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A Brief History of the Electricity Industry in Canada

All electric utilities trace their origins to a single moment in 1882 when an incandescent lamp was set aglow by Thomas Edison’s Pearl Street electricity generating station. Within a decade, commercial coal and steam-generated electricity stations were supplying power for domestic and public lighting in communities across Canada. The rush to exploit Canada’s vast hydroelectric potential was also underway. Electricity was recognized as the new power source of the modern world.

Canada’s electric utility industry began as a loosely knit group of investor-owned operations spread across the country. As mass production and massive urbanization shaped 20th century Canada, the economics of electricity supply meant the gradual centralization of portions of the industry under "public" auspices, whether municipally, regionally or provincially. Canadian business legislation was shaped to support this fact. By mid-century, the electric utilities that became known as Hydro-Québec and Ontario-Hydro were among the largest in the world. And among the most admired for their scope in all facets of the electricity process that sheer size afforded.

At the outset of the twenty-first century the industry finds itself  in a period of unprecedented turbulence. Movement toward competition and industry restructuring continue throughout most of North America. However, the California crisis, the Enron debacle and the collapse of investor confidence economy wide have in turn undermined the confidence of policy makers and the public and progress will likely be halting for some time to come. These factors combined with rapid technological change, the need to address climate change and other growing environmental pressures create an atmosphere in which attracting needed investment is a very large challenge.

What seems clear is that Canadians will continue to demand from their electricity industry reliability, cost-effectiveness and steadily improving environmental performance. What will be essential is to ensure that the business and regulatory models that emerge over the next few years are able to assure these outcomes.