Ontario faces $300M suit for cancelling power plant

The financing company behind the cancelled gas-fired electrical plant in Mississauga is suing the Ontario government for $300 million for breach of contract.

EIG Management, a Washington, D.C.-based investment company, is seeking an additional $10 million in damages in its suit against the Ontario Power Authority and the province.

EIG alleges it wasn't given any advance notice the project was being cancelled until Premier Dalton McGuinty made the announcement in the middle of last fall's election campaign.

The allegations have not been proven in court.

A statement issued Friday by Energy Minister Chris Bentley said the province would vigorously defend against the claims, but declined further comment because the case is before the courts.

Construction was well underway on the Greenfield South generation station in Mississauga when the Liberal government cancelled the plant, and work continued for weeks after the Oct. 6 vote.

The Saturday announcement by the Liberals, who were reduced to a minority government, was immediately met by Opposition charges they were trying to save Liberal seats.

Similar charges were levelled the year before when they cancelled another gas plant in another Liberal riding in nearby Oakville after activist Erin Brockovich joined local opposition to the project.