The agreement is the first phase of a larger 1500 to 3000MW power sale that is currently under discussion by the two provinces. The announcement was made by Manitoba Energy, Science and Technology Minister Dave Chomiak, Ontario Energy Minister Donna Cansfield and Manitoba Hydro president and CEO Bob Brennan.

Chomiak described energy transfer as one of the single largest greenhouse gas reduction initiatives in Canada, equal to removing 500,000 vehicles from city streets.

The transfer will begin in 2006 with 150MW, increasing to 400MW annually as transmission upgrades come online to increase capacity between Winnipeg and Thunder Bay. The upgrades are expected to be completed in 2009, representing a doubling of east-west grid capacity at the Manitoba-Ontario connection point.

Concurrently, Manitoba and Ontario will continue to discuss the second phase of the initiative: a long-term clean energy transfer of up to 3000MW. The second phase would require the construction of new generating facilities in Manitoba, as well as new transmission infrastructure. At present, Manitoba has developed approximately half of its hydroelectric potential.

The provinces will continue to work with the federal government on financial support for the project.