Ontario Energy Minister unveils plans to handle energy crisis

TORONTO — - TORONTO — The McGuinty government has unveiled a new vision for Ontario's electricity sector that will mean new supply, increased conservation and stable prices.

"This is an approach that will make up for over a decade lost in Ontario's electricity sector, and ensure Ontario's prosperity for decades to come," said Energy Minister Dwight Duncan. "We are putting Ontario back on solid footing by taking a balanced approach — one that addresses the critical need for new supply, increased conservation, consumers' desire for price stability, the importance of public leadership and the need for private investment."

In a recent speech to the Empire Club, Duncan said Ontario faces an energy crisis. It needs to refurbish, rebuild, replace or conserve 25,000 MW of generating capacity by the year 2020 to meet growing demand while replacing polluting coal-fired generation. That represents 80 per cent of Ontario's current generating capacity and would require an investment of $25 to $40 billion.

"For more than a decade, previous governments have been hamstrung by indecision and ideology," said Duncan. "They've clung to the old Ontario Hydro model, and tried moving to a fully competitive market, and neither has worked. And they've done virtually nothing to come to grips with our long-term supply needs."

To tackle these challenges, the government intends to propose sweeping reforms in legislation to be introduced this June. If passed, the reforms would include:

- A new Ontario Power Authority that would ensure an adequate, long-term supply of electricity, including a new Conservation Secretariat, headed by a Chief Conservation Officer.

- A requirement that the Ministry of Energy set targets for conservation, the use of renewable energy, and the overall supply mix of electricity in the province of Ontario.

- Greater encouragement of private sector investment in new generation to help meet growing demand.

- A combination of a regulated and a competitive electricity generation sector, which would see prices for electricity in Ontario set in two ways: part of the supply would be price-regulated by the Ontario Energy Board (OEB), and part would be paid the competitive market price. All consumers would benefit from the increased stability that this blended supply mix would provide.

- A new standard rate plan offered to homeowners and small businesses, with prices that would be adjusted and approved periodically by the OEB. This would ensure price stability while passing on the true cost of the electricity.

- Choice for industrial and commercial consumers, who would continue to have the flexibility offered by the market, or could use other tools to help them manage their energy costs.

- Minister Duncan also announced that the Honourable Jake Epp has been confirmed as chairman of Ontario Power Generation (OPG) effective immediately, and that the government is commencing a search for nine new members of OPG's Board of Directors, as well as a new Chief Executive Officer.

"We've chosen what we strongly believe to be the best approach, a balanced approach. It represents a real, positive change from the past, and a bright, more prosperous future."