Canada’s Ontario government has unveiled plans for a series of new gas-fired generation stations aimed at replacing the five elderly coal-fired plants in the province as part of a government pledge to shut down the plants by the end of 2007. The coal-fired capacity currently supplies around a qurter of provincial capacity.

Two alliances will build two gas-fired plants near Sarnia with a combined capacity of 1,575 MW, effectively replacing the nearby coal-fired Lambton station. Calpine Corp and Mitsui & Co plan to build a 1,005 MW plant at a cost of C$500 million ($440 million), having already sold the plant’s output to the Ontario Independent System Operator. Given environmental approvals, construction of the three gas turbine and one steam turbine plant is expected to begin by December with commercial operations due in February 2008. Meanwhile, Invenergy and Stark Investments plan to build the 570 MW St. Clair Power plant also in Ontario.

The projects will require a C$1.1 billion ($887 million) investment, but are backed by revenue guarantees to mitigate against falling power prices over the 20 year term of the deals, an incentive deemed necessary to get the developments underway.

In a separate move, the Greater Toronto Airports Authority has announced a cogeneration project in Mississauga with a capacity of 90 MW and a project by Loblaw Properties will generate a further 10 MW.

The provincial government launched a request for proposals last June for 2,500 MW of new capacity and received 33 bids for 8,800 MW. Further announcements are expected.