Subject: Offer of Power to Ontario
From: [email-masked]
To: [email-masked], [email-masked], [email-masked]
Cc: [email-masked]
Date: Fri, 24 Aug 2001 06:49:33 -0700 (PDT)

The Premier's Office and the Ministry of Energy have received John Lavorato's letter setting out the offer of 500MW from New York .  Judy Hubert  (Assistant Deputy Minister, Energy Policy) and her staff have been given the task of reviewing the proposal and concept.  Garrett Tripp and I spoke yesterday to Chris Cincar, an economist who works for Judy.  We reviewed the rationale for the proposal with Chris and made the following points: a) we see no supply adequacy problem even in the event Pickering A is delayed; b) the purpose of the proposal is to offer an insurance policy so that the gov't can firm up a market opening date of March 1 without any concern about Pickering; c) the prices in any transaction completed pursuant to the proposal or something similar would not set the pool prices in Ontario;and  d) we emphasized that this was power for delivery during onpeak hours only. Chris asked for some further data regarding historical NY prices for the March through June period in 2001 and prior years  and for a comparison of the onpeak prices with 7x24 prices. Chris is away next week and we will be speaking to him again after Labour Day. Chris indicated that he wants to talk about the proposal to the IMO and other potential power suppliers.  Thinking more about this, if in fact this is something Ontario pursues, Garrett and I think that the obvious  governmental agency to be the counterparty would be  OEFC, which will hold a wholesaler licence in Ontario.  OEFC could issue an RFP for the power required and secure the power from a range of suppliers outside the Province.