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Penalty unclear after Bruce Power misses deadline to get nukes online

TORONTO, Cananda - The Ontario Power Authority said Wednesday it still doesn't know whether the privately run Bruce Power will pay a penalty for missing a deadline to restart two nuclear reactors last year.

The NDP complained in the legislature that the government had allowed Bruce Power off the hook and didn't impose a penalty that the party claimed would have saved electricity ratepayers up to $500 million a year.

Both the government and Bruce Power disputed that number calling it "wrong" and "inaccurate," and the New Democrats were later forced to admit they couldn't support that figure, which NDP energy critic Peter Tabuns admitted he'd taken from an old newspaper article.

The OPA is still working through whether Bruce's delay last year in getting the refurbished units back online was all attributable to an equipment problem, said OPA vice-president Kristin Jenkins.

"Under the contract, Bruce won't be paid for any delay that is not associated with fixing the equipment problem."

Bruce is contracted to provide electricity at 6.8 cents a kilowatt hour, but failure to meet its deadline meant the OPA was entitled to pay only about two cents a kwh, said Tabuns.

"If Bruce Power didn't deliver and the penalty was they were going to be paid the market price, not the contract price, there's a lot of money on the table," he said. "We have questions about it, but they aren't willing to answer those questions."

Energy Minister Bob Chiarelli said Bruce invoked what's known as a "force majeure" claim, stating that something happened beyond their control that caused the company to miss the deadline to get the reactors back on line.

"The OPA accepted the force majeure claim," Chiarelli told reporters. "The issue of where they arrived at in terms of a final number I don't have an answer for that. I can't speak to that ($500 million) number, but I believe there's a good chance that it's wrong."

Bruce Power said in an email that the figures quoted by the NDP were "inaccurate," but it failed to offer another figure, pointing only to newspaper articles from last year, one of which estimated the cost at $38 million.

TransCanada Enterprises, the company the Liberals promised to make "whole" when they cancelled a gas plant in Oakville at a cost of up to $810 million, is one of the major private sector partners in Bruce Power.

"TransCanada seems to be in a position to say whenever they have problems in Ontario 'make sure that we're covered. Keep us whole. Ratepayers, families they can cough up a bit more, but really we have to protect our shareholders,'" said Tabuns.

Earlier this week, the Liberals unveiled their new long-term energy plan, which included confirmation the province would go ahead with the refurbishment of six more reactors at the Bruce generating station near Kincardine, but without knowing the final cost of the massive project.

"Given the high cost and lack of transparency associated with the contract, can the premier offer any assurances to families and businesses worried about new costs and a lack of transparency," asked Tabuns.

Premier Kathleen Wynne punted the question to Chiarelli, who ignored it and lashed out at the New Democrats for opposing private power deals.

Chiarelli told reporters to check with the OPA, an arm's length agency the Liberals set up, for details on why Bruce Power did not face a penalty for not getting the two reactors in service on time.

The OPA said it determined that Bruce Power experienced an equipment failure that was beyond the company's reasonable control.

"The OPA is continuing to work with Bruce Power to finalize the force majeure claim," said Jenkins.

The Canadian Press

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