By Sergio Marchi
Sometimes, we need to stop and assess what we take for granted.
Electricity is one of those things. We barely notice it’s there but it powers our lives at home and at work. And taking it for granted has serious downsides.
June has been designated “electricity month” for the last 3 years, so what better moment to reflect on “the great enabler” of modern society.
The fact is, we are at an inflection point. The decisions we make today – or fail to make – regarding our electricity system will have repercussions for generations to come.
That’s because Canada’s electricity assets are reaching the end of their lifecycle, which can range from 30 years for a utility pole to as much as a century for a power plant. Much of the system built a generation ago now needs to be replaced or refurbished.
Significant investments are needed just to maintain the reliability of what we have today. And when it comes to renewing electricity infrastructure, the lead times are long – often measured in decades.
Over the past decade, utilities have made investments of about $9 to $11 billion per year. However, according to the Conference Board, just to keep the system running will require some $350 Billion over the next 20 years, which translates to about $15 billion per year.
I fully appreciate that Canadians also have other expectations of their utility companies. They want them to be efficiently run. They want them to listen to their concerns. And they want them to provide value for money. I have no arguments about these legitimate consumer demands.
Naturally, I also understand that no-one likes paying more for their electricity. Homeowners don’t like it and neither do businesses. And when you have unhappy consumers, you have a perfect storm for political inaction, or years of relatively flat investment.
But looking ahead, new technologies like home battery storage, two way electricity flows, and electric vehicles will have an enormous impact on the electricity industry.
Prudence and forward planning require that we invest now.
And if we don’t? If we simply muddle along, kicking the can farther and farther down the road?
In that case, the consequences are clear – and significant. Disruptions caused by increased brownouts or blackouts could increase, especially given the increasing severity of our weather patterns.
That means less than reliable electricity. A loss in our ‘quality of life. Lost economic opportunities. And a less competitive economy.
This isn’t “chicken little” worrying – it’s clear eyed analysis. And if we are going to have a constructive and candid dialogue, we must consider all the potential consequences of our actions, or inaction.
In electricity, we have something that is indispensable to our modern life, which also contributes to a low-carbon future. Eighty percent of the electricity sector is emissions free.
It also comes to us at a relatively reasonable cost. For most Canadians, according to Statistics Canada, it amounts to about $3.59 per day – which is under 2% of household spending. That is less than what American ($4.65 Cdn ) and Japanese ($5.04) families pay.
Finally, we should understand our obligation to future generations.
Our forefathers undertook major infrastructure projects in building Canada. Think of the great railroads of the 19th century, or the highway, seaway and national broadcast systems of the 20th century. Throughout our history, we have invested in our ‘todays’ to ensure better ‘tomorrows’.
And each time we did, it was transformative – laying the foundation for economic prosperity for generations to come.
Today, I believe we are again at one of those moments. A time to build something important. Something enduring.
Let’s invest today for sustainable, reliable electricity tomorrow.
About Sergio Marchi