Good day everyone and welcome to the ITC Holdings Corp First Quarter 2008 Financial Results Conference Call and webcast. Today's conference is being recorded. At this time for opening remarks and introductions I'd like to turn the call over to Miss Pat Wenzel. Please go ahead.

Good morning and thank you for joining us for ITC Holdings Corps 2008 first quarter earnings conference call. Today we will be discussing our first quarter results. Joining me on today's call are Joseph Welch, President and CEO of ITC Holdings Corp and Edward Rahill, our Senior Vice President and CFO. Last night we issued a press release summarizing our first quarter results. We expect to file our form 10-K with the Securities and Exchange Commission today. Before we begin, I would like to remind everyone of the cautionary language contained in the following safe harbor statement. Certain statements made during today's call that are not historical facts such as those regarding our future plans, objectives and expected performance are forward-looking statements as defined by the Private Securities Litigation Reform Act of 1995. These forward-looking statements represent our outlook only as of today. While we believe that these statements and their underlying assumptions are reasonable, investors should know that actual results may differ from our projections and expectations, because they are based on current facts and are subject to risks and uncertainties. A discussion of the risks inherent in our business that could cause these differences may be found in certain documents filed with the SEC such as our Form 10-Q expected to be filed today, our other periodic reports filed on Form 10-Q and 10-K, as well as our other SEC filings. You should consider these risk factors when evaluating our forward-looking statements. We disclaim any obligations to update or alter our forward-looking statements except as required by law. At this time, I would like to turn the call over to Ed Rahill to discuss the first quarter financial results.

Thanks Pat. We are very pleased with our 2008 first quarter financial results which demonstrate the continued success of our growth strategy. The improvements in the results compared to 2007 was mainly driven by the acquisition of our Interstate Power and Light electric transmission asset and our ITC Midwest in December of 2007. In the first quarter of 2008 ITC reported net income of $25.5 million or $0.53 per share, that’s diluted share. This is compared to net income of 16.9 million or $0.39 per diluted share for the first quarter of 2007. Operating revenues of 141.9 million for the first quarter increased 40.6 million over the comparable quarter in 2007. Network revenues increased by 28.2 million due to our acquisition of the IPL transmission assets. Additionally, METC and ITCTransmission recognized additional network revenues of 5.9 million due to higher net revenue requirements primarily due to the higher rate base and as a result of property, plant and equipment placements of service among other factors. Point-to-point scheduling control and dispatch revenues also increased in the first quarter 2008 as compared to the first quarter of 2007. Increases in operation and maintenance expenses for the first quarter were mainly driven by the expenses occurred by ITC Midwest that were not included in our results of operations for the first three months ended March 31st of 2007. General and administrative expenses or G&A increased by about 3 million compared to 2007 driven again by the growth that we have experienced over this period. G&A expenses increased primarily due to personal additions and other higher business expenses all which include incremental cost occurred by ITC Midwest. These increases are due to the continued growth of ITC. Depreciation and amortization expenses increased 6.2 million in the three months ended March 31st 2008 as compared…

Thanks Ed. 2008 is after a great start, as we continue to pursue ITC’s mission of building electric transmission infrastructure and promoting policies focused on increasing reliability, facilitating access to the renewable resources, and providing equal access to the most efficient and cleanest power. As Ed mentioned, the acquisition of IPLs transmission asset is a main driver of our improved financial performance in 2008. The integration of the IPL transmission asset is on track and we expect to be fully integrated by December 2008. We are moving forward with our development efforts to expand outside of Michigan. ITC Great Plains has previously announced it would pursue the approval needed to build two transmission projects, 185-mile-long high-voltage line running from between Spearville, Kansas and Axtell Nebraska, known as the KETA project and the Kansas V-Plan and another 180-mile line connecting Spearville to Wichita, Kansas, which is the northern portion of the Southwest Power Pool (SPP) X-Plan. These two projects are included in the SPP 2008-2017 transmission expansion plan also known as the STEP process that was approved by SPP's regional state committee at the end of January. ITC Great Plains filed an application with a Kansas Corporation Commission a week of April 6th to expand ITCs certificate for the Kansas D plan as required by the stipulation agreement. We are working with SPP to qualify both projects for the new SPP approved "postage stamp rate" that will spread the cost of certain projects over a broader geographical region. Successful inclusion in the SPP balance portfolio is required before we would be able to proceed with either of these projects. We believe the projects will qualify since the whole region will benefit. These projects will help spur economic development, facilitate the development of renewable energy, and improve the reliability of the grid.…

Good morning.

Good morning.

I just have the issues impacts thus regarding transmission and of course published with study, do you have any updated thought on opportunities you might receive on the panhandle?

Hi this is Ed Rahill. We have taken a very close look at Texas and we are basically focusing and the panhandle of Texas that is within the SPP RTL. Currently, we have had discussions to get a utility status in Texas and to do that we need to have a project in order to be accepted as utility. So we are looking at that right now, but primarily our efforts are in Kansas and Oklahoma.

Okay great. And then with the AEP joint venture. What causing the delay in formalizing the joint venture structure?

Actually, I think the cause of the delay is more from the question standpoint rather than the action. I think what we have said for quite a while is that we thought that we would have it done by the end of the second quarter of this year and we are pretty much on track for that. The fact is that there is a lot of details to be worked out and we have made really good progress and we are really close to the end of it, but the fact is that we do not have a signed document, but we are on track to be done by the end of the second quarter.

Okay and then with Oklahoma and Kansas utility status, can you give us an update on that. Where you guys are at?

Well actually in Kansas we do have utility status and we have actually, as I said in my prepared remarks, we are moving forward with the necessary regulatory approvals to start to build some of the lines. In Oklahoma, the process is in place and we are just going through the regulatory process now beginning.

Okay, thanks very much.

(Operator Instruction). And we will take our next question from Neil Kalton with Wachovia.

Hi good morning.

Good morning.

Question on SPP and the postage stamp, the application, when do you expect that to be decided by?

We expect to have the balance portfolio, the first group of the products in the balance portfolio are decided by we’ve been told the end of the third quarter beginning of the fourth quarter of this year.

Okay. And then once you have that you can then go to Kansas and try to get those lines sighted. Is that how the process works.

We have applied for stabilize to begin the process of beep in position to do exactly that. But as Joe made it very clear is that we need to have everyone understand is that the posted stand treatment of these projects needs to occur and then we would begin to move. We get that we are ready to move.

Okay so in terms of how we think about stealing the ground. This is probably sort of a mid to late '09 event at the earliest. Would that be a fair assessment?

It’s early to start. It’s going to take a while to go.

Okay. And then my second question is there - you mentioned that you are still in the process in Oklahoma getting the approval. Is there any time frame or expectation when we might have a decision there?

The process as we understand it is that the ALJ is going her recommendation sometime later this year. And we have no means by – she is not required to do that by a particular date. So we really are at a point where we are just working with the process and that’s it.

Okay thanks.

Our next question comes from Peter Homans with (Parklin).

Hi this is this is my call with you all and I was curious from a strategic standpoint. It seems to me that you have grown thus far by buying assets from existing utilities and then building them out for the – you're build has been on top of an existing asset and you are also operating by expanding contagiously if I understand correctly. I am curious on a longer term basis do you, one plan to build any capacity sort of brand new, in other words not buy existing capacity but actually just start off and build new throughput. And there's a problem in the total US structure which is that there are some areas that have excess capacity and some that have a shortage at times and the grid isn't set up to get twilled up excess to the area of deficiency. If you are always contiguous so far you’re not addressing that issue. Do you plan to address that issue?

Well actually we are not contiguous today. ITC Midwest is not contiguous with the Michigan footprint that we have.

Terrific, but I know about Mid-west.

That’s okay let me - I wish you would have ask me one these questions when I am giving the speech because actually as you artfully outlined that the frailty of the grid is on a regional nature. And the energy issues that face this country today are national issues. Global warming, carbon footprint, these are all national energy issues and we don't have a regional transmission grid in this country ass bad as that may sound for as old of as an industry as the this is, we don't have the regional network or the equivalent of the interstate highway system. And our goal and our vision is to be a major player in the regional development and transmission. Hence all of the activities that our development team is being doing in Kansas, Oklahoma, the things that we have started to really actively pursue with the integration of the renewable resource portfolios. There are vast resources of renewables, high capacity renewables that are available but they are not usually co-located where the load is and as a result of that again you need a regional network to move that. Mine-mouth coal is more cost efficient both from a production of kilowatt hours and to a mitigation of CO then any kind of other transshipment that there exist. And so, again you need a high-voltage network to do that. The point that you pointed out is there are regions in the country that have more capacity then they currently need and other regions in the country are looking at building generation. We need to build the networks so we can move that power freely across the grid to benefit from diversity, to minimize carbon foot print, to increase efficiency and now our goal is to be major player in that.

And the way - so you know, you are not contiguous, you are in the Midwest, so you are not planning to create sort of long lines that go from Washington State to Florida or anything that addresses other than being a part of building out and improving the grid question that connected to other folks who will beat the other things, same thing. And then secondly, if you keep referring to bringing an less production of carbon et cetera, I have read a lot of the information, I am just curious what is the principle mechanism or power of production process should you - you tend settle on to lower carbon users?

I have to go back.

Production?

Yeah. Let me give although questions here. We are located in the Midwest and our focus is the Midwest, but we certainly as a company wouldn’t run from building a transmission line somewhere else, its just that where we have the most expertise and the talent and the ability to move our workers in an efficient manner that allows us to do it, but its just in the Midwest there is probably about a $30 billion with a transmission work that has to be done and so, for company of our size that will probably keep us busy, well that's my existence here on the earth.

Okay.

The other thing is – let start off with Green and why we are talking about this. The current transmission and distribution network that exists today is very inefficient. It is you know I want to emphasize this very inefficient. So people will see – there is only small percentages that you could move that efficiency in other words you go from 10% to 9%, but that’s multiplied time hundreds of thousands of megawatts that are produced daily.

Alright.

So if you reduce the amount of generation by just making the grid more efficient you thereby definition reduces the amount of ignition for going into there. And think about this is the ultimate grid no one has to do any thing to change their lifestyle. And yet, the ignitions that we met today are better. If we bring in high capacity wind, we don’t produce it, but if we know where is that and always the developers know where is that, and if we can get to the markets, the large regional markets that exist in Chicago, Detroit, Philadelphia and all the areas of the Mid West hat have a large load usage and we can bring that high capacity renewable carbonless energy to the market then we again have reduced the carbon foot print. Demand responses is the something that is very important, if we have people who are willing to reduce their demands on the grid and there are other people who want access to that power that it releases, we do need a high voltage transmission grid to do that and it has to be original and design, and again that reduces carbon foot print.

And so, one really quickie final, you’re carrying the power. So what you are saying that is that unequited meeting to be upgraded grid actually briefs out power and therefore at the production end it takes more fuel to produce the same amount of energy then if you had a more efficient grid?

Absolutely.

Okay. And order of magnitude?

Well I digest up pointed out in our…

You said a couple of percent, I think you said – or it is just same I think.

I think there is couple percent out there, and – but I pointed out just in the development of our 765 kv line which is just a one line here in the Midwest that will reduce the capacity needs of the grid by 250 megawatts at the time of system peak which is about one half of the large major coal carbon producing generator.

Okay anyway I want to answer in more type to your responses.

(Operators Instruction). And we have a question from Samantha Dennison with Credit Suisse.

Hi good morning. Just one quick followup, do you guys have a sense of when you will be able to provide updated CapEx numbers?

We will probably do it somewhere around the end of the beginning of the third quarter. We’ve got quite a bit of updating to do and of course; with the integration of ITC Midwest our workload has gone up quite a bit. There e is a lot of work we have to do out there and the fortunate thing for us we were able to get on that really, quickly and turn that around, but we looked to sometime around the third quarter to being able to start to get that.

Okay great and just one other followup, what’s your outlook for development expenses at the moment?

If you talk to me then, we are doing it a lot, but we have put some money aside but we really don’t like to disclose exactly the exact numbers because there are things happened in development and litigation being a big one where you can spend a lot of money in regulatory filings. I think that the guys have worked through that very efficiently and we kept those numbers to a minimum. But I don’t aid to give people budget numbers.

Joe, one other thing, Joe is correct. And one of the problems of giving you an indication is the development by nature is opportunistic and so, we cant – we cant at this time even get a hit, we don’t forecast the future and don’t know what activities we will be doing in the third quarter. We are putting the efforts and that’s what we can tell you.

Okay thanks for the call.

Thank you,

And we have a follow up question from Peter Homans with (Parklin).

One followup just on history in going forward, have you ever, in any of the acquisition you done or would you in the future acquisitions of existing medal if you will do a dilutive acquisition?

The answer to that is no.

Okay. So any acquisition you have done in the past has been accretive immediately?

Every acquisition has been accretive day one

And what's the order of magnitude if you spend $10 million upgrading part of your bread, what's your return on that incremental expense?

Now its -- our return is outlined by the rate of return that we get from the Federal Energy Regulatory Commission and it’s different across our footprints. For ITCTransmission our rate of return is 13.88, for our METC acquisition or METC assets it’s 13.38 and for ITC Midwest it’s 12.38. And if you work through math on the capital structure you will be able to calculate what that is.

And the fork itself is – I was involved in a takeover rollup FERC you tell everyone the first, and two Arizona were up 15 years ago, and if FERC, I understand FERC is much less constructive than state utility boards, but what are the criteria that they use, if there are camp on FERC a company can earn on investment or can you increase your returns by explaining the nature of the investment?

FERC is a policy making body, and I hate to sound kind of Q, but I say this, but they don’t ask me what my opinion is what they are doing.

Right.

We know we know what they’ve allowed us, we know – we’ve got benchmarks of what they’ve not allowed us to do, and we just try to play in the field that they are doing and of course, our goal for the shareholder is to run as high later return as we can and of course their goal is regulators through our in charge with green reasonable and cost control their goals to bring it down as low as they can, still trying to get policies implemented that they want to have. Transmission is one of these areas where they have really over the years putout incentives to try to get more transmission build. I think nationwide there is a huge gap between getting transmission built clearly on the regional basis none is being built, and what they have been able to do. So, they offer the incentives and we’re just trying to operate the matter where we can get them.

Okay, thank you.

And there are no further questions at this time. I would like to turn the conference back over to our speakers for any additional or closing remarks.

This concludes the question and answer portion of our call. Before I end the call I would like to thank everyone who participated today. Anyone wishing to hear the conference call replay available through May 8, 2008, to dial toll free 888-203-1112 domestic or 719-457-0820 International. The pass code is 8240784. The webcast of this event will also be archived on the ITC Holding website at https://investor.itc-holdings.com. Good bye and have a great day.

And that concludes todays teleconference. Thank you for your participation and you may now disconnect.