans
     providing non-pension benefits for its retirees. The details of these plans
     are outlined below:
                                             2003                  2002
                                   Defined       Non-       Defined-  Non-
                                   benefit       pension    benefit   pension
                                   pension       benfits    pension   benefits
                                   plans         plans      plans     plans

     Assumptions
     Discount rate                     6.00%       6.00%      6.50%     6.50%
     Long-term rate of return on
     plan assets                       7.50%         -        7.50%       -
     Rate of compensation increase   3 to 5.5%   3 to 5.5%  3 to 5.5% 3 to 5.5%
     Health care trend - current         -         11.00%       -      10.00%
                                 -       -         4.00%        -       4.00%
     ultimate
     ---------------------------------------------------------------------------
     Accrued benefit obligations
     Balance January 1                    $549.8      $33.7    $514.4     $35.1
     Employer current service cost           8.6        1.2       7.8       1.3
     Employee contributions                  4.7          -       4.9         -
     Interest cost                          35.2        2.2      34.0       2.4
     Past service amendments                 6.1          -         -         -
     Actuarial loss (gain)                  48.3      (4.5)      21.5     (3.7)
     Benefits paid                        (28.7)      (1.4)    (32.8)     (1.4)
     ---------------------------------------------------------------------------
     Balance December 31                  $624.0      $31.2    $549.8     $33.7
     ---------------------------------------------------------------------------
     Fair value of plan assets
     Balance January 1                    $406.8          -    $459.0         -
     Employee contributions                  4.7          -       4.9         -
     Contributions by NSPI                  20.6       $1.4       8.9      $1.4
     Actual investment income               67.9          -    (33.2)         -
     Benefits paid                        (28.7)      (1.4)    (32.8)     (1.4)
     ---------------------------------------------------------------------------
     Balance December 31                  $471.3          -    $406.8         -
     ---------------------------------------------------------------------------
     Plan deficit                       ($152.7)    ($31.2)  ($143.0)   ($33.7)
     Unamortized past service costs          7.0          -       1.2         -
     Unamortized actuarial losses          196.8      (4.1)     181.1       0.4
     Unamortized transitional                0.2       20.1       0.2      22.4
     obligation
     ---------------------------------------------------------------------------
     Accrued benefit asset                 $51.3    ($15.2)     $39.5   ($10.9)
     (liability)
     ---------------------------------------------------------------------------


<PAGE>

Exhibit H


     ---------------------------------------------------------------------------
     Expense
     Current service cost                   $8.6       $1.2      $7.8      $1.3
     Interest on accrued benefits           35.2        2.2      34.0       2.4
     Less: expected return on plan        (37.8)          -    (36.4)         -
     assets
     Amortization of actuarial               2.5          -       0.5       0.1
     losses
     Amortization of transitional              -        2.3         -       2.2
     liability
     Amortization of past service            0.3          -       0.1         -
     costs
     ---------------------------------------------------------------------------
                                            $8.8       $5.7      $6.0      $6.0
     ---------------------------------------------------------------------------

     Defined-contribution pension
     plan
     Employer expense                       $0.7          -      $0.6         -
     ---------------------------------------------------------------------------


     The expected return on plan assets is determined based on the
     market-related value of plan assets of $506.2 million at January 1, 2003
     (January 1, 2002 - $495.5 million) adjusted for interest on certain cash
     flows during the year.

6.   INTEREST

     Interest expense consists of the following:

     millions of dollars
                                                            2003         2002
     -------------------------------------------------------------------------
     Interest on long-term debt                            $93.5        $93.8
     Interest on short-term debt                            13.9         15.1
     Amortization of debt financing                          1.1          0.9
     Foreign exchange (gains) losses                       (4.1)          0.1
     -------------------------------------------------------------------------
                                                           104.4        109.9
     Less:
       Defeasance earnings and other interest              (0.1)        (0.3)
     income
     -------------------------------------------------------------------------
                                                          $104.3       $109.6
     -------------------------------------------------------------------------

7.   INCOME TAXES millions of dollars

     The income tax provision differs from that computed using the statutory
     rates for the following reasons:

                                               2003               2002
     -------------------------------------------------------------------------
     Earnings before income taxes         $183.0              $112.0
     -------------------------------------------------------------------------
     Income taxes, at statutory rates      $73.4     40.1%     $47.2    42.1%
     Unrecorded future income taxes       (18.3)    (10.0)    (37.4)   (33.4)
     Manufacturing & Processing            (2.4)     (1.3)         -        -
     profits deduction
     Large Corporations Tax                  5.1       2.8       5.9    5.3
     -------------------------------------------------------------------------
     Income taxes                          $57.8   31.6%       $15.7   14.0%
     -------------------------------------------------------------------------

     NSPI filed income tax returns for previous years that increased the tax
     depreciation (capital cost allowance) available to be deducted against the
     Company's future taxable income. Those returns were reassessed by the


<PAGE>

Exhibit H


     Canada Customs and Revenue Agency (CCRA), which disallowed the deductions
     claimed. A notice of objection was filed with respect to the reassessments
     and the issue was litigated. In January 2002 the Company received a
     favourable decision from the Tax Court of Canada with respect to CCRA's
     reassessment of its corporate income tax returns. CCRA appealed the
     decision to the Federal Court of Appeal which, in January 2003, overturned
     the Tax Court ruling. In November 2003, NSPI was granted leave to appeal
     the Federal Court decision to the Supreme Court of Canada. It is expected
     that the Appeal will be heard by the Supreme Court in 2004.

     As a result of the Federal Court's decision, NSPI is now recognizing a
     provision for income taxes. Without the benefit of this additional
     deduction, it is estimated that the Company's tax liability at December 31,
     2002, would have been approximately $118 million ($149 million including
     interest). The Company has reduced its previous estimate of $157 million
     including interest as a result of reductions in previous years' taxable
     income as a result of CCRA reassessments. In February 2003 the UARB
     provided an accounting order providing for deferral of any pre-2003 income
     tax liability together with any related interest until the matter is
     resolved.

     At December 31, 2003, assuming the Company`s Appeal is successful, NSPI's
     unrecorded future income tax asset is approximately $237 million (2002 -
     $283 million), a decrease of approximately $46 million (2002 - $37
     million). The asset consists of deductible temporary differences of $619
     million (2002 - $715 million deductible temporary differences and $30
     million unused non-capital losses).

     If the Company's Appeal is unsuccessful, the unrecorded future income tax
     asset of NSPI would be approximately $47 million (2002 - $65 million),
     consisting of deductible temporary differences of $121 million (2002 - $171
     million).

     Preferred Share Dividends

     Preferred share dividends consist of preferred dividends less a recovery of
     income tax expense of $1.0 million (2002 - $3.9 million). The income tax
     recovery of $6.6 million in 2003 (2002 - $9.5 million) is reflected as a
     reduction of preferred share dividends with an offsetting increase in
     income tax expense.

                                                            2003         2002
     -------------------------------------------------------------------------
     Preferred share dividend                              $14.1        $14.1
     Part VI.1 tax on preferred share dividends              5.6          5.6
     Part I tax recovery related to the Part VI.1
     tax                                                   (6.6)        (5.2)
     deduction  - current year
     Part I tax recovery related to the Part VI.1              -        (4.3)
     tax
     deduction  - prior years
     -------------------------------------------------------------------------
                                                           $13.1        $10.2
     -------------------------------------------------------------------------


<PAGE>

Exhibit H


8.   ACCOUNTS RECEIVABLE SECURITIZATION

     In February 2002, the Company renewed an agreement with a third party to
     sell up to $88 million of high quality accounts receivables on a revolving
     basis. As part of the agreement NSPI continues to service all accounts
     receivables and retains an interest in 10% of the accounts receivables
     sold, which has been recorded as a deferred charge. This retained interest
     is measured at its carrying value, which is substantially equal to its fair
     value. At December 31, 2003, net trade receivables sold amounted to $50
     million (2002 - $75 million). The agreement is in place until February 2004
     with the intention that it be renewed at that time.

9.   RELATED PARTY TRANSACTIONS

     Due from associated companies represents the total carrying amounts of
     trade receivables, which are owed to NSPI by affiliated companies. The
     terms of repayments are the same as those for non-affiliate trade
     receivables. During the year NSPI had sales of $119.2 million (2002 - $19.5
     million) to and purchases of $18.7 million (2002 - $18.3 million) from
     companies under common control.

     During the year, in the ordinary course of business, the Company purchased
     transportation capacity totaling $17.0 million (2002 - $15.7 million) from
     the Maritimes and Northeast Pipeline, an investment under significant
     influence of NSPI's parent. The amount is recognized in fuel for generation
     and is measured at the exchange amount. At December 31, 2003 the amount
     payable to the related party is $1.3 million (2002 - $1.3 million).

10.  DEFERRED CHARGES AND CREDITS

     Deferred charges and credits comprise the following:

     millions of dollars

                                                             2003         2002
     ---------------------------------------------------------------------------
     Deferred charges:
     Unamortized debt financing and defeasance costs       $203.1        $214.0
     Pre-2003 income tax liability and related              148.7             -
     interest                                                36.1          28.6
     Accrued pension and non-pension benefit asset            5.0           7.5
     (note 5)                                                 6.1           6.2
     Retained interest in accounts receivable
     securitized
     Other
     ---------------------------------------------------------------------------
                                                           $399.0        $256.3
     ---------------------------------------------------------------------------

     Deferred credits:
     Future site restoration liability                     $22.5          $25.1
     Unearned revenue                                        6.7            6.6
     Other                                                   0.6            1.4
     ---------------------------------------------------------------------------
                                                           $29.8          $33.1
     ---------------------------------------------------------------------------

11.  PROPERTY, PLANT AND EQUIPMENT

     Property, plant and equipment is comprised of the following:


<PAGE>

Exhibit H


     millions of dollars
                                                    2003
     --------------------------------------------------------------------------
                                  Cost        Accumulated           Net
                                              Depreciation      Book Value
     --------------------------------------------------------------------------
     Generation
         Thermal                   $1,601.8           $609.8            $992.0
         Gas Turbine                   72.1             22.9              49.2
         Hydroelectric                357.5            118.9             238.6
         Wind Turbine                   2.9              0.1               2.8
     Transmission                     567.7            256.7             311.0
     Distribution                     961.3            428.2             533.1
     Other                            269.1             60.4             208.7
     --------------------------------------------------------------------------
                                   $3,832.4         $1,497.0          $2,335.4
     --------------------------------------------------------------------------

                                                    2002
     --------------------------------------------------------------------------
                                  Cost        Accumulated           Net
                                              Depreciation      Book Value
     --------------------------------------------------------------------------
     Generation
         Thermal                   $1,587.2           $581.8          $1,005.4
         Gas Turbine                   28.4             21.5               6.9
         Hydroelectric                354.9            114.9             240.0
        Wind Turbine                    3.2                -               3.2
     Transmission                     561.3            241.7             319.6
     Distribution                     932.0            396.0             536.0
     Other                            266.0             48.4             217.6
     --------------------------------------------------------------------------
                                   $3,733.0         $1,404.3          $2,328.7
     --------------------------------------------------------------------------

     At December 31, 2003, the Glace Bay generating station had a net book value
     of $22.5 million (2002 - $27.0 million). During the year NSPI amortized
     $6.2 million (2002 - $1.0 million) related to the plant, and capitalized
     $1.7 million in AFUDC (2002 - $1.8 million) to the plant value.

12.  LONG-TERM DEBT

     Long-term debt is composed of debentures and medium term notes payable. All
     long-term debt instruments are issued under trust indentures at fixed
     interest rates, and are unsecured. Also included is certain commercial
     paper where the company has the intention and the unencumbered ability to
     refinance the obligation for a period greater than one year.

                              Effective Average     Years of       2003    2002
                               Interest Rate %      Maturity
      millions of dollars     2003        2002
      --------------------------------------------------------------------------
      Medium Term Notes      7.135       7.321    2004 - 2097   1,240.0  $940.0
      Debentures             9.750       8.490    2003 - 2019      95.0   245.0
      Commercial Paper       2.765       2.730      One Year
                                                   Renewable       81.0   111.0
      --------------------------------------------------------------------------
                                                                1,416.0 1,296.0
      Less: Amount due                                            140.0   150.0
      within one year
      --------------------------------------------------------------------------


<PAGE>

Exhibit H


      --------------------------------------------------------------------------
                                                               $1,276.0 $1,146.0
      --------------------------------------------------------------------------

      Repayments of long-term debt are due as follows:

      millions of dollars
      -------------------------------------------------------------------------
      Year of Maturity                                2003                2002
      -------------------------------------------------------------------------
      One Year Renewable                             $81.0              $111.0
      2003                                               -               150.0
      2004                                           140.0               140.0
      2005                                           100.0               100.0
      2006                                            40.0                40.0
      2007                                               -                   -
      2008                                           115.0                   -
      Greater than 5 years                           940.0               755.0
      -------------------------------------------------------------------------
                                                  $1,416.0            $1,296.0
      -------------------------------------------------------------------------

13.  SHORT-TERM DEBT

     Short-term debt consists of commercial paper of nil (2002 - $115.6
     million). Commercial paper bears interest at prevailing market rates, which
     on December 31, 2003, averaged 2.77% (2002 - 2.88%). The operating line of
     credit consists of advances of $7.1 million (2002 - $6.5 million), which
     when drawn upon, bears interest at the prime rate, which on December 31,
     2003, was 4.50% (2002 - 4.50%). Short-term debt is unsecured.

14.  PREFERRED SHARES

     Authorized:

     Unlimited number of First Preferred Shares, issuable in series. Unlimited
     number of Second Preferred Shares, issuable in series.

     Issued and outstanding:
                                                                     Preferred
                                                       Millions of    Share
      millions of dollars                                   Shares   Capital
      -------------------------------------------------------------------------
      January 1, 2002                                         10.4      $260.0
      -------------------------------------------------------------------------
      December 31, 2002                                       10.4      $260.0
      -------------------------------------------------------------------------
      December 31, 2003                                       10.4      $260.0
      -------------------------------------------------------------------------

     Series B Preferred Shares and Series C Purchase Warrants

     On March 8, 1999, NSPI issued 5,000,000 First Preferred Share Units at a
     price of $6.25 per Unit. Each unit consisted of one non-detachable
     cumulative, redeemable First Preferred Share, Series B and a Warrant to
     purchase one cumulative, redeemable First Preferred Share, Series C for
     cash consideration of $18.75. On October 1, 2001, unit holders exercised
     4,417,116 Series C purchase warrants and Series B preferred shares, and
     converted them to Series C First Preferred Shares. Virtually all of the
     remaining Series C purchase warrants and Series B preferred shares were
     exercised on either January 1 or April 1, 2001 with a cash payment of
     $18.75. The remaining 1,305 Series B preferred shares, which had not been
     converted to Series C, were cancelled in


<PAGE>

Exhibit H


     the second quarter of 2002 and each shareholder received their original
     investment.

     Series C Preferred Shares

     Each Series C Preferred Share is entitled to a $1.225 per share per annum
     fixed cumulative preferential dividend, as and when declared by the Board
     of Directors, accruing from the date of issue and payable quarterly on the
     first day of January, April, July and September of each year. On or after
     April 1, 2009, NSPI may redeem for cash the Series C First Preferred
     Shares, in whole at any time or in part from time to time at $25.00 per
     share plus accrued and unpaid dividends. The Series C First Preferred
     Shares will be exchangeable into Emera Inc. common shares on April 1, 2009.

     Series D Preferred Shares

     On October 31, 2000, NSPI issued 5,400,000 First Preferred Shares for a
     price of $25 per share. Each share is entitled to a fixed cumulative
     preferential cash dividend of $1.475 per share per annum, as and when
     declared by the Board of Directors. These dividends will accrue from the
     date of issue and will be payable quarterly on the fifteenth day of
     January, April, July, and October of each year. On or after October 15,
     2015, NSPI may redeem for cash the Series D First Preferred Shares, in
     whole at any time, at $25 per share plus accrued and unpaid dividends. The
     Series D First Preferred Shares will be exchangeable into Emera Inc. common
     shares on October 15, 2015.

15.  COMMON SHARES millions of dollars

     Authorized:

     Unlimited number of non-par value Common Shares.

     Issued and outstanding:
                                                     Millions of  Common Share
                                                        Shares        Capital
     ---------------------------------------------------------------------------
     January 1, 2002                                         91.8        $752.5
     Common shares issued to parent                           4.8          75.0
     ---------------------------------------------------------------------------
     December 31, 2002                                       96.6        $827.5
     Common shares issued to parent                           0.2           3.1
     ---------------------------------------------------------------------------
     December 31, 2003                                       96.8        $830.6
     ---------------------------------------------------------------------------

16.  FINANCIAL INSTRUMENTS

     Financial instruments include the following:

                                         ---------------------------------------
     millions of dollars                       2003                2002
                                         Carrying   Fair     Carrying  Fair
                                           Amount    Value    Amount    Value
                                         Liability  LiabilityLiability Liability
                                          (Asset)   (Asset)   (Asset)  (Asset)
      --------------------------------------------------------------------------


<PAGE>

Exhibit H

      --------------------------------------------------------------------------
      Long-term debt                       $1,416.0 $1,597.5  $1,296.0 $1,430.7
      Short-term debt                           7.1      7.1     122.1    123.4
      Derivative financial instruments
      (hedges)
           Interest rate swaps                  1.4      7.6       0.9      9.0
           Interest rate caps and collars         -      0.3         -      0.8
           Natural gas swaps                      -    (0.3)         -    (1.7)
           Natural gas caps and collars       (3.6)      0.4     (2.1)    (1.5)
           Oil swaps                              -   (13.1)         -    (8.6)
           Foreign exchange contracts         (0.5)     11.0         -    (1.7)
      --------------------------------------------------------------------------

     Long-term Debt and Short-term Debt

     The fair value of NSPI's long-term and short-term debt is estimated based
     on the quoted market prices for the same or similar issues, or on the
     current rates offered to NSPI, for debt of the same remaining maturities.

     Derivative Financial Instruments

     The fair value of derivative financial instruments is estimated by
     obtaining prevailing market rates.

     Interest Rates

     The Company enters into interest rate hedging contracts to convert the
     interest characteristics of outstanding short-term debt from a floating to
     a fixed rate basis. Interest rate swap contracts converting floating
     interest on $120 million over 2004 to 2005 (2002 - $320 million over 2003
     to 2005) to a weighted average fixed interest rate of 6.48% (2002 - 5.68%)
     were outstanding at December 31, 2003.

     Interest rate collars are used to insure against extreme movements in
     interest rates on maturing debt. Interest rate collar contracts covering
     $50 million (2002 - $20 million) at average fixed interest rates in a range
     from 4.81% to 5.23% (2002 - 5.35% to 5.75%) were outstanding at December
     31, 2003.

     Commodity Prices

     The Company purchased natural gas option contracts and entered into natural
     gas swap contracts in 2003 to limit exposure to fluctuations in natural gas
     prices. As at December 31, 2003, the Company had hedged approximately 80%
     of all natural gas purchases and sales for 2004.

     The Company enters into oil swap and option contracts to limit exposure to
     fluctuations in world prices of heavy fuel oil. As at December 31, 2003,
     the Company had entered into oil swap contracts that fixed the price of
     approximately 55% of 2004 requirements along with a portion of 2005
     requirements.

     The Company also entered into option contracts for the physical delivery of
     natural gas and coal.

     Foreign Exchange


<PAGE>

Exhibit H


     The Company enters into foreign exchange forward, option, and swap
     contracts to limit exposure to currency rate fluctuations. Currency
     forwards are used to fix the Canadian dollar cost to acquire U.S. dollars,
     reducing exposure to currency rate fluctuations. Forward contracts to buy
     U.S. $84 million over 2004 and 2005 (2002 - U.S. $79 million over 2003 and
     2004) at a weighted average rate of CAD $1.4234 (2002 - CAD $1.5516) were
     outstanding at December 31, 2003. There were also option contracts to buy
     U.S. $50 million in 2004 (2002 - U.S. $110 million over 2003 to 2007) at
     rates in a range from CAD $1.3180 to $1.5600 in 2004 (2002 - range of CAD
     $1.5600 in 2003 to $1.6703 in 2007) outstanding at December 31, 2003.

     Risk Management

     Interest rate risk The Company makes use of various financial instruments
     to hedge against interest rate risk, as discussed above. Additionally, the
     Company uses diversification as a strategy. It maintains a portfolio of
     debt instruments which includes short-term instruments and long-term
     instruments with staggered maturities. The Company also deals with several
     counterparties so as to mitigate interest rate concentration risk.

     Credit risk
     The Company is exposed to credit risk with respect to amounts receivable
     from customers. Credit assessments are conducted with respect to, and
     deposits are requested from, many new customers. The Company also maintains
     provisions for potential credit losses, which are assessed on a regular
     basis. With respect to customers outside of the sphere of electric
     customers, counterparty creditworthiness is assessed through reports of
     credit rating agencies or other available financial information.

17.  COMMITMENTS

     NSPI had the following significant commitments at December 31, 2003:

o    An annual requirement to purchase approximately 190 GWh of electricity from
     independent power producers for each of the next twenty years.
o    A requirement to purchase approximately 61.6 million cubic feet of natural
     gas per day for the next eight years, and an additional 4 million cubic
     feet per day, at the option of the supplier, for five years.
o    Commitments to purchase approximately 65,000 mmbtu per day of
     transportation capacity on the Maritimes and Northeast Pipeline for periods
     ranging from nine to nineteen years at an approximate cost of $16 million
     per year.
o    Responsibility for managing a portfolio of approximately $1.1 billion of
     defeasance securities held in trust. The defeasance securities must provide
     the principal and interest streams of the related defeased debt.
     Approximately 69%, or $750 million, of the defeasance portfolio consists of
     investments in the related debt, eliminating all risk associated with this
     portion of the portfolio.


<PAGE>

Exhibit H


o    Commitment to a third party for the transportation of its coal at its
     Lingan and Point Aconi generation station for ten years beginning in late
     2002 at an approximate cost of $15 million per year.

18.  GUARANTEES

     The Company had the following guarantees at December 31, 2003:

o    Nova Scotia Power has guaranteed a tenant's obligation to its project
     sponsor to a maximum amount of $0.5 million for a term of 12 years
     beginning in 1997. The carrying amount of the guarantee is nil.

19.  COMPARATIVE INFORMATION

     Certain of the comparative figures have been reclassified to conform to the
     financial statement presentation adopted for 2003.



<PAGE>

Exhibit H


OPERATING STATISTICS

Five-Year Summary

                                  2003     2002     2001     2000     1999
- -----------------------------------------------------------------------------
Electric energy sales (GWh)
- -----------------------------------------------------------------------------
Residential                      3,818.9  3,835.0  3,756.7  3,632.1  3,494.6
Commercial                       3,000.9  2,818.3  2,724.9  2,661.9  2,582.8
Industrial                       4,091.3  3,786.2  3,831.6  3,917.2  3,834.8
Other                              595.3    786.3    592.6    445.0    453.2
- -----------------------------------------------------------------------------
Total electric energy sales     11,506.4 11,225.8 10,905.8 10,656.2 10,365.4
- -----------------------------------------------------------------------------
Sources of energy (GWh)
- -----------------------------------------------------------------------------
Thermal - coal                   9,218.7  8,862.2  8,854.8  8,863.7  7,816.0
              - oil              1,535.8    287.7    690.7  1,347.8  1,870.9
              - natural gas        119.5  1,578.7  1,129.1     43.8        -
Hydro                            1,077.0  1,024.3    692.2    881.2    980.7
Wind                                 2.6      0.3        -        -        -
Purchases                          375.2    277.6    279.4    295.2    411.3
- -----------------------------------------------------------------------------
Total generation and purchases  12,328.8 12,030.8 11,646.2 11,431.7 11,078.9
Losses and internal use            822.4    805.0    740.4    775.5    713.5
- -----------------------------------------------------------------------------
Total electric energy sold      11,506.4 11,225.8 10,905.8 10,656.2 10,365.4
- -----------------------------------------------------------------------------

- -----------------------------------------------------------------------------
Customers
- -----------------------------------------------------------------------------
Residential                      415,254  411,571  403,767  400,653  397,406
Commercial                        32,873   32,743   32,159   32,186   31,753
Industrial                         2,347    2,280    2,246    2,194    2,118
Other                              8,339    7,917    7,332    7,073    6,760
- -----------------------------------------------------------------------------
Total customers                  458,813  454,511  445,504  442,106  438,037
- -----------------------------------------------------------------------------

- -----------------------------------------------------------------------------
Capacity
- -----------------------------------------------------------------------------
Generating nameplate capacity
(MW)                               1,243    1,243    1,243    1,243    1,243
Coal Fired                           350      350      350      250        -
Dual Fired                             -        -        -      100      350
Heavy Fuel Oil-Fired                 254      204      204      204      204
Gas Turbine                          395      395      395      395      395
Hydroelectric                          1        1        -        -        -
Wind Turbine                          25       25       25       25       25
Independent power producers
- -----------------------------------------------------------------------------
                                   2,268    2,218    2,217    2,217    2,217
- -----------------------------------------------------------------------------

Total number of employees          1,750    1,833    1,970    1,948    1,912
- -----------------------------------------------------------------------------
km of transmission lines (69       5,175    5,250    5,250    5,250    5,250
kV and over)
- -----------------------------------------------------------------------------
km of distribution lines (25      24,847   24,609   24,533   24,000   24,000
kV and under)
- -----------------------------------------------------------------------------


<PAGE>

Exhibit H


FINANCIAL INFORMATION
Five-Year Summary
Years Ended December 31 (millions    2003     2002    2001    2000     1999
of dollars)
- ------------------------------------------------------------------------------
Statement of Earnings Information
- ------------------------------------------------------------------------------
Revenue                             $904.6   $876.5   $838.6   $818.9   $798.9
- ------------------------------------------------------------------------------
Cost of operations
Fuel for generation and power        277.8    335.6    301.0    273.9    267.5
purchased                            186.0    176.4    156.8    156.7    144.0
Operating, maintenance and general    26.2     15.2     13.2     11.0      8.9
Grants in lieu of property taxes       7.2      6.8      7.0      6.7      6.8
Provincial capital tax               101.7    103.9     99.6     97.1     94.2
Depreciation
- ------------------------------------------------------------------------------
                                     598.9    637.9    577.6    545.4    521.4
- ------------------------------------------------------------------------------
Earnings from operations             305.7    238.6    261.0    273.5    277.5
Amortization                         (6.2)    (1.0)    (3.0)   (19.0)   (23.1)
Allowance for funds used during        4.5      3.4      5.1      4.8      4.8
construction
- ------------------------------------------------------------------------------
Earnings before interest and         304.0    241.0    263.1    259.3    259.2
income taxes                         104.3    109.6    112.3    111.5    111.5
Interest                              16.7     19.4     19.8     19.8     20.0
Amortization of defeasance costs
- ------------------------------------------------------------------------------
Earnings before income taxes         183.0    112.0    131.0    128.0    127.7
Income taxes                          57.8     15.7     13.9     14.4     13.2
- ------------------------------------------------------------------------------
Net earnings before dividends        125.2     96.3    117.1    113.6    114.5
Preferred share dividends             13.1     10.2     12.0      9.9     11.3
- ------------------------------------------------------------------------------
Net earnings applicable to common    112.1     86.1    105.1    103.7    103.2
shares                                70.0     84.4    161.2     93.2     72.2
Common dividends
- ------------------------------------------------------------------------------
Earnings retained for use in         $42.1     $1.7  ($56.1)    $10.5    $31.0
Company
- ------------------------------------------------------------------------------
Cost of fuel for generation - coal  $211.8   $229.6   $202.9   $186.3   $184.3
                            - oil     91.4     20.6     40.7     60.5     58.2
                      - natural gas (58.4)     62.5     35.8      5.9        -
                                      33.0     22.9     21.6     21.2     25.0
Power purchased
- ------------------------------------------------------------------------------
Total cost of fuel for generation   $277.8   $335.6   $301.0   $273.9   $267.5
and power purchased
- ------------------------------------------------------------------------------
Balance Sheet Information
Current assets                      $189.6   $242.5   $250.9   $186.2   $139.1

Deferred charges                     399.0    256.3    272.2    285.0    315.3
Property, plant and equipment      2,372.3  2,384.5  2,381.8  2,367.5  2,357.4
- ------------------------------------------------------------------------------
Total assets                      $2,960.9 $2,883.3 $2,904.9 $2,838.7 $2,811.8
- ------------------------------------------------------------------------------
Current liabilities                 $296.3   $390.6   $457.8   $455.3   $358.7
Deferred credits                      29.8     33.1     25.2     26.3     18.8
Long-term debt                     1,276.0  1,146.0  1,185.0  1,155.0  1,260.5
Preferred shares                     260.0    260.0    260.0    249.1    231.3
Common shares                        830.6    827.5    752.5    672.5    672.5
Retained earnings                    268.2    226.1    224.4    280.5    270.0
- ------------------------------------------------------------------------------
Total equity and liabilities      $2,960.9 $2,883.3 $2,904.9 $2,838.7 $2,811.8
- ------------------------------------------------------------------------------
Statement of Cash Flow Information
Cash provided by operating          $179.4   $218.3   $145.4   $219.9   $264.7
activities
Cash used in investing activities    $96.7   $104.6   $111.8   $121.4   $114.1
- ------------------------------------------------------------------------------



</TEXT>
</DOCUMENT>
</SEC-DOCUMENT>
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