Value of Transmission | Electricity Canada

Overview

The electricity grid is often referred to as the largest machine on earth and was originally designed to transport electricity in one direction. High voltage transmission wires have served as the backbone of this system, enabling economies of scale in power production by transporting energy from huge central generating stations across large distances to areas where it is used. Electricity is then converted to lower voltages by power transformers, before finally being brought safely to households and businesses through smaller distribution wires. There are currently well over 166,000 kilometers of high voltage transmission lines in Canada, enough to wrap around the earth over 4 times.

A core part of electricity companies’ activities involves making sure that this massive machine remains intact, including periodically replacing poles, wires, and other critical components as they age. They must also constantly monitor and remove any potential sources of interference with this machine, including trimming trees and other vegetation.

As the electricity system has evolved, in addition to connecting electricity generators with electricity consumers, the transmission system has also come to serve an important role connecting provinces/territories with each other and with our U.S. neighbors. For instance, Natural Resources Canada (NRCan) notes that there are at least 34 active major international transmission lines between our two countries. These enable a host of technical, environmental, and other benefits, by allowing the transfer of electricity between our two nations.

We are once again seeing an expanded role for transmission. As our girds evolve to use more solar panels, wind turbines, and batteries, the ability to share energy between different regions is becoming more and more important. For instance, some of Canada’s best wind and solar energy resources are far from areas where it is used, requiring transmission to transport it to where it is needed. Also, solar, wind, and in turn battery storage, can be difficult to predict as wind and solar patterns can vary. In times when these energy sources fall short of expectations, importing energy from neighboring jurisdictions can be critical. Similarly, when wind or solar production is in excess of what is needed, it can be shared with neighboring jurisdictions to help meet their energy needs. Finally, transmission will also play an important role in terms of connecting our traditional, and newly emerging 24/7 sources of electricity like Small Modular Reactors, with the continental grid, enabling many jurisdictions to build more wind, solar, and other renewables, knowing that reliable backup power can be exported through transmission lines if needed.

History

The earliest electricity grids in the world emerged in the late 1800s and were primarily used to transport electricity short distances to power a limited set of technologies in large urban centers. As a case in point, shortly after inventing the first practical light bulb in 1879, Thomas Edison set to work developing the future electricity grid that would be required to power his invention, and in 1882 he installed the world’s first central steam generating plant in New York’s financial center that generated Direct Current (DC). At this time power was primarily used by businesses and others for lighting to attract customers.

Early electricity grids were also being developed closer to home. For instance, in 1881 the Niagara Falls Hydraulic Power and Manufacturing Company established a small hydro generation facility and provided some electricity to the village of Niagara Falls and the mills on the American side.¹ Later in 1895 the Adam No. 1, the first large-scale Alternating Current (AC) electric generating plant in the world, was built in this area with contributions from legendary electricity forefathers such as George Westinghouse, Nikoli Tesla and others.² This milestone is largely cited as being the beginning of modern grid operations as the use of AC current enabled the transfer of electricity for much farther distances than DC, with much lower line losses, and also enabled the use of more energy resources farther from load centers, such as hydroelectricity. The development of step-down power transformers to lower voltages around population centers also improved the safety of AC systems, which was the largest point of contention for proponents of DC (like Edison!).³ Today, the region is a major source of electricity for both Ontario and the New York State. In fact, 2,123 megawatts are produced at the Sir Adam Beck generating stations owned and operated by CEA member Ontario Power Generation (OPG). This is enough to power more than one million homes each year!⁴

As more appliances and electric motors were developed near the turn of the century that used electricity, demand for power increased beyond lighting, especially in applications such as street cars and industry.⁵ At this time many of the Canada’s power companies were small, privately held, and many went in and out of business.⁶ In the early 1900s as power use increased, hydropower stations became increasingly common, and some larger projects were commissioned at promising sites across the country that were farther from urban centers than was traditionally the case and used AC transmission and distribution systems to transfer electricity to population centers

Canada saw an emergence of large electricity, and particularly hydroelectricity projects in the first decades of the 20th century, and this was especially true in Western Canada where there was rapid economic and demographic expansion that required power. For example, Alberta’s first large-scale hydro project was commission by Calgary Power (now Electricity Canada member TransAlta) in 1911;⁷ and lower mainland BC’s first hydroelectric station opened at Buntzen Lake in 1903 with 27 kilometers of transmission to Vancouver.⁸

In the early 1900s there was a strong trend of transferring private power companies to municipal ownership particularly distribution systems. One of the most noteworthy events was the May 14, 1906, passing of legislation in Ontario that established the Hydro Electric Power Commission of Ontario (HEPCO), or later known as Ontario Hydro. Investment in generation was left to private parties, with Ontario Hydro having control over transmission in the province, and municipal control granted over distribution systems. Similar models were established across the country, and this set the stage for our modern grid. An example of this is the 1905 transfer of privately-owned Ottawa Light, Heat and Power to municipal ownership. This company would later become Hydro Ottawa and partner with HEPCO to be connected to the new Ontario provincial power grid.⁹

Our modern grid truly emerged after World War II as the Canadian economy boomed and increasing amounts of power were required. In many parts of the country, a combination of an inability to invest at the scale required (particularly in rural areas and smaller towns) and negative perceptions of incumbent power companies, pushed increasing levels of public investment in the power sector across the country. For instance, the Manitoba Hydro-Electric Board (MHEB), a precursor of Manitoba Hydro, was formed out of an amalgamation of other companies, guided by the belief the this would be the best way to provide the public with power.¹⁰

However, publicly owned power wasn’t the answer in all parts of Canada. In Alberta a 1948 plebiscite rejected public ownership of electric utilities by extremely narrow margins, with the ‘no’ side winning by 151 votes with a total of 279,831 cast.¹¹ This was a problem as fewer than four percent of Alberta farms had access to power in 1945. Instead, Albertan farmers formed co-ops, also known as Rural Electrification Associations (REAs) in their districts to pool funding for electricity distribution infrastructure, with the Provincial government provided the rest of the money via loans. While the REAs owned the power distribution infrastructure the power companies in Alberta generated the electricity and performed maintenance. This model was extremely successful with 87% of rural Alberta having access to electricity by 1961, and elsewhere in Alberta the choice for privately procured power has existed to this day with the government of Alberta never owning or operating a utility company.¹²

Whichever ownership and investment path was taken, the Canadian electricity grid essentially evolved along this basic centralized grid model for much of the next half century. That is, large electricity generators, using transmission and distribution systems, were most efficiently and cost-effectively able to transport power to end users.

Key Messages

“To achieve least cost carbon reductions, greater inter-provincial and international coordination on transmissions system development is critical.”¹³ – NRCan

“Increased electrification and renewable contribution resulted in higher transmission benefits as transmission enhances resource adequacy during both normal conditions and extreme events in these scenarios.”¹⁴ – NRCan

“Allowing international transmission expansion provides $10 billion to $30 billion (2018 $US) of net value to the continental system between 2020 and 2050 (…)”.¹⁵ – NARIS Report

“Interregional and International Cooperation Can Provide Significant Net System Benefits Through 2050.” – NARIS Report

“Operational flexibility comes from transmission, storage, and flexible operation of all generator types.” – NARIS Report