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Engaging Canadians in a Sustainable Electricity Future

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Engaging Canadians in a Sustainable Electricity Future Canadian Electricity Association ELECTRICITY 08 2008 - Volume 79 - Number 1 ENGAGING CANADIANS IN A SUSTAINABLE ELECTRICITY FUTURE www.canelect.ca Message from Don Lowry CEA Chair President and CEO, CEA’s Chair EPCOR Utilities Inc. Canada’s electricity sector is engaging in a wide-ranging public policy debate that will shape how power is produced, delivered and sold for generations to come. Table of Contents The debate touches on critical issues in environmental regulation, long-term energy security, Engaging Canadians in a economic competitiveness and infrastructure reliability. None of these issues can be effectively Sustainable Electricity Future . 3 addressed in isolation, and each one must be considered when planning how we will meet Canada’s future demand for electricity. Risk Management: The Key to Sustainable Both Canada and the United States are experiencing growing economies and rising populations, Resource Management . 9 with consequential increases in electricity demand. Canadians, for example, already consume 21% more power today than we did 15 years ago and our population is forecast to reach CEA Member 40 million by 2030. Projections in both Canada and the United States call for a 25% increase Utility Profiles . 14 in generation capacity by 2025. AltaLink . 15 As an industry, we have a strong record of providing power when needed and our goal is to ATCO Electric . 16 continue to do so in the future. But in many North American regions new power generation ATCO Power . 17 is not keeping pace with growth. Construction is lagging behind demand due to uncertainties BC Hydro . 18 about environmental policy and transmission availability, regulatory processes that are prolonged by ineffective stakeholder engagement, and the impact of rising costs and scarce BC Transmission Corporation . 19 supplies of labour, commodities and parts. Brookfield Renewable Power . 20 CEA’s member companies are working to address these challenges in a North American con- ENMAX . 21 text, and although there remains uncertainty about future environmental regulations we have EPCOR . 22 also recognized for some time that we are working in a carbon-constrained environment. The FortisAlberta . 23 debate is not about the merits of long-term reductions in greenhouse gases or air emissions, but over how quickly we can get there, at what cost and who pays. FortisBC . 24 In March 2008 the federal government unveiled an aggressive plan to reduce Canadian Horizon Utilities . 25 greenhouse gas emissions 20% by 2020, and 50% by 2050, and target further reductions in Hydro One . 26 air emissions. To help meet these goals the Canadian electricity industry has already made Hydro Ottawa Holding Inc. 27 substantial investments that reduce the carbon intensity of power generation. Manitoba Hydro . 28 As we make further investments in cleaner power generation and new technologies we believe Maritime Electric . 29 it is essential that policymakers align the pace of change with our trading partners so that Canadian businesses can remain competitive. The Canadian and American electricity New Brunswick Power . 30 markets are extensively interconnected, and share many issues in common. Making generation, Newfoundland transmission and labour constraints a North American concern makes sense from both an and Labrador Hydro . 31 economic and a political perspective. Newfoundland Power . 32 CEA has put forward a thoughtful and credible perspective, and the Association is an influ- Northwest Territories ential participant in the dialogue about the future of the North American energy supply. My Power Corporation. 33 focus as Chair has been on telling the story of Canada’s electricity industry, because we have Nova Scotia Power . 34 an interesting and progressive story to tell. Ontario Power Generation . 35 In this year’s publication you can read about the work our member companies are doing across Saint John Energy . 36 Canada to secure our high standard of living, support growth and improve our environment. I am pleased to have the opportunity to further the good work CEA has initiated during my Saskatoon Light & Power . 37 second year as Chair. In the year ahead, we will continue to engage member companies and SaskPower . 38 make progress on achieving CEA’s strategic goals. Toronto Hydro Corporation . 39 TransAlta . 40 Canadian Electricity Association, Electricity 08 is published by CEA to inform its TransCanada . 41 members on the activities of the Canadian electricity industry. Correspondence Yukon Energy . 42 should be addressed to the Editor, Electricity 08: 350 Sparks Street, Suite 907, Ottawa, ON K1R 7S8 CEA Environmental Tel.: 613.230.9263 • Fax: 613.230.9326 Stewardship Award . 47 Email: [email protected] • Internet site: www.canelect.ca Executive Editor: Francis Bradley • Editor: Brigitte Hébert CEA President’s Award Graphic design and production: Infoscan Collette, Québec of Excellence for Employee Électricité 08 est aussi disponible en français. Safety . 48 1 ENGAGING CANADIANS IN A SUSTAINABLE ELECTRICITY FUTURE Electricity has been a persistent issue on the public policy stage, fueling debates on its generation, transmission, distribution and pricing for well over a century. Coined the “People’s Business” by Tennessee Valley Authority head David Lilienthal in 1939, electricity has maintained its prominent image as a key contributor to the common good and a symbol of Canada’s prosperity, leadership and quality of life. Along with industry and governments, individual Canadians and communities have a long and rich history of involvement in shaping our electricity system and such a tradition is particularly germane today. Public understanding is an important factor of progress as the electricity industry adapts and transforms itself to meet increasing demand in a reliable, environmentally sustainable and competitively priced manner. Current issues such as those related to electricity infrastructure, energy efficiency, new technologies, regulation, the environment and security pose unique challenges to the industry, each of which is linked to public interest. As service providers, employers, benefactors, partners and members, utilities are intrinsically tied to the success and well-being of their communities, and thus uniquely positioned to improve and enrich them as well. Electricity is indeed the “People’s Business”, as much today as in 1939, though the urgency of relaying this message is reaching a critical point. As new generation, transmission and distribution infrastructure is required to ensure an adequate, reli- able and sustainable supply of electricity, industry and governments need to raise awareness, build acceptance and transform public understanding. People must be educated in what it takes to deliver the reliable and affordable electricity that is so often taken for granted. Moreover, the overall benefit of electricity as a key part of an energy strategy for the 21st century must be communicated for such a plan to be successful. Canadians need to be well informed of and prepared for the cost of clean, efficient electricity that can support our energy-intense lifestyle and economy. 2 3 TIME FOR LEADERSHIP ON Understanding the Infrastructure Challenge More Can Be Less A Climate of Opinion ENERGY EFFICIENCY There is a climate of opinion building around energy efficiency and this presents an important opportu- Canada’s electricity infrastructure is at the same crossroads as other physical infra- Canadians need to understand that more can be less in the long term, and that the nity for energy efficiency to become part of the In 2006 CEA joined with the Canadian Gas structure across the country: it is aging and requires replacement, refurbishment, interests of society as a whole must be the first consideration. A more expensive fabric of Canada’s energy framework. With direct Association and regulators from Ontario and Alberta and in some jurisdictions, it implies significant new construction. Historical demand system can increase reliability and result in less loss of economic activity. More access to consumers and their understanding of in the development of a series of workshops, trends and future electricity use projections signal the scale of investment that expensive electricity can be consumed through more efficient technologies local electricity consumption patterns utilities are designed to take place over a two year period to might be required to meet Canada’s electricity needs. Between 1990 and 2005, resulting in less increase on the customers’ bill. And a more modern and efficient uniquely positioned to deliver on the expectations explore the fundamentals of utility energy efficiency overall electricity demand in Canada increased by 24 percent, fueled in large part infrastructure will result in less environmental impact and less drag on the Canadian around energy efficiency. However, they cannot do programming and regulatory oversight of these pro- by a growing population, an expanding economy and greater use of electrical economy. All in all, getting the investment conditions right will help make Canada it alone. Effective coordination of policy, programs grams. Discussions centered on the experience to equipment. Despite improvements realized through energy efficiency and demand a destination of choice for long term capital and pay significant dividends in terms and regulatory efforts along with long term policy date in Canada, experiences from other jurisdictions, management, electricity demand is projected to increase by an annual
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