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OPG Update John Murphy Executive Vice President -- Hydro Ontario Power Generation to the NYPA/OPG Joint Works Committee Sir Adam Beck GS September 29,

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Presentation on theme: "OPG Update John Murphy Executive Vice President -- Hydro Ontario Power Generation to the NYPA/OPG Joint Works Committee Sir Adam Beck GS September 29,"— Presentation transcript:

1 OPG Update John Murphy Executive Vice President -- Hydro Ontario Power Generation to the NYPA/OPG Joint Works Committee Sir Adam Beck GS September 29, 2006

2 2 OPG Profile Generated TWh in TWh in first 6 months 2006 Produces approx. 70% of Ontarios electricity generation Employs approx. 11,000 employees Operates: Three nuclear stations (10 operating units, total) Five fossil-fuelled stations 64 hydroelectric stations Capacity: 22,173 MW (at end of 2005) Beck 2 GS Lambton GS Pickering B GS

3 3 OPG Generation Performance Electricity Production TWh Fossil Hydro Nuclear Q1-Q

4 4 OPG Financial Performance Net Income ($millions) $366 $342 $42 Q1-Q2 2006

5 5 Hydroelectric Profile RH Saunders GS Ragged Rapids GS

6 6 OPGs Management of Existing Hydroelectric Assets Independent benchmarking studies show plant performance and management systems are strong within the industry OPG is investing an average of $95 million per year to maintain and enhance hydroelectric capability OPG increased existing plant capacity by 400 MW since Further upgrades will add about another 150 MW by 2015 Graphs show number of OPG hydroelectric units in each quartile (Q) in their peer group. EUCG Benchmarking Results (2003) – Includes total of 764 units from North American utilities

7 7 Hydros Safety Performance Hydro has surpassed 1 YEAR (> 1.63 million hours) without a lost time accident. Other injury-free milestones: Niagara Plant Group – 2.8 years Evergreen Energy – 6.1 years Northwest Plant Group – 6.3 years Ottawa/St. Lawrence Plant Group – 5.8 years Some work centres have achieved > 11 years without a lost time injury. OPG received the Electrical and Utilities Safety Award Gold Award in 2005

8 8 Keys to Safety Success OPG and Hydro have established a high performance safety culture Safety more than just a top priority…its a core value Clear goals & objectives have been established Ultimate goal of Zero Injuries Visible commitment to safety…from board room to the shop floor Legislative compliance seen as the minimum standard Robust Safety Management Systems (based on OHSAS 18001) ensure continuous improvement Engaged employees Strong partnership approach to health & safety management Effective Joint Health & Safety Committees

9 9 Hydroelectric Supply Initiatives: Niagara Tunnel Sir Adam Beck GS No.1 Sir Adam Beck GS No.2 Sir Adam Beck Pump Generating Station Outlet Intake

10 10 Hydroelectric Supply Initiatives: Niagara Tunnel (contd) OPGs largest current capital project Diverts additional water to Beck hydroelectric stations 500 cubic metres of water per second 1.6 billion KWh average per year 10.4 km long Construction work underway Expected completion: late year life-expectancy Project is on schedule and within budget OPG is project manager Tunnel Boring began Sept 1 Niagara Tunnel Boring Machine, Big Becky

11 11 Hydroelectric Development Potential in Ontario OPG will pursue economically viable hydroelectric developments Theoretical potential ~ 12,000 MW Practical/economic potential ~ 5,000 MW Most potential sites are in Northern Ontario and are restricted by existing government commitments Key issues: First Nations participation Transmission requirements Restrictions on Northern & Moose Rivers development Environmental considerations OPG works with govt. agencies & stakeholders to address existing development restrictions, transmission constraints and environmental considerations.

12 12 OPGs Hydroelectric Development Projects in Northern Ontario Lower Mattagami River Development (450 MW) Replace existing 75-year Smoky Falls station with new larger station add a generating unit to each of three existing stations Lac Seul Development (12.5 MW) Construction underway --completion expected late 07 Upper Mattagami River Development (35MW) Replacing 3 existing old stations with 3 larger stations -- construction expected to start in mid 2007 Hound Chute Redevelopment Replace existing 95-year old station with a new larger (9 MW) station Other Projects Little Jackfish River Development (132 MW) Mattagami Lake Control Dam (5 MW) with Mattagami First Nation Long Lake Control Dam (5-6 MW) Abitibi River sites with Taykwa Tagamou Nation Lac Seul Construction Smoky Falls GS

13 13 First Nations Participation Active involvement by First Nations in hydroelectric developments includes potential equity participation. Recent OPG Agreements signed with First Nations, including: Mattagami FN Taykwa Tagamou Nation Lac Seul First Nation Long Lake #58 First Nation These agreements are critical to ongoing hydro-electrical operations and future hydroelectric development Mattagami First Nation Council and OPG representatives

14 14 Timeline of OPGs Existing Hydroelectric Projects

15 15 Timeline of OPGs Greenfield Hydroelectric Projects

16 16 Other OPG Supply Initiatives: Portlands Energy Centre Toronto needs extra 500 MW by 2010 PEC is a 550 MW high efficiency combined-cycle facility: co-generation capable fuelled by natural gas Located in Torontos Portlands area OPG/TransCanada Energy Ltd. are partnering to build PEC Environmental assessment and approvals in place Accelerated Clean Energy Supply contract signed with Ontario Power Authority Construction underway First power in 2008; fully operational by 2009 capital cost: approx. $730 million PEC: Artists Conception Site Clearing Underway

17 17 Nuclear Refurbishment In June, Ont. Govt. Directed OPG to Undertake feasibility studies re. refurbishment of units at Pickering B & Darlington sites Begin Environmental Assessment (EA) on Pickering B refurbishment as part of this process OPG is now assessing the business case for refurbishing Pickering B OPGs Plant Life Extension Project Division created in February 2006 On June 15, OPG submitted letter of intent and project description to CNSC re. potential Pickering B refurbishment EA for potential Pickering B refurbishment is proceeding as part of business case Business case study to be reviewed by OPG management and Board in 2008 Solid business case must exist before any decision to refurbish Pickering B (and eventually Darlington) is made Pickering B

18 18 New Nuclear In June, Ont. Govt. also Directed OPG to: Begin federal approvals process for new nuclear units at an existing facility Includes an environmental assessment OPG is developing plan of action to meet this directive OPG believes its Darlington nuclear site best location for new build Experienced workforce Best-performing multi-unit CANDU station in Canada in 2004 and 2005 Strong community support Room to build on site On Sept. 22, OPG filed application for a Site Preparation Licence for new nuclear units at Darlington formally starts the federal approvals process with the Canadian Nuclear Safety Commission Darlington Darlington Nuclear Generating Station

19 19 OPGs Fossil-Fuelled Stations Ontario Govt. responded in June to the Ontario Power Authoritys Supply Mix Report (Dec. 2005) The Govt. has asked OPA to determine how best to replace coal-fired generation in Ontario at the earliest possible time As a result…OPGs coal-fired stations to continue operating beyond 2009 OPG to meet all environmental regulations governing the operation of its coal-fired stations OPG will make additional, prudent investments in environmental equipment and systems to further improve environmental performance of its coal-fired plants Lambton GS Nanticoke GS

20 20 Lakeview Stack Demolition Lakeview Generating Station in Mississauga: in service:1961 capacity 1,140 MW lifetime output: 214 TWh 275 employees permanently shut down in April 2005 June 12, 2006: stack demolition Site now being cleared of remaining equipment Potential for future high-efficiency gas plant at the site

21 21 Earning the Trust and Confidence of our Stakeholders is Essential to our Operations Kakabeka Falls GS, 100 th Anniversary Open House Ontario Premier Dalton McGuinty at TBM Launch OPG receives Pickering 2005 Local Business Award

22 22 Summary OPG Priorities Going Forward Continuing performance improvement Contribute to Ontarios electricity supply through new power initiatives Focus on expanding and developing hydroelectric capacity Implement Ont. government directives on nuclear refurbishment and new build Operate coal plants efficiently and in an environmentally responsible manner until they are closed

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