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Setting Payment Amounts for Output from OPG’s Prescribed Generation Assets File number EB-2006-0064 TransAlta 110-12 th Ave SW, Calgary, AB T2P 2M1 Phone:

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Presentation on theme: "Setting Payment Amounts for Output from OPG’s Prescribed Generation Assets File number EB-2006-0064 TransAlta 110-12 th Ave SW, Calgary, AB T2P 2M1 Phone:"— Presentation transcript:

1 Setting Payment Amounts for Output from OPG’s Prescribed Generation Assets File number EB TransAlta th Ave SW, Calgary, AB T2P 2M1 Phone: Fax: TransAlta’s Presentation to the Ontario Energy Board September 15, 2006

2 2 TransAlta’s Experience with CoS, RC’s and Market-Based Investment –TransAlta was a vertically integrated utility with a monopoly service area, subject to a CoS analysis, and public review of same. –TransAlta had to change, as did the regulation of TransAlta. –TransAlta underwent a transition from a traditional utility to a competitive generation company, operating in both regulated contracts and market-based investment environments. –TransAlta believes that a similar transition will be required for OPG for the Ontario hybrid market to succeed.

3 3 Investor Confidence is Critical to the Hybrid Market As an existing Ontario generator/investor TA is concerned with: –OPG issues including New investment Mitigation of market power. –Market policy Ontario investor confidence requires more certainty, and stability. –Market issues How will OPG be incented and regulated with respect to its participation in the HOEP, DAM and forward markets? Level playing field – all generators should be governed in a similar transparent fashion.

4 4 Regulatory Contracts – Strengths and Advantages Regulatory contracts provide : –A balanced focus on all of the major cost, revenue and operational behavior issues which are key for customers and markets. –Customer protection – cost overruns are at the risk of the generator, not rate payer. –Public review of the major contract elements and procurement process can occur. –Flexibility to address market issues and efficiencies. –Investor confidence – investors understand the methodology and relative certainty of a contract. –A relatively level playing field between generators.


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