IPPSO statement on limited extension of the rate cap March 21, 2003

For immediate release: March 21, 2003

Power producers encouraged by resolution of fixed price question

"The government's announcement today is an important and necessary step in re-establishing conditions for a healthy and stable market for electricity in Ontario," said John Brace, President of IPPSO, the Independent Power Producers' Society of Ontario. "We appreciate the government's recognition of the benefits that can come from a market-based system. We look forward to the continued evolution of the competitive wholesale market and to the restoration of retail market conditions by 2006."

"Power producers across the province are encouraged to know that further erosion of the market has been limited. It's a relief to know that the rules about the price cap are now firmed up, as uncertainty in this area prevents consideration of investment. You have to give the government credit for preserving the remaining integrity of the market. Active competition provides a framework for reliable supply and is the best way to ensure that consumers get the best possible prices in the long run."

"IPPSO is entirely behind the government's plan to distribute market power mitigation rebates on a quarterly basis. In fact, more frequent distribution of the rebate was something we recommended back in November as part of an alternative to the price cap."

"The important thing about today's announcement is that it sends a signal to investors and the power industry that the government believes in an open market. We are glad that the Ontario government has chosen to limit further erosion of the competitive market."

Brace notes that Ontario's competitive market demonstrated an ability to preserve reliability through extremely difficult summer and winter periods with record loads.

Brace stresses that building a competitive market is a long-term process. "We look forward to using today's announcements as a solid basis for working with the government and with other stakeholders on market evolution in order to create the conditions necessary for investment in new generation in Ontario".

IPPSO is a non-profit organization representing more than 100 companies involved in the generation of electricity in Ontario, including generators and suppliers of services, equipment and consulting services. IPPSO members produce power from co-generation, hydro-electric, gas, coal, nuclear, wind energy, waste wood and other sources. IPPSO's members currently produce over 90% of the electricity consumed in Ontario.

For more information, contact:
John Brace, President, 416-962-6262
Jake Brooks, Executive Director, 416-322-6549
Rob McLeese, Past President 416-366-4820

- 30 -

Independent Power Producers' Society of Ontario, PO Box 1084, Stn. F., Toronto, Ontario M4Y 2T7 Canada, tel. 416-322-6549 fax 416-481-5785 e-mail: ippso@ippso.org http://www.newenergy.org

For queries or suggestions, please forward to:

IPPSO, PO Box 1084 Station F, Toronto, Ontario, M4Y 2T7 Canada.
Street address: 163-C Eastbourne Ave., Toronto, Ontario M5P 2G5
(416) 322-6549 fax 416-481-5785 e-mail: ippso@ippso.org

Last update: March 21, 2003 URL: http://www.newenergy.org