Ontario Power Generation ordered to cut 'excessive' pension, benefit costs

The province's energy regulator has ordered Ontario Power Generation to cut $500 million from the compensation budget for its nuclear operations over the next five years.

In a decision released Friday, the Ontario Energy Board orders the province's largest electricity generator to cut "excessive" costs associated with pensions and benefits from its nuclear business' administration, operations and maintenance budget by $100 million a year until 2021.

The decision comes after OPG, in May 2016, asked for $16.8 billion from the board for a period between 2017 and 2021, a request that would ultimately lead to an increase in rates.

OPG says the request is intended to, in part, help offset the cost of a major nuclear refurbishment project at the Darlington Nuclear Station and the continued operation of the Pickering Nuclear Station past 2020.

The OEB's decision approves a request for $4.8 billion in costs related to the Darlington refurbishments and $292 million in fees associated with Pickering and says rate increase associated with the request will be retroactively effective from June 1, 2017.

While the final impact will be determined in early 2018, OPG estimated that its application would cost the average ratepayer an additional 65 cents a month over the five-year-period.