Adapting to a Changing Energy Environment Russ Girling, President and CEO, TransCanada Corporation

May 15, 2012

STRIKING A BALANCEIN THE MIDST OF CHANGE

May 13-16, 2012Québec City, Québec (Canada)

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Forward-Looking Information

This presentation may contain certain information that is forward looking and is subject to important risks and uncertainties. The words "anticipate", "expect", "believe", "may", "should", "estimate", "project", "outlook", "forecast" or other similar words are used to identify such forward-looking information. Forward-looking statements in this presentation are intended to provide TransCanada security holders and potential investors with information regarding TransCanada and its subsidiaries, including management’s assessment of TransCanada’s and its subsidiaries’ future financial and operational plans and outlook. Forward-looking statements in this presentation may include, among others, statements regarding the anticipated business prospects, and financial performance of TransCanada and its subsidiaries, expectations or projections about the future, strategies and goals for growth and expansion, expected and future cash flows, costs, schedules (including anticipated construction and completion dates), operating and financial results, and expected impact of future commitments and contingent liabilities. All forward-looking statements reflect TransCanada's beliefs and assumptions based on information available at the time the statements were made. Actual results or events may differ from those predicted in these forward-looking statements. Factors that could cause actual results or events to differ materially from current expectations include, among others, the ability of TransCanada to successfully implement its strategic initiatives and whether such strategic initiatives will yield the expected benefits, the operating performance of the Company's pipeline and energy assets, the availability and price of energy commodities, capacity payments, regulatory processes and decisions, changes in environmental and other laws and regulations, competitive factors in the pipeline and energy sectors, construction and completion of capital projects, labour, equipment and material costs, access to capital markets, interest and currency exchange rates, technological developments and economic conditions in North America. By its nature, forward-looking information is subject to various risks and uncertainties, which could cause TransCanada's actual results and experience to differ materially from the anticipated results or expectations expressed. Additional information on these and other factors is available in the reports filed by TransCanada with Canadian securities regulators and with the U.S. Securities and Exchange Commission (SEC). Readers are cautioned not to place undue reliance on this forward-looking information, which is given as of the date it is expressed in this presentation or otherwise, and not to use future-oriented information or financial outlooks for anything other than their intended purpose. TransCanada undertakes no obligation to update publicly or revise any forward-looking information, whether as a result of new information, future events or otherwise, except as required by law.

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What am I going to say…?

• Who is TransCanada

• Changing Markets• Gas Pipelines

• Oil Pipelines

• Power Generation

• Adapting and Accommodating Changes

Delivering Critical Energy Infrastructure

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TransCanada

One of North America’s Largest Natural Gas Pipeline Networks

• 68,500 km (42,500 mi) wholly and partially-owned

• Average volume of 14 Bcf/d

North America’s 3rd Largest Natural Gas Storage Operator

• 380 Bcf of capacity

Canada’s Largest Private Sector Power Generator

• 20 power plants, 10,900 MW

• Wind, Solar & Hydro – 1,390 MW

Premier North American Oil Pipeline System

• 1.4 million Bbl/d ultimate capacity

Enterprise Value ~ $55 billion

4,400 Employees

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Natural Gas Pipelines

• Supply being developed close to traditional markets

• Innovative changes to tolling and services required on existing infrastructure to remain competitive

• Regulators provide balance in utilization of existing infrastructure and building of newNorth American Gas Supply/Demand Balance

The Emergence of Unconventional GasBcf/d

Mexico

Gulf of Mexico + U.S. Other

U.S. Rockies

U.S. Shale

WCSBBC Unconv.

LNGDemand

Eastern Canada

History Forecast

LNG

Source: TransCanada Fall 2011 Outlook

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Canadian Crude Oil Penetration (MBPD)

Canadian Imports

Production

Capacity

Source: 2012 EIA Actuals.

All values in M bpd.

Non-Canadian Imports

Canadian Sourced Oil

0

500

1000

1500

2000

2500

3000

3500

4000

4500

2005 2010 2015 2020

WCSB Bitumen Blend

WCSB Upgraded Light

WCSB Conventional Light

History Forecast

WCSB Conventional Heavy

MBPD WCSB Crude Oil Supply Outlook

0

500

1000

1500

2000

2500

3000

3500

4000

4500

2005 2010 2015 2020

WCSB Bitumen Blend

WCSB Upgraded Light

WCSB Conventional Light

History Forecast

WCSB Conventional Heavy

MBPD WCSB Crude Oil Supply Outlook

Foreign Imports

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U.S. Power Generation by Fuel Type

TWh

Source: U.S. Energy Information Administration Annual Energy Outlook 2012 – Early Release Overview

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Energy Infrastructure Development

Source: International Energy Agency (IEA) World Energy Outlook 2011 - New Policies Scenario

Cumulative Investment in Energy Supply Infrastructure by Region and Fuel 2011-2035

0 1 2 3 4 5 6 7 8

North America

China

OECD Europe

E. Europe/Eurasia

Africa

Latin America

Other Asia

Middle East

India

OECD Asia Oceania

$ trillion (2010)

Power

Oil

Gas

Coal

Biofuels

$ Trillion (2010)

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Take-Aways / Challenges

Need: Energy Infrastructure - “New and Old”

Need: Thoughtful, Balanced, Inclusive, and Honest Process to Determine What We Want To Do (Good Policy)

Need: Timely, Efficient, Balanced, Informed, Predictable and Accountable Process, and Institutions to Implement Policy(Good Regulation)