Ontario Struggles to Supply Electricity Demands
LCG, August 5, 2005--The Province of Ontario continues to struggle with supplying its demands for electricity. Yesterday, Ontario's Independent Electricity System Operator (IESO) extended its Power Warning, requesting customers to reduce their electricity consumption between the hours of 8:00 a.m. and 8:00 p.m. due to limited power supplies. Earlier this week, a combination of voltage reduction and customer conservation helped to maintain the reliability of the electricity grid.To provide additional power supplies to serve the regional demands, the Canadian Nuclear Safety Commission last week gave permission to Ontario Power Generation (OPG) to proceed with re-starting a 515-MW nuclear unit at Pickering A Generating Station, located east of Toronto. Unit 1, which was deactivated in 1997, could reach full power and be available for commercial operation by October of this year. Although Unit 1 will not address the immediate need for supplies, the reactivation will supplement long-term supplies.In July 2004, OPG received approval to proceed with the project, budgeted at $900 million, to refurbish and restart Unit 1. That decision was driven in part by the estimate that it could begin producing power in just 15 months - more rapidly than other alternatives - to support the government's planned closure of the coal fleet. The projected costs at the completion of the project are now estimated to be approximately $1.0 billion. Depending upon the success of restarting this unit, Ontario may give authorization to proceed with restarting the other two, deactivated units at Pickering A.The Ontario government had previously committed to close nearly 7,600 MW of coal-fired, generating capacity by the end of 2007 in order to reduce emissions and improve public health. In June of this year, the Ontario Ministry of Energy revised its schedule to shut down its fleet of coal plants and deferred the closing of the largest plant until early 2009.
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