[Thunder Bay] City talks power plant purchase – by Kris Ketonen (Thunder Bay Chronicle-Journal – November 14, 2012)

The Thunder Bay Chronicle-Journal is the daily newspaper of Northwestern Ontario.

If plans to convert the Thunder Bay Generating Station to natural gas from coal fall through, the City of Thunder Bay would look into buying the plant, Mayor Keith Hobbs said Tuesday.

The province announced a hold on the conversion project, saying the Ontario Power Authority says the region’s energy needs can be met for much cheaper if the plant is shut down.

The OPA has yet to reveal its plans, but if they result in the plant’s closure, Hobbs said the city will examine whether it’s possible to purchase the plant and keep it running. “If we hear that that plant would be mothballed, I think that’s the time to go into those discussions,” he said from Toronto.

Hobbs was among a delegation who met with Energy Minister Chris Bentley in Toronto on Tuesday. The possibility of buying the plant did not come up, Hobbs said.

But the city has floated the idea at Ontario Good Roads Association and Association of Municipalities of Ontario confrences in the past.

“It’s still on the table as far as I’m concerned,” Hobbs said.

The government is phasing out coal-fired power generation in the province and wants to be off coal completely by Dec. 31, 2014.

Meanwhile, there is concern that if the Thunder Bay plant isn’t converted and stops generating power, the region’s energy needs won’t be met.

The plant generates about 300 megawatts of power, which critics say will be needed as the region’s mining industry grows.
Several new mines are expected to move into the production phase over the next 5-10 years. Overall power demand is expected to exceed 1,300 megawatts after 2016.

Meanwhile, the province has pledged to expand the east-west tieline, which allows power to be shipped to the region from southern Ontario when needed.

But that won’t be enough to meet power needs, the region says.

The idea to purchase the plant has the support of Thunder Bay Coun. Larry Hebert, former general manager of Thunder Bay Hydro.

“That’s something that we’ve put on the table before,” Hebert said at city hall on Tuesday.

“I think it’s an option (the government) should look at if they’re not willing to keep the plant open.”

Hebert said the idea also has the support of the Northern Ontario Municipal Association.

There was no official word on a possible cost to purchase the plant, but MPP Bill Mauro (L-Thunder Bay-Atikokan) estimated earlier that the replacement cost for the plant would be $1-2 billion.

Hebert said the Northwest Energy Association partnered with Texas Utilities in an attempt to purchase the Thunder Bay and Atikokan coal-fired plants from Ontario Hydro back in the mid-1990s for $200 million in total.

“Our bid got us in, at least, the door,” Hebert said. “Back then, we were going to continue to burn coal.

“They said ‘you’re going to have to convert it to natural gas,’” he said.

“That’s when Texas Utilities, who was really big in the coal business, pulled out.”

A representative of Ontario Power Generation, which owns the Thunder Bay plant, wouldn’t comment on a potential sale Tuesday.

He said that even with the conversion project on hold, some engineering work is still being done so that the project can resume quickly if the government decides to go ahead.

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