TransCanada Energy reach deal to relocate power plant
- Ontario Minister of Energy Chris Bentley recently announced that the Ontario Power Authority has reached an agreement in principle with TransCanada Energy to develop a new 900-megawatt natural gas-fired power plant on the site of Ontario Power GenerationÂ’s Lennox Generating Station in eastern Ontario.
The location was selected to take advantage of existing transmission and gas infrastructure as well as the expertise of local workers. The plant is expected to be in service by the first quarter of 2017 and will provide 600 jobs during construction.
“[This recent] announcement helps support Ontario's plan to modernize the province's electricity infrastructure, clean up the air we breathe and end the use of coal by 2014,” said Minister Bentley.
The cost of TransCanada's plant at Lennox will be comparable to the cost of the original competitively procured Oakville plant. In addition, TransCanada will receive $40 million to cover the costs it incurred for goods and services that cannot be used at the Lennox site.
The OPA-TransCanada agreement has been formalized in a memorandum of understanding. OPA and TransCanada will now negotiate a contract based on the terms of that agreement. TransCanada will also finalize site-specific arrangements with Ontario Power Generation. It is expected that the contract and other arrangements will be finalized by December 14, 2012.
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Power producers sit on thousands of megawatts of underutilized plant, while consumers face frequent power cuts, both planned and unplanned.
Financially troubled generators struggle to escape insolvency proceedings. The state-owned banks that have mostly financed power utilities fear that debts of troubled utilities totaling 1.74 trillion rupees will soon go bad.
Aggressive bidding for supply contracts and slower-than-expected demand growth is the root cause. The problems are compounded by difficulties in securing coal and other fuels, high transmission losses, electricity theft and cash-starved distribution companies.
But India's 36 state and union…
