Electricity
4.1. Chapter Summary

• The structure of the electricity sector has been evolving over the past decade due to policy and technological developments. A decade ago, vertically integrated monopolistic provincial Crown corporations relied on large generation facilities for the power supply. Today, in some provinces, more competitive systems have been adopted, with the private sector playing an increasing role, and many generation, transmission and distribution services have been unbundled.
• Electricity in Canada is generated from a diversified mix of sources. More than half of the electricity comes from hydroelectricity, which is especially important in Quebec, British Columbia, Ontario, Newfoundland and Labrador, and Manitoba because of favourable geography. Other key energy resources for electricity generation include, in order of importance, coal, uranium, natural gas, oil and non-hydro renewables.
• Canada trades a small proportion of its electricity supply with the United States. Exports amounted to $2.5 billion in 2006, while imports totalled $1.2 billion. Canadian utilities with hydroelectric storage capacity have significant export sales during peak periods, while jurisdictions such as Ontario depend on U.S. imports year-round.
• Electricity demand in Canada has grown at an annual average rate of 1.5 percent since 1990. The industrial sector accounts for the largest share of electricity demand, fuelled by the presence of some energy-intensive industrial activities. Residential electricity use varies across the country, because electric space heating, rather than natural gas, is used extensively in some provinces.
• Economic growth and the greater use of electrical appliances and equipment is expected to continue to drive electricity demand. Uncertainty about market rules, project-approval timelines and environmental regulations has dampened the investment climate for large capital electricity projects.
• Increases in Canada’s peak demand coupled with limited investment in new generation facilities have reduced reserve margins across the country over the past decade. Certain regions, including British Columbia and Alberta, will need additional resources in the near term to ensure adequate reserve margins. For many jurisdictions in Canada, however, forecasts indicate an improvement in reserve margins.