PowerStream Inc.

PowerStream Inc.

December 21, 2006 07:48 ET

PowerStream Sells Water Heater Rental Business

Utility now focusing more on core business of electricity distribution

YORK REGION, ONTARIO--(CCNMatthews - Dec. 21, 2006) - In a move designed to streamline company operations and help provide greater focus on its core business of electricity distribution, PowerStream has agreed to sell its water heater rental business to The Consumers' Waterheater Income Fund (Consumers' Waterheater)(TSX:CWI.UN).

The assets of the business include approximately 4,100 customer water heater accounts which PowerStream has been servicing in the Markham area since the 2004 merger of three local electricity utilities that created the company.

"The sale of the water heater assets is consistent with our strategy to be more focused on our core business of providing electricity distribution services to the customers in our service territory," Brian Bentz, PowerStream's President and CEO explained. "By selling the water heater assets to an affiliate of The Consumers' Waterheater, we have ensured that these customers will be serviced by an organization which specializes in this type of product and business."

Consumers' Waterheater owns a portfolio of over 1.3 million installed water heaters and other assets which are rented primarily to residential customers in Ontario.

"We are pleased to be adding the PowerStream water heater customers to the ones we currently serve in Ontario," said John Macdonald, President and CEO, Consumers' Waterheater. "Through our service provider, Direct Energy Marketing Limited, we will provide these customers with the highest level of service."

Direct Energy currently supports the Consumers' Waterheater with a roster of 500 service technicians and 150 installation and replacement crews that are made available to CWIF customers through Direct Energy, its franchisees or their subcontractors.

Under the terms of the agreement between PowerStream and Consumers' Waterheater, the transfer of assets will become official on December 29, 2006, although PowerStream will continue the billing function on a pro-rated basis until December 31, 2006 on behalf on CWIF. After that date, customer inquiries will be directed to Direct Energy Essential Home Services at 1-800-266-3939.

About PowerStream

PowerStream Inc. is one of the largest local electricity distribution companies in Ontario, providing service to more than 225,000 residential and business customers in the municipalities of Aurora, Markham, Richmond Hill and Vaughan. It is an incorporated entity, jointly owned by the City of Vaughan and the Town of Markham.

About The Consumers' Waterheater Income Fund

The Consumers' Waterheater Income Fund owns a portfolio of over 1.3 million water heaters and other assets, leased primarily to residential customers in Ontario. Direct Energy Essential Home Services provides service support to the portfolio and receives 35% of aggregate rental revenues; thereby significantly reducing the Fund's operating risk. The asset base has been generating stable and growing cash flows since its inception in the late 1950s. For more information visit, www.consumerswaterheaters.com.

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