1. Managing Nuclear Power Stations for Success
Gregory Smith
Senior Vice President
Darlington Nuclear Station
Ontario Power Generation
to the
Canadian Nuclear Society
June 12, 2006
Toronto, Ontario

2. CONTENTS
OPG Nuclear Performance Update
Continuous Improvement Strategy
Challenges Going Forward
New Nuclear
Wrap Up

3. OPG Nuclear: 2005 Highlights
Darlington -- best performing multi-unit nuclear station in Canada; 2nd consecutive year
Four OPG nuclear units among 10 best performing CANDUS in 2005
Pickering A, Unit 1 returned to service
Pickering A receives Five Year licence from CNSC
Decision made not to return Pickering A, Units 2 & 3 to service
New Mandate negotiated with Shareholder
Pickering A and B
Darlington

4. Our Mandate Targets Nuclear Improvement
OPG Mandate
Our Mandate Targets Nuclear Improvement
Operate with a commercial focus
Improve performance -- emphasis on nuclear
Benchmark against the best
Expand generating capacity - hydroelectric

5. OPG’s Nuclear Performance is Improving
2003
37.6
76.4
8.4
0.91
81.5
111
2004
2005
Production (TWh)
42.3
45.0
Capability Factor (%)
80.4
83.8
Forced Loss Rate (%)
7.6
5.35
All Injury Rate (#/200,000 hrs worked)
1.25
1.06
Nuclear Performance Index
70.7
Event Free Day Resets 40 33

6. Decision not to Refurbish Pickering A, Units 2&3 was a Sound Business Decision
Consistent with our Mandate’s commercial focus
Refurbishing Units 2 & 3 was technically feasible…
…but commercially unjustified due to higher financial risk
Units 2 & 3 were in poorer condition than Units 1 & 4
Enhanced OPG’s credibility
Allows OPG to continue to improve performance at its 10 operating units
Pickering A (foreground)

7. People are the Key to Achieving our Performance Goals
Nuclear energy is a people intensive business. Improve the performance of the people and you improve plant performance
Pickering
Darlington

8. OPG has made Significant Progress in Improving Human Performance50
100
150
200
250
2001
2002
2003
2004
2005
Event free-day resets are a key HP metric
“Events” = human actions with negative consequences
Fewer is better
From 223 to 33 in four years – 84% reduction
223
153
111 40 33

9. OPG is Committed to Continuously Improving its Nuclear Operations
Maintain Focus on Excellent Safety Performance
Put People First
Improve human performance, leadership & productivity
Attract highly qualified young people
Improve material condition of the plant
Reduce forced outages through improvements in equipment reliability
Optimize planned outages
Reduce maintenance backlogs
Mitigate technological risks through comprehensive inspection & testing programs
Ensure availability of parts and proactively address obsolescence
Build Effective Leadership Behaviours

10. EACH STRATEGY IS COMMITTED TO IMPROVING
Each OPG Nuclear Station Has a Specific Performance-Improvement Strategy
Pickering B
Darlington “Navigator”
Path to Excellence
EACH STRATEGY IS COMMITTED TO IMPROVING
Human Performance
Station Reliability
Leadership Behaviours

11. Darlington
Maintain performance as Canada’s top performing multi-unit nuclear station through:
improved human performance
improved plant performance
leadership behaviours
Move to three-year outage cycle
Outage Work at Darlington, Unit 3
Human Performance - Station Reliability - Leadership Behaviours

12. Pickering B
Achieve and sustain 85% capacity factor and 5% forced loss rate by 2007
Complete inspection & maintenance of all fuel channels (SLAR)
Move to 40 day outages
Pickering B, Unit 8 Outage
Human Performance - Station Reliability - Leadership Behaviours

13. Pickering A
Continue to improve plant reliability through:
improved equipment reliability
preventive maintenance
reduced backlogs
Successfully manage safe-storage of Units 2 and 3
Feeder Tube Inspections at Pickering A
Human Performance - Station Reliability - Leadership Behaviours

14. Challenges Going Forward
Feeders
Supply Chain
Life Extension
Human Resources
Pickering B, Unit 6 Planned Outage

15. Feeder Tubes Anticipate replacement in planned outages
Mitigation strategies:
Inspections
Advanced Stress Analysis
Titanium Injection
Weld Overlay
Advanced Cut & Weld Tooling
Management strategies:
Advancing feeder replacements where beneficial
Aligning business plans with most likely replacement schedule
Three year outage cycle

16. Supply Chain Improve procurement engineering and purchasing
Improve materials planning and align with the outage and on-line work management processes
Implement process improvements to better align procurement with the safety significance of components
Maintain qualified supplier base for work programs

17. Pickering B (foreground)
Life Extension
Maintain Community Confidence/“Licence to Operate”
Complete Plant Condition Assessment for Pickering B in 2007
Begin Environmental Assessment process
Undertake safety reviews required by CNSC
Conceptual engineering for replacement of components such as:
feeder tubes,
fuel channels;
steam generators
Project plan and business case must be approved by OPG Board
Pickering B life-extension decision needed by 2008 to give time for engineering, planning, procurement
Pickering B (foreground)
Darlington

18. Strengthening Human Resources…because
OPG needs highly qualified employees to support operations and nuclear life extension
Workforce Demographics
over 30% retirements at OPG nuclear in skilled trades and technical staff in next 5 years
Life-extension/Refurbishment/New Build activity expected to increase in North America/worldwide
Intense competition for qualified people is expected
Pickering A, Unit 1, refurbishment

19. Strengthening Human Resources…through
Leadership Development
WANO programs
visits to high-performance plants
rotations and secondments
Leadership behaviours
delivering on commitments
acting with integrity
Recruitment
visible presence in the community, high-schools, colleges, universities
Darlington Employees

20. New Nuclear? New Nuclear is not part of OPG’s mandate
OPG sites could be considered as possible sites for nuclear new build
If shareholder asks, OPG would consider participating in new nuclear based on:
our expertise in earning regulatory approvals; operating nuclear facilities.
Bottom Line: “Performance Speaks for Itself”
Performance excellence key to participating in new nuclear

21. Summary: OPG’s Approach to Managing Nuclear Assets
Build exceptional human performance
Focus on understanding plant condition
Implement preventative, not reactive, maintenance
Move to shorter outages
Enhance inventory/procurement management
Plan ahead
Learn from others

22. Managing Nuclear Power Stations for Success
Gregory Smith
Senior Vice President
Darlington Nuclear Station
Ontario Power Generation
to the
Canadian Nuclear Society
June 12, 2006
Toronto, Ontario