Northland Power has won another judgment in its global adjustment dispute with the Ontario Electricity Financial Corporation (OEFC)
The Toronto-headquartered independent power producer announced April 19 that an Ontario Court of Appeal has confirmed an earlier decision by a Superior Court in favour of Northland.
Northland operates a natural gas generating station in Iroquois Falls and natural gas-biomass cogenerating stations in Cochrane and Kirkland Lake, along with other power stations in Ontario and in Europe.
The OEFC was established during the breakup of the old Hydro One to manage the legacy debt and other liabilities.
Originally Northland, and other power producers in Ontario, had applied to the court in relation to the interpretation of their power purchase agreements with the OEFC as it related to the price escalator for power sold under the agreements. The Superior Court ruled in their favour in March 2015.
Northland estimates its share of past and future lost revenue over the life of the relevant agreements would have been approximately $225 million, up from $200 million of a year ago.
If the OEFC chooses to do so, it can appeal to Supreme Court of Canada.
In a news release, Northland anticipates that its share of the remaining lost revenue from the period prior to the original decision – approximately $90 million including interest – will be paid in the coming months and rates under the contracts will be indexed according to the interpretation confirmed by the courts, consistent with the rates that have been applied since February 2015.
