June 26, 2006

Ontario commits to added nuclear power, stronger conservation, more renewables as part of long-term energy mix

Added nuclear power generation and renewable energy sources, in tandem with a strengthened conservation plan, are the highlights of a 20-year electricity supply mix plan, proposed by the Ontario Power Authority (OPA) and accepted, with some revisions, by the Ontario government. The province has set targets that will double energy efficiency through conservation and double the amount of energy from renewables by 2025.

In directing the OPA to proceed with its plan, Energy Minister Dwight Duncan also accepted the findings of a June 9 report by the Independent Electricity System Operator (IESO) indicating that Ontario will need between 2,500 and 3,000 megawatts (MW) of additional capacity to maintain system reliability. This will mean further delays in the government's plan to phase out coal-fired generation completely and substitute this with cleaner sources of energy.

Consequently, OPA is being asked to address the question of how best to replace coal within the earliest practical period of time, and to recommend options for cost-effective measures to reduce air emissions from coal-fired generation.

"We remain committed to replacing coal-fired generation in Ontario," Duncan said. "We have made significant progress in reducing greenhouse gas emissions and ensuring cleaner air to improve the standard of living and quality of life for all Ontarians."

In addition, the government has directed Ontario Power Generation (OPG) to conduct feasibility studies for refurbishing units at the Pickering and Darlington sites, and to begin the work needed for an environmental assessment for the construction of new units at an existing nuclear facility.

The government will continue with a plan, announced in its 2006 budget, to establish a bio-energy research facility associated with the Atikokan station. It has also accepted the OPA's recommendation that natural gas should be used only to meet peak demand in high-efficiency applications and to meet local reliability need when no alternative is available.

The final plan is the product of the OPA's initial recommendations presented in December 2005, combined with input receive during consultation with the public, stakeholders, the electricity industry, the IESO and the OPA itself. Other features of the government's plan include:

- Planning to ensure adequate baseload electricity supply while limiting the future use of nuclear power to today's installed capacity level of 14,000 MW.

-Directing OPG to begin a federal approvals process, including an environmental assessment, for new units at an existing facility. Although the government prefers to use Canadian companies and technology, its first obligation is to the people of Ontario. Decisions will be made based on the best technology offered at the best price to Ontario ratepayers.

-Directing OPG to begin a feasibility study on refurbishing its existing nuclear facilities that will include a review of the economic, technological and environmental aspects of refurbishment. As part of this initiative, OPG will begin an environmental assessment on the refurbishment of the four existing units at Pickering B.

-Doubling the amount of electricity drawn from renewable sources, bringing the total to 15,700 MW by 2025.

-Doubling the conservation efforts suggested in the OPA's report, to reduce electricity demand by 6,300 MW by 2025.

-Expanding the transmission capacity from Bruce County and surrounding area to facilitate the transmission of electricity from several new wind farms and the Bruce facility to Ontario homes and businesses.

Ontario's 20-year Integrated Power System Plan is to be revised every three years and submitted to the independent Ontario Energy Board for review and approval.

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