Ontario Power Generation turns a profit in third quarter, thanks to investments

TORONTO – Ontario Power Generation Inc. reports it had $139 million of net income in the third quarter, a turnaround from the $154-million net loss reported a year earlier.

The provincially owned electricity producer attributed the improvement to the performance of its financial investments, held on a long-term basis to fund the future decommissioning of OPG’s nuclear plants.

OPG’s revenue and output were virtually unchanged from a year earlier.

Revenue totalled $1.21 billion, down from $1.25 billion in the third quarter of 2011. The decline was partly offset by a smaller fuel expense, which dropped to $199 million from $217 million.

Total electricity generated during the three months ended Sept. 30 was 20.6 terawatt hours, compared to 21.4 TWh for the same period in 2011

“I want to note that the improved bottom line at OPG resulted from better returns on our invested funds that are held on a long-term basis to fund the eventual decommissioning of our nuclear stations, not from increases in prices,” said Tom Mitchell, OPG’s president and chief executive.

The fund set up to deal with closing power plants and managing nuclear waste recorded $161 million of earnings in the quarter, compared with a $16-million loss a year earlier.

There were also smaller improvements in other expense items including operations, maintenance and administration ($610 million vs. $634 million), depreciation and amortization ($164 million vs. $183 million) and “other” expenses ($9 million vs. $89 million).