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Details of the Ontario Hydro Announcements may be read at
http://www.hydro.on.ca/OHWebSite/2f42.htm
These are the full details of the report that prompted the
announcements. For those who would like to just see the
pertinent press releases, there are two below that were made
to the Canda NewsWire regarding the resignation of OH CEO Kupcis
and the plant closures. I hope that this helps everyone
with the details.
Best regards
=================================================================
Source: Canada NewsWire
Attention News/Business Editors:
DR. ALLAN KUPCIS RESIGNS AS ONTARIO HYDRO CEO
TORONTO, Aug. 12 /CNW/ - Ontario Hydro today announced that Dr. Allan
Kupcis has resigned as President, Chief Executive Officer and a director of
the Corporation.
In his resignation letter to the Board, Dr. Kupcis stated - ``I am
resigning in light of the report of the Nuclear Performance Advisory Group and
their recommendations for recovering Hydro's nuclear fleet. The findings are
significant and the economic consequences severe.''
``Principally, the findings suggest that Hydro has endemic problems with
management culture. As the CEO, this is clearly my accountability, and this is
the principal reason why I believe it is time for me to step down. A new
President and CEO is required to lead Hydro through this recovery and into the
new era of competition which is about to dawn.''
``As disturbing as I find the consequences, I am very proud of the fact
that I commissioned the report. I commend its results to you.''
``I leave many friends at Hydro, and will be available to provide
assistance to the Chairman and the new President during this important period
of transition for the Corporation.''
Dr. Kupcis joined Ontario Hydro in 1973 as a Research Engineer and was
appointed President in March 1993 and Chief Executive Officer in January 1995.
Ontario Hydro has commenced a search for a new CEO. Bill Farlinger,
Hydro's current Chairman, will be interim CEO until Dr. Kupcis' successor is
appointed.
``Ontario and Ontario Hydro owe Dr. Kupcis a great deal,'' said Mr.
Farlinger. ``He showed great vision in developing and leading Hydro to its
position of supporting full, open market competition. He saw early on that
competition was inevitable and took as one of his major tasks preparing Hydro
for the future.''
``A key part of that preparation was identifying the need for Hydro to
become a more efficient operator, including nuclear generation which accounts
for almost two-thirds of our electrical production.''
``On behalf of the Board, I wish to thank Allan for his many
contributions and leadership, and wish him well,'' he said.
-30-
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Source:Canada NewsWire
ONTARIO HYDRO MOVING AHEAD ON MAJOR OVERHAUL OF ITS PRODUCTION FACILITIES
TORONTO, Aug. 13 /CNW/ - Ontario Hydro today announced that its board of
directors has approved a major overhaul of the Corporation's production
facilities in response to an extensive evaluation of its nuclear assets
conducted during the past few months by a team of experts.
Extensive upgrades will be made at the Bruce B and Pickering B units and
at the Darlington generating station over the next three years. As part of its
near-term plan, the A units of the Pickering and Bruce nuclear generating
stations will be laid up over the next year.
To replace the electricity production from the laying-up of the Pickering
A and Bruce A units, Hydro plans to run its Nanticoke and Lambton fossil
generating stations at higher levels, as well as bring back into service
mothballed units of the Lennox station.
``This overhaul will not affect rates. We will uphold Hydro's current
mandate to meet all the electricity supply needs of our customers,'' said
William Farlinger, Chairman and interim Chief Executive Officer. ``We are
determined to maintain appropriate margins of safety for our nuclear
operations and meet existing environmental standards for acid gas emissions.''
The financial implications of this overhaul are significant. Including
upgrading costs for nuclear facilities, replacing uranium with more expensive
fossil fuels and meeting other capital and operating requirements, Hydro's
financial position could be affected by between $5 billion to $8 billion over
the 1997-2001 period. In addition, there are other assets under consideration
for write-offs of approximately $2 billion in the 1997 fiscal period.
The evaluation of Hydro's nuclear assets was conducted during the past
six months by a team of experts led by G. Carl Andognini, Executive Vice
President and Chief Nuclear Officer. In all, 35,000 person hours of effort
went into the Independent, Integrated Performance Assessment (IIPA).
``The IIPA was brutally honest about Hydro's nuclear assets,'' said Mr.
Andognini. ``While the recommendations of the IIPA will result in
comprehensive changes to nuclear operations and have significant financial
implications, the team concluded that all plants are being operated safely and
that the public is not facing undue risk.''
Planned actions over the next five years include:
- The actions at the Pickering and Bruce B units and its Darlington
plant will include updating engineering designs and processes,
developing new management and organizational procedures, implementing
improved maintenance and work practices and providing extensive staff
training in all plants.
- Four units at Pickering A, and the three units at Bruce A, now in
operation, will be laid up, and the Bruce heavy water plant will be
permanently shut down. The timing of a return to service for the Bruce
and Pickering A units will be determined by Hydro's Board, based on
economic and market conditions.
- Hydro will replace the electricity generated by the Bruce A and
Pickering A units by operating existing fossil plants such as
Nanticoke and Lambton at higher levels and bringing back mothballed
units at the Lennox station.
The Independent, Integrated Performance Assessment (IIPA) was
commissioned in early 1997 by Dr. Allan Kupcis, former President and Chief
Executive Officer, as a result of the decline in the operating performance of
Hydro's nuclear generating facilities in recent years. The IIPA was conducted
using a rigorous methodology by a team of independent professionals and Hydro
staff.
The IIPA team ranked the Pickering, Bruce and Darlington stations as
``minimally acceptable,'' which is consistent with the rankings of nuclear
plants in the United States that would be permitted to continue operating.
The IIPA notes that corrective actions have already been taken in some
areas, and that a full action plan to implement all the recommendations is now
being developed.
The report also stated:
``The IIPA team confirmed that all of the (Ontario Hydro Nuclear) plants
were being operated in a manner that meets defined regulations and accepted
standards related to nuclear safety.
``To excel, (Ontario Hydro Nuclear) must transform itself into a world
class organization with a primary focus on operating and maintaining its
existing assets.''
The CANDU design provides Hydro with a robust technology with advantages
such as the use of natural uranium and on-line fuelling. The IIPA report says
that Ontario Hydro is in a unique situation to achieve success ``if the proper
actions are taken in a timely manner.''
``The management and cultural problems, identified by the IIPA, while
extensive, are not substantially different than the effort required to turn
around troubled plants.''
Copies of the report are available at Ontario Hydro's web site at
http://www.hydro.on.ca. lf you do not have Internet access, you can receive
the report by fax by calling 1-800-238-7718 and requesting story code 10860
-30-
For further information: Ontario Hydro Media Relations, (416) 592-3338
ONTARIO HYDRO has 60 releases in this database.
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