The facility will be set up in the town of Greater Napanee in eastern Ontario near Ontario Power Generation’s Lennox Generating Station property.

Construction of the new power plant calls for millions of dollars in investment, and it is expected to create an estimated 600 construction jobs.

The Napanee power generating station will act as a replacement facility for one that was planned in the community of Oakville.

The power plant will operate under a 20-year power purchase arrangement with the OPA that would generate stable earnings over the next two decades.

TransCanada president and CEO Russ Girling said the contract will allow the firm to move forward with its plans to provide a reliable source of electricity to Ontarians.

"We will take the necessary steps to ensure this is an environmentally responsible project and will also focus on the safety of the community, our employees and being a good neighbour," Girling added.

As of now, TransCanada operates the 683MW Halton Hills Generating Station in Ontario, has a 50% ownership in the 550MW Portlands Energy Centre.