Canada, flush with hydropower, seeking new markets
When the lights are left on in many Canadian houses, no one worries much. In cities such as Montreal, Toronto, and Winnipeg, electricity rates are so cheap compared with major cities in the Northeastern United States that it even pays to heat with electricity if you have a snugly insulated house.
A study by the federal government has found that in those three cities it would be cheaper to heat such a house with electricity than to use oil or even abundant Canadian natural gas.
Here are some comparisons of electricity prices per kilowatt-hour, with Canadian numbers adjusted to American money. Montreal residents pay 2.75 cents per kilowatt-hour and Toronto homeowners pay 3.4 cents. In New York electricity is 12.8 cents per kilowatt-hour; in Boston, 8.5 cents; and in Detroit, 8.6 cents.
There are two main reasons that most Canadians enjoy cheap electricity. One is political control. In every province, save Alberta, the utilities are provincially owned. The ratepayers can throw out the government if they don't like the price increases.
The other reason is that in some provinces, especially Ontario and Quebec, there is an overcapacity of electricity because of power stations and hydroelectric sites built to meet growing demand from Canada and export markets in the US. New demand for electricity in Ontario is off sharply. In the mid-1970 s Ontario Hydro estimated growth rates would be 8 percent or more per year during the 1980s. A new forecast says that demand for power will grow at only 2. 3 percent per year.
Canadian utilities have overbuilt and, because of poor planning and a vast oversupply of electricity, Canadian consumers could be facing massive increases in electricity costs as early as next year.
Ontario Hydro would love to sell more power to the US. It is already selling various states 11 million kwh. a year. ''We could increase that by 50 to 100 percent if we had absolute unlimited transmission capability,'' says Robert Tebo , an engineer in charge of Ontario Hydro's export sales to the US.
The tramsmission problems occur at the border, in this case mainly at Niagara , as well as in New York State. If one compares the electrical transmission system to plumbing, there is just not enough pipe to take the load. Building new transmission capacity is difficult, according to Ontario Hydro, one of the main reasons being that no one wants an ugly transmission tower going across his property. In both Canada and the US, hearings to put in new transmission towers spark long and politically acrimonious debates.
Ontario Hydro was to have built a high-capacity transmission line under Lake Erie to supply power to General Public Utilities of Pennsylvania. But the company canceled the contract, buying the power instead from Detroit Edison, and last June Ontario Hydro decided not to go ahead with the new line.
This leaves Ontario stuck with its excess generating capacity, a problem it partly shares with the neighboring province of Quebec. But while Ontario is separated from the US by the Great Lakes, Quebec has a long land border with the US.
In the past decade new transmission lines were built in Quebec to the New York State border and then through the state. The debate over the power lines even involved an item on the television program ''60 Minutes,'' with the local population saying they were ugly, dangerous, and reduced milk yields in cows.
But because of those transmission lines, Hydro Quebec, also facing a glut in electrical generating power, was able to announce last week that it has signed an agreement with 64 New England utilities to export more than $4 billion (US) worth of electricity over an 11-year period, starting in 1986. The deal involves 33 billion kwh. of electricity.
Last year Hydro Quebec sold 111 billion kwh. of electricity to the Power Authority of the State of New York.
Hydro Quebec overbuilt with the construction of its giant hydroelectric system at James Bay in northern Quebec. But the beauty of the Hydro Quebec system is that it runs totally on renewable water power. It uses no coal, and only a small experimental nuclear station. Ontario Hydro on the other hand uses about one-third water, one-third coal, and one-third nuclear.
Because of its surplus of electricity, the province Quebec is trying to attract energy-intensive industries to the province, especially those that need electricity.
Earlier this year the province managed to entice the state-owned French aluminum giant, Pechiney Ugine Kuhlmann, to build a $1.5 billion aluminum smelter on a deepwater site by the St. Lawrence River. The province gave the French company the guarantee of an ample supply of cheap electrical power. To convert bauxite to aluminum takes massive amounts of electricity.
It will cost the Quebec government about $125 million in electrical subsidy costs to attract the French aluminum company, but the province hopes it will be worth it in terms of jobs, which the area sorely needs. Because of rising electrical costs, countries such as Japan have just about shut down their aluminum smelting business. Quebec's cheap electricity could make it more of a world power in aluminum.