The Consumers' Waterheater Income Fund commenced operations in December 2002. The Fund is engaged in the water heater rental business with over 1.3 million water heaters, rented primarily to residential customers in Ontario. The water heater rental business arose during the late 1950's when the Ontario government began encouraging consumers to switch to natural gas for their heating needs. The rental program provides homeowners with a convenient way of installing and maintaining a vital piece of equipment in their home – with no capital outlay and with a convenient fixed, monthly fee currently bundled with their natural gas bill.

The Fund's objective is to generate a stable and growing cash flow stream.
 
About the Consumers Waterheater Income Fund
In May 2002, EGD sold Enbridge Services Inc., - which included its Home and Business Services divisions as well as the water heater rental portfolio - to Centrica Canada Limited. Centrica Canada Limited is also the parent company of Direct Energy Marketing Limited, North America’s largest energy retailer. Centrica’s strategy was to monetize the value of the waterheater assets, and focus on creating incremental value from the underlying customer relationships. This resulted in the creation of the Consumers’ Waterheater Income Fund in December, 2002.

The Fund structure entitles the Fund to receive 65% of rental revenues; Direct Energy - receives 35% for continuing to provide life-cycle service support for the asset base.
With this minimal exposure to operating risk, and a fixed-rate debt obligation, the Fund generates very stable cash flow, making it ideally suited to the income trust structure.