3-way split urged for OPG

- Ontario Power Generation Inc. should be split into three operating units, if not three separate companies, says the chief executive of the agency that runs Ontario's electricity grid.

Dave Goulding of the Independent Electricity Market Operator said recently the provincially owned company, which generates close to two-thirds of the province's electricity, is doing too many things under its current set-up.

Goulding's remarks after a speech to an industry audience, come weeks before a special committee headed by former federal finance minister John Manley is to file a report with the provincial government on the future of OPG.

Goulding said OPG's separate focuses include:

Maintaining and operating existing hydro-electric generating stations at peak efficiency.

Dealing with nuclear generation in Ontario. That includes deciding whether to complete the overhaul of the trouble-plagued Pickering A nuclear station, and deciding whether to construct a fleet of new reactors.

"I think it needs a particular, singular focus of mind in order to do that," Goulding said.

Dealing with the coal-burning generating plants that the new Liberal government says it will close by 2007.

Those are three very different tasks for OPG to face, he said.

"I don't think it's best served by trying to have the same corporate management and structure look at all three of those different focuses going forward," he said.

"It's better done by having different focuses on different parts of the company," he said.

"It can be done through corporate governance and structure, but from my perspective it's a big challenge to have one chief operating officer trying to look amongst all of those (focuses) and balance all of those different types of plates on the different types of sticks," he said. "At the very least, the whole management structure should change."

Asked whether OPG should be split into three completely separate companies, he replied:

"Splitting it up would be an option. It doesn't have to be the option, but I wouldn't rule it out."

Goulding isn't the first to suggest splitting up OPG.

An advisory committee headed by Donald Macdonald also advocated splitting OPG's nuclear, fossil and hydro-electric assets into separate units in 1996.

Manley's committee on OPG is due to report on OPG's future to Energy Minister Dwight Duncan in mid-March, but so far it has been secretive.

New Democratic Party leader Howard Hampton said in a recent interview the review is flawed.

"They invite in their corporate insiders who immediately go in camera and make decisions in the back room about what is really the public's hydro-electricity system."