Letter from the Chairman

To Our Stakeholders:

Con Edison has been powering New York for 200 years, and we rely on our sustainability strategy to prepare us for the next 200. Keeping our company viable into the future allows us to continue to deliver the world-class service our customers expect and deserve. We know people are looking for more energy choices, and we must adjust our business model to meet their needs. All the while, we must operate in the most environmentally responsible way and continue to improve the quality of life of our communities.

Our primary mission is to provide the 10 million people living in our service area with safe, efficient, clean, and reliable energy.

We are still feeling the effects of Superstorm Sandy, which devastated our region and left more than a million of our customers without power. We are investing $1 billion to enhance our infrastructure, protecting our customers and our region from the next storm of the century. We are a year into our four-year Fortifying the Future plan, which will help our system withstand increasingly severe and damaging weather.

We are committed to helping New Yorkers breathe cleaner air, for our own sake and for future generations. Our focus on the environment helped us yield an approximately 43% reduction in greenhouse gas emissions from our 2005 baseline. We installed our first solar array at our Manhattan headquarters and have supported the installation of more than 50 MWs of solar systems across our service territory. To improve air quality, we completed more than 1,600 oil-to-gas conversions.

Con Edison is also committed to safety, for our employees and the public. Our work is paying off – we finished 2013 with record low OSHA incident rates at both of our regulated utilities.

We are working to advance strong, vibrant, and stable communities through our proud support of nonprofit organizations throughout our region. We work with organizations committed to education, the environment, civics, community, and the arts.

We tapped the power of our people to further this effort. Our Con Edison employee volunteers gave more than 5,900 hours to plant trees, mentor children, help disadvantaged women with resumes and interview skills, and feed the hungry.

This report outlines the moves we are making to align all that we do to contribute to a cleaner and brighter future. We will continue our commitment to provide safe and reliable service, protect the environment, and contribute to the vitality of our communities, for the benefit of our customers and our company.

-John McAvoy, chairman, president, and CEO, Consolidated Edison, Inc.