Wynne faces questions about gas-plant cancellation costs

Premier Kathleen Wynne faced a barrage of questions at Queen’s Park on Tuesday about discrepancies between the provincial auditor general's findings on the cost of cancelling a power plant and the government's much lower estimate of that cost.

The auditor general just issued a special report that estimated the cost of cancelling a gas-fired power plant in Mississauga will amount to $275 million when all is said and done.

That was tens of millions more than the $190-million figure that the governing Liberals had previously stated. 

Opposition members hounded the premier in question period about why the government's prior information had been so off the mark.

Premier says latest assessment looks at 20-year timeframe

NDP Leader Andrea Horwath said that Wynne had been "pretty decisive" when she stated last fall that the relocation cost was $190 million.

The premier was asked if she still stood behind that information.

Wynne said the auditor general's assessment included an analysis of the costs and savings that will be incurred over the next two decades as the relocated plant is built and then becomes operational.

"The number is a different number and the whole purpose of the auditor general looking at these costs was to make sure that it was understood exactly what the costs were," she said.

The premier said she appreciated the auditor general’s work on the Mississauga file, as well as his ongoing probe of the costs of cancelling another power plant in Oakville.

Progressive Conservative energy critic Vic Fedeli called on the premier to "tell us now the total cost" of cancelling the Oakville plant.

In response, Wynne defended her efforts to be "open and transparent," which she said is why she asked the auditor general to "look at the Oakville situation."

Controversy has raged for months

The controversy over the cancelled gas plants in Mississauga and Oakville has dogged the government for months.

Just ahead of the provincial election in 2011, the Liberals said that if they were elected, they would stop the ongoing construction of the Mississauga power plant.

When the party then won a minority government, it followed through with that decision, though work on the plant continued for weeks while the Ontario Power Authority negotiated with the builder.

The Oakville power plant was scrapped the year before. Opposition members believe that its cancellation may cost hundreds of millions of dollars.

Outside of the legislature on Tuesday, Energy Minister Bob Chiarelli admitted that there are costs involved with the deal struck with the Oakville plant developer that will eventually add hundreds of millions of dollars to the total.

"The memorandum of agreement specified $40 million, (but) it also specified items such as price for power and the cost of the turbines," said Chiarelli.

"That is the information that we have, and we will let the auditor general do his work as he did on the other facility and wait for his report."

The legislature's justice committee also heard testimony Tuesday from a former secretary of cabinet who said the Liberals knew that the "sunk costs" associated with the Oakville plant exceeded $40 million — a figure the government had previously cited.

"There are buckets of costs, and depending on the structure of the final deal there's different buckets," said Shelly Jamieson, the former head of the Ontario public service.

"You will learn from this (Mississauga) report on what those different buckets are, and it doesn't surprise me at all that you'll see an analysis with the same buckets in the future report."