Your Hydro Chairman Reports

HONOURED GUESTS, LADIES AND GENTLEMEN

This is one of the those occasions when it seems superfluous for me to spend more than a few moments in introducing our guest of honour, because Mr. Robert H. Saunders needs no introduction to any gathering of Toronto businessmen.

However, just for the records, which, as you know are published in our Year Book, I feel I should mention a few of the highlights in Mr. Saunders' career.

He was born and educated in Toronto and graduated from Law School in 1928.

After practicing law for some years he entered Civic politics, was elected Alderman for Ward 4 in 1935 and served in that capacity for several years.

In 1941 he was elected to the Board of Control and remained on the Board until 1945, when he ran for Mayor and was elected by a large majority.

Mr. Saunders was re-elected by acclamation in 1946 and was returned to office in 1947 and 1948 with record majorities.

On March l, 1948, Mr. Saunders resigned his office as Mavor and accepted the appointment of Chairman of The Ffydro-Electric Power Commission of Ontario.

In the light of subsequent events we know that he took over this important assignment at a critical time in the history of our vast Hydro Electric system.

The necessity for curtailment of electric power both in industry and for domestic consumption brought Ontario very close to a serious state of emergency and the new chairman of The Hydro Commission was confronted with a, tremendous public relations job, which I think we are all agreed he has handled with courage and great credit to himself.

Then, in answer to everybody's prayer that we be delivered from further blackouts, the heavens opened and the rains came down in time to avoid a more serious crisis,

Today Mr. Saunders is going to bring us up-to-date on the Hydro situation and doubtless give us some forecast regarding the future outlook, which I think is embraced in his subject "Your Hydro Chairman Reports."

I now have very much pleasure in introducing Mr. Robert II'. Saunders, C.B.E., K.C.

Mr. President and Gentlemen: I appreciate sincerely the opportunity that you have given me to report to the members of our distinguished club. It was just ten months ago I was privileged to stand in this place and make my first public statement as the Chairman of the Hydro Commission. Much has happened since that day. We at Hydro have really had our troubles-I was almost going to say "much water has passed under the bridge since we last met"-that would be treading on very dangerous ground, In fact, the water was just not there to pass under any bridge. We are thankful to a beneficent providence for sending rain and dropping it in the right places. I should, I believe, refer somewhat more in detail to our troubles during last fall.

Looking at our overall picture in Southern Ontario-some 60% of our power comes to us from plants located on continuous flow rivers, the Niagara and the St. Lawrence (through our purchases from Beauharnois). These plants, of course, are not affected by lack of rainfall. The other 40% of our resources are generated on rivers with variable flows by our Commission and our Quebec suppliers. Unfortunately the sharp and sustained increase in demand coincided during the fall of last year with a period of marked and probably unprecedented deficiency in rainfall and consequent river flow over a wide area of Ontario and Quebec and in the area supplying 40% of our power. This lack of rainfall caused in November last, a reduction of approximately 45 % in the deliveries from plants supplying that 40% of our power. The result--a reduction in the Commission's resources of over 17% below their normal dependable capacity.

Let us examine a few actual facts on the question of shortage

CHATS FALLS (Ottawa River)
Generation Inflow
Wednesday, K.W.H. C.F.S.
January 26, 1949 2,155,600 24,971
October 21, 1948 1,484,200 17,315
Deficiency due to lack of water 671,400 K.W.H.
BARRETT CHUTE (Madawaska River) Generation Inflow K.W.H. C.F.S. January 26, 1949 976,400 3,049
October 29, 1948 247,800 1,031
Deficiency due to lack of, water 728,600 K.W.H.
HEELEY FALLS (Trent River) Generation Inflow Wednesday, K.W.H. C.F.S.
January 26, 1949 276,340 4,723
October 21, 1948 190,160 1,720
Deficiency due to lack of water 86,180 K.W.H.
Total Deficiency due to lack of water 1,486,180 K.W.H.

These are a few examples of the effect of not sufficient rainfall in our own plants, What about our suppliers on rivers of variable flow?

Our contracts call for the delivery of 28,160,000 Kilowatthours per week from the Gatineau Company and 16,385,000 Kilowatthours per week from the MacLarenQuebec Company or a total from the two Companies of 44,545,000 K.W.H. per week. During the week ended November 16th, 1947, when the supply of water was favourable, we were able to purchase 31,464,200 K.W.H. from the Gatineau Company (3,304,200 above contract). During that same week in 1947, we were able to purchase from the MacLaren Company 20,468,000 K.W.H. (4,083,000 above contract), a total of 51,932,200 K.W.H. That was in 1947. What a change in 1948! During the week ended November 14th, 1948, we were only able to purchase from Gatineau 11,743,800 K.W.H. and from MacLaren's 10,836,000 K.W.H.--a total of 22,579,800 K.W.H. -21,965,000 K.W.H. less than the contractual figure--29,352,000 K.W.H. less than 1947-sufficient to take care of Toronto's present load for almost 6 days of the week. Why were these Companies short? Let me quote in part a letter received from the Gatineau Power Company dated September 14, 1948

"Confirming my conversation with Mr. Hambley this morning, we have to advise that we must further reduce our deliveries of power by 7,000,000 K.W.H. per week in view of the existing water levels in our storage reservoir. The situation becomes more and more critical each day the present takings are continued."

That, gentlemen, was the second letter making a total cut of 8,000,000 K.W.H. We did not then know it but there were two more letters still to come from Gatineau and one from MacLarens.

Those were certainly hectic days at Hydro. But such was the picture last fall in Southern Ontario.

We at Hydro endeavoured throughout to give the people actual facts. It was extremely difficult to gauge the future, Last October the Winter picture looked awfully grim, I assure you. Entering November there was no improvement. Why, on November 3rd we were forced to cut our direct "at-will" and "interruptible" customers by 2,729,490 K.W.H. That day, a Wednesday, we were only able to generate and purchase a total of 28,281,100 K.W.H. Compare that with 34,323,400 K.W.H. just one week ago today. Then the rains came and with the rains came increased power. The Gatineau Company was able to deliver more power. In October and the first part of November that Company was delivering 14,000,000 K.W.H. under contract-today its deliveries are some 6,500,000 K.W.H. under contract,

We at Hydro felt that it was our duty to give the people the benefit of every extra K.W.H. We increased Municipal quotas as often as it was possible, We endeavoured to give our people as much encouragement as was possible and within reasonable limits. No man can prophesy very far, into the future. In mid-December we were able to prophesy to the end of the year. The weather continued mild and the rain fell in the right places, Toward the end of the year we were able to prophesy to the end of January, Now we are able to say that the present deliveries to the Municipalities can continue throughout the Winter. This means that if we, and our Municipalities, continue to receive the same measure of co-operation from our people as at present there need be no more cut-offs this Winter. Generally across Southern Ontario we are able to carry the load over a six day and six night period. There may be Municipalities whose special circumstances such as a heavy industrial load, make this impossible but generally across the area we are able to carry the load over six days and six nights,

So much for the power picture. What about construction? The preparations that have been made for today's and future loads?

On March 25 last, I told you that I was very proud of my association with these men of Hydro. Today, with almost a year's experience I can repeat that statement with great emphasis, We, as citizens of this Province, can feel very proud of the men who have been and are in charge of the local Hydro Commissions and Public Utilities. Also of the men who have had charge of the Provincial Hydro -your own Hydro-Electric Power Commission of Ontario The Honourable George H, Challies, Ross Strike, K.C., R. L. (Dick) Hearn, our General Manager and Chief Engineer, Otto Holden, Bud Manby--yes, I could go on and on. They have done a wonderful job. For proof just look back over the past few years.

As we all know, during the war all essential materials and manpower were marshalled for Canada's all-out war effort--and rightly so--Additions to generating plants and construction of new generating plants were permitted only under Government control and allowed only when they could make an immediate contribution to the war effort, The capital construction budget tells the story,

In 1941 the estimate was $23,884,000. The construction forces were only able to spend $20,725,000 or 86.8%,

In 1942 the estimate was $18,989,000. They were only able to spend $15,664,000 or 82.5%.

In 1943 the estimate was $11,974,000. They were only able to spend $9,787,000 or 81.7%.

In 1944 the estimate was $8,808,000. They spent $6,582,000 or 74,7%.

In 1945 the estimate was $11,780,000, They spent $8,927,000 or 75.8%.

Unable to build, your Hydro Commission prepared for the future. The staffs prepared plans for post-war developments. Once war was over your Commission acted with amazing speed. On August 23, 1945, just 8 days after the Japanese surrender, an order was given to proceed with the immediate construction of the second unit at its DeCew Falls Plant near St, Catharines. (That new unit was opened in and has been operating since September, 1947). On September 20, 1945, just 36 days after the surrender of Japan, the Commission also commenced operations at its Stewartville Site on the Madawaska. (That Plant with its capacity of 60,000 k.w. (80,000 H.P.) is now operating. It was opened last fall). Yes, since the war, your Hydro Commission has been pressing forward with the greatest construction program in its history. With the direct object of meeting the power demands of today and of the future and fulfilling its proper role in the future development of every section of this Province,

In addition to the DeCew and Stewartville Plants, Hydro has completed a new Unit at Ear Falls and a new plant at Aguasabon, both in the North West section of the Province. It has put info operation the Frequency Changer and Transformer Station at Westminster (near London) to take care of the steam power from Polymer and future power from the new steam plant about to be built in Windsor. In addition, wonderful progress has been made at Des Joachims, on the Ottawa; Chenaux, on the Ottawa; the Tunnel project on the Missasagi and Pine Portage on the Nipigon. Survey work is being done at the LaCave site on the Ottawa. Let the financial picture tell the story since the war.

In 1946, the capital construction estimates were $32,363,166, There was still a shortage of men and materials, Our men were only able to spend $20,045,858 or 61.6%.

In 1947 the estimate was increased to $57,386,507. Our men were able to spend $46,094,835 or 80.3%.

Last year was the first year during the war and postwar periods when we were able to spend our budget.

The budget was $83,219,772--we spent $90,202,374. Yes, over 109% of the budget.

Since I last spoke to you, we have been spending on construction alone, well over $8,000,000 each month or over $262,722 each and every day including Sunday. Your Hydro, gentlemen, is forging ahead in spite of the shortage of men and materials. Speaking of men and materials, did you ever stop and realize the extent of our need?

At our Des Joachims Plant on the Ottawa, there are about 2,500 men working winter and summer. Right today and every day during the winter, regardless of weather, we are using over 7 carloads of cement, In the spring this will increase to 10 carloads each day. Remember--on this one job.

On that job we shall Dour 185,000 tons of concrete, just 26 times as much as was used in constructing this building (the Royal York). Something like 46 times as much as was required for the Canadian Bank of Commerce Building, acclaimed as the highest in the Empire. Yes, about 95 times as much as was used in constructing the Bank of Montreal Building at King and Bay Streets. 185,000 tons at Des Joachims; 90,000 tons of concrete at Pine Portage; 80,000 at LaCave--I could go on and on. Not only do we need cement but also almost every other type of material including an abundance of steel. Just imagine between October, 1947, and October, 1948, Hydro constructed 342 miles of high tension line, over 3,500 miles of rural line, and many many other works,

So much for the past, What of the present and the future?-Hydro today and has been for the past year, distributing the available power to all our citizens as equitably as possible, We believe that in the interests of the Province, we could not refuse new customers. Because of this stand many new homes have been built in our cities. Many factories have been built and the farmers have been encouraged as they should be, to stay on the farm. It was suggested that our rural program should he held up. Your Hydro Commission decided against this view.

To bring you up to date on the rural picture in Ontario, I should like to point out that from November 1, 1947, to December 17, 1948, 3,973 miles of new line were constructed and 29,965 new rural consumers given service. During the 1948-1949 fiscal year which includes that period from November 1, 1948, our program calls for the construction of 3,868 miles of line and the provision of service to 38,756 new consumers in the rural areas. The total number of all rural installations to date is approximately 220,000, consisting of 90,000 farms and 130,000 non-farms. When our 1949 program has been completed, this number will be increased to approximately 259,000, consisting of 106,000 farms and 153,000 non-farms.

An interesting feature is that at the end of 1948, the estimated percentage of the total number of farms in Ontario enjoying rural service was 53%, while this percentage will be increased by the end of 1949 to 62%.

When thinking of these extensions, let us all please realize that the increased load last year because of rural extensions was only about 23,000 H.P. against an increase caused by new construction in urban centres of well over 113,000 H.P. We shall continue to distribute the available power to all as equitably as possible. Only in this way will we not stifle progress in this Province,

Looking at the future, a load increase of approximately 100,000 kilowatts per year is anticipated. It is our hope that by bringing in small packaged steam units and diesel plants, together with purchases from the Detroit-Edison Company, to have sufficient power to take care of the load increase this year. We have already made definite arrangements for an extra 63,000 kilowatts by the fall of this year. Negotiations are now underway which will, we believe, increase that figure to 70.000 kilowatts (93,000 H.P.). For example at Hamilton different plants, 18,000 kilowatts. At Thorold, 15,000 kilowatts. At the Site of our Scarborough Frequency Changer Station, another 20,000 kilowatts. At Chatham, 10,000 kilowatts, and so on. In 1950, we expect at least one section of the Des Joachims Ottawa River Development will come into operation and possibly the whole 480,000 H.P. In 1951 the Chenaux Development on the Ottawa River will bring an additional 120,000 Horsepower and the Windsor Steam Plant at least 160,000 H.P. In 1952, the LaCave Development on the Ottawa River will bring in another 200,000 Horsepower. We contemplate and hope that permission will be given for the greater and more efficient use of the waters of the Niagara River which will give us another 400,000 to 500,000 Horsepower. We contemplate construction of a steam unit at Hamilton, Toronto or both. The ultimate size will depend to some extent on the outcome of the negotiations regarding the Niagara River and our prospects for the St. Lawrence. I think we all realize that the greatest single need for the future welfare of this Province is the development of the St. Lawrence. Here we have water flowing in great quantities, twenty-four hours of every day during the whole year-precious water to this Province and to the people of the United States which today is being wasted, We must, however, prepare for the future. We must obtain a sufficient reserve of energy to attract industry to this Province and to this Country and in looking to the future, the power of the St. Lawrence or its equivalent must be obtained. If not from the St, Lawrence, then we shall be obliged to go into the construction of additional steam plants. This of course, we have no desire to do because of the greatly increased costs involved but for the protection of our people, the power must be obtained. Our share of the St. Lawrence will give an average of some 6,000,000,000 kilowatthours per year, It is estimated that about one pound of coal would be required for each kilowatt hour or a total of 6,000,000,000 pounds. 3,000,000, tons annually, (one of the largest private electrical companies on the continent today uses 1.1 pounds per kilowatthour). On present estimates, the cost of power delivered at the power site on the St. Lawrence would be 2.6 mills per kilowatthour at 80 per cent load factor. On the other hand, the cost of generating steam power based on present prices and at 80 per cent load factor is estimated to be 7.7 mills at the plant. In other words, the St. Lawrence River project would, if completed, give us power at some 5.1 mills less per kilowatthour than steam units-or at about one third the price of steam,

Gentlemen of The Empire Club and visitors, let us please remember that there is no one single factor that contributes more to the community and industrial unity of this great Province than an efficient and well administered Hydro. We can readily visualize the hundreds of thousands of our people in homes throughout the rural and urban areas of this Province who commenced their way of life this morning with the use of electric power provided by Hydro. Whether it be the washing machine, the refrigerator, the milking machine, or just the lights themselves. We can further visualize the thousands and thousands of workmen who today passed through the open portals of the rapidly increasing industrial plants of this Province to engage in their individual daily work as related to their way of life, The plants are open, industry is virile--made possible by electric power, created by your Ontario Hydro.

(Applause.)