Ontario Power Generation

• 1. Introduction

  ›

  Ontario Power Generation, known simply as OPG, keeps the lights on for roughly half of Canada's most populous province. Every time someone in Ontario flips a switch, there is a better-than-even chance the electricity came from OPG's reactors, rivers, or converted coal plants. Yet despite that outsized role, OPG is not a private company chasing profit on an open market. It is a Crown corporation, wholly owned by the provincial government, and the price it receives for its electricity is deliberately held below the market average to keep household bills in check. How did a utility with that kind of reach come to exist? And what does it mean to run an organization that must balance nuclear waste, coal pollution, billion-dollar cost overruns, and the daily expectations of millions of Ontario residents? The answers begin in April 1999, with the breakup of a decades-old provincial monopoly.

• 2. Born from Ontario Hydro

  ›

  In April 1999, the Progressive Conservative government of Premier Mike Harris set in motion one of the most ambitious energy restructurings in Ontario's history. The plan was to privatize the assets of Ontario Hydro and open up electricity generation to market competition. From that breakup, five successor corporations were created, and OPG was the one that inherited all of the generating stations. In a single administrative stroke, OPG became the owner of nuclear plants, hydroelectric dams, and thermal stations spread across the province. The transition handed OPG a portfolio with enormous generating capacity but also the baggage of an aging infrastructure and costs that would soon prove difficult to control. The troubles surfaced quickly, and by the time a new Liberal government took office in 2003, OPG was already under fire for a spectacular failure at one of its most important facilities.

• 3. The Pickering Disaster

  ›

  In late 2003, the incoming Liberal government fired OPG's three most senior executives. The trigger was a report exposing that the refurbishment of a single reactor at Pickering Nuclear Station, specifically Unit 4, had come in significantly over budget and three years behind schedule. Management had underestimated the scope of the work and never completed a thorough analysis before the project began. The fallout did not stop with the executives. The government also accepted the resignation of the entire board of directors. To chart a way forward, an independent review committee was formed. Former federal Finance Minister and Deputy Prime Minister John Manley chaired it. He was joined by Peter Godsoe, Chairman of the Bank of Nova Scotia, and Jake Epp, a former federal Cabinet Minister who also served as interim Chairman of OPG. The committee was tasked with examining OPG's future role, its corporate structure, its governance, and the question of whether Pickering A Units 1, 2, and 3 were worth refurbishing at all. The eventual verdict on Units 2 and 3 was no; the business case simply could not be made. Unit 1, however, told a different story, returning to service in November 2005 with 542 MW of generating capacity.

• 4. Nuclear at Scale

  ›

  Roughly 60 percent of Ontario's electricity comes from three nuclear power plants: Pickering, Darlington, and Bruce. OPG directly operates Pickering Nuclear Generating Station in Pickering, Ontario, and Darlington Nuclear Generating Station in Courtice, Ontario. The Bruce Nuclear Generating Station on Lake Huron, which runs on eight CANDU reactors with a combined 6,288 MW of capacity, is owned by OPG but operated by Bruce Power under a long-term lease. No fatal accidents related to nuclear power have occurred in Ontario. The Northeast blackout of 2003 did, however, expose a vulnerability: all but one of OPG's reactors tripped offline and were allowed to "poison out," a technical condition that prevents rapid restart and left the province waiting days for each unit to return to the grid. Behind the scenes, OPG also manages waste from its own 10 nuclear reactors and Bruce Power's eight, operating three interim waste management facilities. The longer-term plan is a deep geologic repository on the Bruce Nuclear site, designed for permanent storage of low- and intermediate-level radioactive waste from Bruce, Pickering, and Darlington. OPG started the regulatory approval process in 2005, and on the 6th of May 2015, a federal joint review panel recommended that the project move forward. In February 2016, the Federal Minister of the Environment and Climate Change paused the decision and requested additional studies, which OPG committed to deliver by the end of 2016. On the 2nd of December 2021, OPG announced a separate partnership with GE Vernova Hitachi Nuclear Energy to deploy a small modular reactor at the Darlington new nuclear site, the only location in Canada currently licensed for a new nuclear build, with completion targeted as early as 2028.

• 5. Coal, Conversion, and Controversy

  ›

  Before OPG cleaned up its generation mix, it operated some of the worst air polluters in the country. Nanticoke Generating Station on Lake Erie, with 3,900 MW of capacity, was North America's largest coal-fired station and the single largest source of air pollution for southern Ontario and northern New York state. OPG's Lambton Generating Station ranked as the second biggest polluter in Ontario. The Liberal government of Dalton McGuinty came to power in 2003 with a promise to phase out coal by 2007. For operational and demand reasons, that deadline proved impossible to meet, and the last coal was not burned until 2014. In the meantime, OPG converted rather than simply shuttered some of its plants. The Atikokan Generating Station in Atikokan, Ontario, was converted in 2012 to run on steam-treated wood pellets, a fuel OPG calls biomass, and the company describes it as North America's largest 100 percent biomass-fuelled power plant. The Thunder Bay Generating Station converted to an "advanced" biomass fuel in 2014, described as having higher energy density and the ability to repel water, allowing it to be stored outside. That Thunder Bay conversion drew sharp criticism from Ontario's Auditor General in early December 2015, who found that OPG was importing wood products from Europe to feed the station, pushing the cost of that electricity to approximately $1,600 per megawatt-hour, or 25 times higher than other biomass generators. Development and Mines Minister Michael Gravelle subsequently said OPG was seeking a local supplier. The salary of newly hired CEO Jeffrey Lyash added to the scrutiny that same year. Hired in the summer of 2015, Lyash was set to earn $775,000 per year, with potential bonuses pushing total compensation to $1.55 million if performance targets were met.

• 6. Hydroelectric Reach

  ›

  Across 66 hydroelectric stations, OPG draws on rivers from one end of Ontario to the other. The Sir Adam Beck complex on the Niagara River alone accounts for 2,100 MW of capacity, spread across two main stations and a pump-generating facility. Along the Ottawa River, plants at Chats Falls, Chenaux, Des Joachims, and Otto Holden contribute to a network that stretches into the province's remotest watersheds. The Mattagami River system hosts stations at Harmon, Kipling, Little Long, Lower Sturgeon Falls, Sandy Falls, Smoky Falls, and Wawaitin Falls. Smaller plants on rivers like the Otonabee, the Severn, the Trent, and the Muskoka add dozens more generating points. In 2018, OPG's hydroelectric fleet produced 29.8 terawatt hours. On the 25th of June 2019, OPG expanded that footprint significantly by purchasing Cube Hydro for $1.12 billion, a deal that added 19 hydroelectric power plants across New York, Pennsylvania, Virginia, West Virginia, and North Carolina.

• 7. Turnaround and Public Standing

  ›

  By 2005, OPG's finances had improved sharply from the depths of the Pickering scandal. Profits that year reached $366 million, and the company's credit rating was upgraded. In July 2006, Liberal Energy Minister Dwight Duncan called OPG's recovery one of the untold stories of the previous two years. The company also built a reputation as a corporate citizen. For four consecutive years OPG made the Corporate Knights Top 50 Best Corporate Citizens in Canada. In October 2008, Mediacorp Canada Inc. named OPG one of Canada's Top 100 Employers, with coverage in Maclean's. Later that same month, OPG was also named one of Greater Toronto's Top Employers, as reported by the Toronto Star. The company sponsors community events across Ontario and maintains wildlife trails in exclusion zones around its nuclear stations in Durham Region. Its annual employee charity campaign has raised millions for provincial charities. On governance, Wendy Kei became chair of the board on the 27th of June 2019. The current president and CEO is Nicolle Butcher, appointed on the 19th of December 2024 after her predecessor Ken Hartwick resigned. As of 2018, OPG generated approximately 74.0 terawatt hours, roughly half of all electricity produced in Ontario, from a fleet with 16,295 MW of total installed capacity. OPG also holds a small stake in Hydro One, having purchased nine million shares, representing 1.5 percent of the former Crown corporation, in April 2016, adding a connection to the province's largest electricity distributor.