A contract would be finalized between TransCanada and the OPA based on the terms of the memorandum of understanding. All contracts are expected to be finalized by 14 December 2012.
The Lennox power plant near the village of Bath would act as a replacement facility for one that was planned in the town of Oakville in Ontario.
TransCanada president and chief executive officer Russ Girling confirmed the signing of agreement to build a power plant in Ontario.
"TransCanada looks forward to expanding our contribution of clean, safe and reliable power to the residents of Ontario," Girling added.
Minister of Energy Chris Bentley said, "Today’s announcement helps support Ontario’s plan to modernize the province’s electricity infrastructure, clean up the air we breathe and end the use of coal by 2014."
Currently, the Canada-based firm operates the 683MW Halton Hills Generating Station in Ontario and has a 50% ownership in the 550MW Portlands Energy Centre.
