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OEA Energy Leaders Roundtable:OEA Energy Leaders Roundtable:

Nuclear Power PanelNuclear Power Panel P. Charlebois P. Charlebois

Chief Nuclear Officer Chief Nuclear Officer February 10, 2006February 10, 2006

Toronto, OntarioToronto, Ontario

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OPG’s mandate is to cost effectively produce electricity, while operating in a safe, open and environmentally responsible manner

• optimize hydroelectric production and expand or develop hydroelectric capacity independently or through partnerships

• operate in accordance with the highest standards of corporate governance, social responsibility and corporate citizenship

• operate nuclear stations cost effectively while prudently investing to improve their reliability, predictability and performance

Mandate and Strategic Objectives

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AccomplishmentsAccomplishmentsNuclear 2004 vs 2005 ResultsNuclear 2004 vs 2005 Results

Result Area 2004 2005Year over

Year Trend

Production (TWh) 42 45 Forced Loss Rate 7.6% 5.4% OM&A Costs (Actuals vs. Budget) ~6% below budget ~4% below budget Safety Good Good Regulatory Relationships Positive Positive

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Public Safety

OPG’s nuclear stations emit only a very small fraction of the radiation that the average Ontario resident receives each year from natural sources such as the sun, radon in the soil, etc.

0

1000

2000

Pickering Darlington Average annual exposurefrom natural sources

such as the sun

Microsieverts

1,770

0.61.6

Q2 2005

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Employee Safety: Accident Severity Rate

OPG nuclear employees have a lower accident severity rate than workers in the electricity industry.

0

2

4

6

8

Days lost per200,000

hoursworked

Good

PA PB D CEATop Quartile

(2002-2004 average)2005*

0.00

5.32

1.26

7.44

PA = Pickering APB = Pickering BD = Darlington

*Based on new CEA requirements, 2005 ASR was calculated using “calendar days lost” versus “shifts lost” used in previous years.

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Decommissioning / Waste Management

• The net present value of OPG’s liability for nuclear waste has been calculated to be $8.5 billion – to decommission the stations and to permanently store all nuclear wastes

• OPG has currently set aside $7.3 billion into a segregated fund towards this liability

0

5

10

TotalLiability

Amount inSegregated Funds

8.5

7.3

Billions $

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Waste Management Proposals

Deep Geological Repository(DGR) proposal

Nuclear Waste ManagementOrganization Report

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Nuclear Electricity Production

OPG’s nuclear production has been increasing over the past three years – partly from the addition of newly refurbished Pickering A Units 1 and 4, and partly from the increased production from Darlington and Pickering B

0

10

20

30

40

50

2003 2004 2005

TWh

3842

45

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Nuclear Production Efficiency

• The Unit Capability Factors of the Darlington and Pickering B stations have increased over the past three years

• In 2004 and 2005 Darlington was the best performing multi-unit nuclear station in Canada

• Four of the top 10 CANDU units worldwide are OPG units

0

50

100

UnitCapability

Factor(%)

69

83

70

8878

91

2003 2004

Pickering B

2005 2003 2004

Darlington

2005

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Nuclear Cost Performance

• Darlington is one of the lowest cost electricity producers of any nuclear station in North America, well into the top quartile compared to all nuclear stations in North America

• OPG’s nuclear stations produce electricity for a regulated price of 4.95 cents per kilowatt hour

• The market price for electricity generation in Ontario for 2005 averaged 7.2 cents per kilowatt hour

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Pickering A, Unit 1 Return to Service: Sound Project Execution

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Pickering A, Units 2 and 3 Decision : A Sound Business Decision

• Refurbishing Units 2 & 3 was technically feasible…

• …but commercially unjustified due to higher financial risk

• Units 2 & 3 were in poorer condition than Units 1 & 4

• Decision not to refurbish these units allows OPG to focus on continued performance improvement of its 10 operating units

Pickering A (foreground)

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What’s on the Horizon: Life Extension

• Life-extension decision on Pickering B by end of decade

• Planning process underway to determine scope and timing

• Business case must be approved by OPG Board and Ontario government

• Sustained performance and reliability key to positive outcomes

Darlington

Pickering B (foreground)

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What’s On the Horizon: New Nuclear

OPG will demonstrate its proficiency and capability in nuclear by continuing to enhance the performance and cost effectiveness of its existing operations

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What’s On the Horizon: Priorities

• Continue to improve performance in all aspects of operations • Continue to benchmark nuclear performance against the best • Complete placing Pickering Units 2 & 3 in safe-storage state• Meet our commitments • Focus on:

– performance excellence; – commercial success; – openness; accountability and transparency.

• Earn: – credibility and the confidence of our shareholder; – the trust of our host communities; – the pride and respect of our employees.

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OEA Energy Leaders Roundtable:OEA Energy Leaders Roundtable:Nuclear Power Panel Nuclear Power Panel

P. Charlebois P. Charlebois Chief Nuclear Officer Chief Nuclear Officer

February 10, 2006February 10, 2006

Toronto, OntarioToronto, Ontario