Report points to mismanagement of Pickering A restart

Archived Release

Report points to mismanagement of Pickering A restart

Ministry of Energy

MCGUINTY GOVERNMENT TAKES ACTION ON OPG AFTER EPP REPORT QUEEN'S PARK, ON, Dec. 4 - Energy Minister Dwight Duncan today released the Report of the Pickering A Review Panel. The findings of the Report point to mismanagement of the Pickering A restart project by the Board and senior management of Ontario Power Generation (OPG), and the former Tory government. The Report, co-written by the Honourable Jake Epp, Peter Barnes, and Dr. Robin Jeffrey, catalogues a myriad of problems and notes, "given the size of the investment and the importance of the project, the Government as sole OPG shareholder, the Board, and senior management of OPG should have exercised greater oversight over the project's economics and execution and responded more quickly to emerging problems." Ontario Power Generation is a provincially-owned corporation, which, along with Hydro One, was created after the break up of Ontario Hydro in 1999. The Company is charged with managing and operating crown electricity generation assets. The four units at the Pickering A electrical power generating station were closed in December 1997 as part of a nuclear improvement program launched by the former Ontario Hydro. In 1999, the Board of OPG, under the watch of the Tory government, decided to proceed with the restart of all four units. At that time, OPG estimated that the total project would cost $1.1 billion, and that all four units would be operational by December 2002. At the end of September 2003, only a single unit, unit 4, was returned to service, and at a cost of $1.25 billion - triple the original estimate for that unit and two years behind schedule. The three remaining units are still out of service. "The contents of this Report are, in the words of the Panel, alarming," said Minister Duncan. "Today, our government is acting decisively to restore faith in the province's power generation, and to deal with this issue in a way that is transparent, responsible and in the best interests of Ontarians," the Minister added. In response to the Report, Minister Duncan has accepted the resignations of OPG's Chairman, Bill Farlinger, the CEO, Ron Osborne, and COO, Graham Brown. An interim CEO, Richard Dicerni, who currently serves as Executive Vice- President and Corporate Secretary of OPG, has been appointed. In addition, a Shareholder Resolution has been passed which limits the power of the Board and ensures that all major decisions are approved by the shareholder. "We will be reviewing the Epp Report and its recommendations in detail, and will make further announcements in the coming days," said Minister Duncan. "Determining the future of OPG is a critical element in shaping electricity policy, and we will take the necessary steps to ensure that Ontarians have a safe, secure and reliable supply of electricity." Disponible en fran├žais. www.energy.gov.on.caFor further information: Angie Robson, Minister's Office (416) 327-6747