The Case for the St. Lawrence Power Project

MR. GRIFFIN: Members and Guests of The Empire Club of Canada: Our speaker today is Mr. Robert Hood Saunders, Chairman of The Hydro-Electric Power Commission of Ontario. Born in Toronto 48 years ago of United Empire Loyalist stock, he has pursued a remarkable career of public service in his native city. Between the time of his graduation from Osgoode Hall Law School and his entry into private legal practice in 1928, our speaker gained a broad financial experience in the banking field which was to be of great value to him in the years of public life that lay ahead.

In 1934 Mr. Saunders entered municipal politics where his career ran in an interesting series of fours. He was an alderman for four years, a Controller for four years and, as we all know, was elected Mayor of Toronto four times in a row.

During his fourth year as Chief Magistrate of the Queen City he was prevailed upon to accept the vital post of Chairman of The Hydro-Electric Power Commission of Ontario, which position he still holds. He has devoted himself wholeheartedly to this task at a time when Hydro was expanding as never before under the impetus of the tremendous growth in industry during the post-war period. Mr. Saunders last addressed this Club in January, 1949, when he reported to us on the great development that was taking place in Hydro. Today he is to talk to us on the greatest project of them all-harnessing the mighty St. Lawrence. I am told that Mr. Saunders possesses great ability as an amateur chef so I think he might have entitled his address today "What's cooking at Hydro".

MR. SAUNDERS: Mr. Chairman and Fellow Members--For the third time since assuming the Chairmanship of the Ontario Hydro, I have the honour of addressing the Empire Club. I can assure you that it is an honour I esteem highly, realizing as I do your prominence in the business and economic life of our Province. As you know, I welcome every opportunity of telling the great story of Hydro in Ontario-a story so thrilling that every one of us must surge with pride when we recall the stirring battle waged by Sir Adam Beck and his associates in turning a dream into a living reality.

Since I first spoke to you in March, 1948, I have travelled well over 200,000 miles in this Province by plane, train and motor car (incidentally over 90,000 of these miles by motor car)--It has been my privilege to visit every section of the Province-to sit down with local Commissions and discuss their problems at first hand--to visit towns, villages, farms, factories, mines, pulp and paper mills, industrial and commercial establishments in every part of this vast Province-I have been truly able to see and study Ontario at work.-I am convinced that the people of Ontario can look forward to a great and prosperous future. Nothing can stop the industrial growth of this Province but one thing-our own lack of preparedness.

Let us look back just 40 years. In a very real sense, gentlemen, Sir Adam Beck was an "empire builder". He envisioned Ontario as a great industrial empire, drawing its strength from a well-stocked reservoir of low-cost power. He saw Ontario as the centre of a great experiment, with every home and every farm brought within the reach of Hydro power lines-a place where the potential energy of falling waters could be harnessed to make a richer, better way of life for all. As we look back across the years and study the growth of our Hydro system to its present status of a billion dollar enterprise, with 1,132 municipalities welded together in a virile partnership, we realize the tremendous debt we owe to Sir Adam and those who fought at his side to protect the future of this Province.

We look back less than 40 years when Sir Adam was fighting to build the plant at Queenston (now The Sir Adam Beck No. 1 Generating Station). He was again seeking to protect the future of his Province--seeking to give the people of Ontario a higher standard of living let me quote a statement he made in 1923. "I am the servant of the people. My greatest joy is to make the lot of everyone within the range of my work and influence brighter and better. If I have helped to lessen the cares of the housewife by making electricity her servant, I have my reward. If I have helped the farmer to make life more attractive to the boys and girls on the farm, then I have not labored nor have you co-operated with me in vain. If I have helped to save the life of any afflicted child or lengthened the days of any afflicted, I am happy".

What a great contribution Sir Adam made to the people of this Province.

To our industries, homes on the farm and in the citylow-cost power in abundance.

Our whole economy has been revolutionized-we have changed from an agricultural Province to one of the foremost manufacturing centres of the world.

Back in 1933 the value of manufactured products
totalled -$ 958,776,858
In 1939 - 1,745,674,707
In 1945 - 3,965,069,021
In 1947 - 5,069,677,887
In 1949 - 6,359,820,550
In 1950 - 6,500,000,000 (estimate)

Increase in the value of manufactured goods over 1945 -63.9 percent.

Increase in Hydro's dependable capacity over 194540.9 percent.

These figures show in a very tangible way the tremendous and vital importance of electricity in the economy of this Province.

Sir Adam worried about our homes, in the city and on the farm.

Since 1945 our Domestic Consumption has increased by 97.4 percent.

Back in 1921 there were only 55 rural customers in Ontario served by some 6 miles of distribution lineBy 1939 we had 111,531 rural customers on 17,706 miles of distribution line-today, we are serving more than 310,000 rural customers over 36,300 miles of line.

In 1928, we sold power to farmers at 5.18 cents per kilowatthour. Now the average rate is 1.85 cents per kilowatthour. In 1928 farmers used an average of 96 kilowatthours per month. Now they are using 266 kilowatthours per month.

It will be seen that the cost of power to farmers during this period has decreased by 64 percent. That is, the cost of power is just over one third of what it was in 1928 and the average consumption by farms during this period has increased nearly threefold.

It is also interesting to note that the cash income from sale of farm products is now more than two and one half times the 1928 figure.

Yes, gentlemen, Sir Adam's dream has actually become a living reality-Electricity is the farmer's greatest hired man and actually does take the drudgery out of life. I have come to appreciate the indispensable role of electric power in spearheading Ontario's expansion. Electricity is the driving force that is carrying Ontario forward to new heights of achievement. There is no commodity as vital to our economy, our production, our employment--yes, our defence--as is electricity at low cost available wherever and whenever it is needed.

We have, with difficulty, been able to meet the demands of the past few years. Since the end of the war, we have brought into service over 1,112,700 horsepower. We are meeting the demand wherever and whenever it is needed. Your Hydro has tapped every economically available large scale generating site.

The demand is being met. But what of the future?

Our duty to the people of this province is to protect that future--to prepare for the tremendous power demands to come.

We believe that in completing our $880,000,000 postwar program of new generation, transmission, and transformation our province is protected until the end of 1956.

On October 26th next we hope to officially open the Richard L. Hearn Steam Plant at Toronto-eventually and by the end of 1952 or early 1953 this plant will generate 400,000 kilowatts (536,000 horsepower) at 60 cycles. In November next, we open the J. Clark Keith Steam Plant in Windsor--eventually and in 1953 this plant will generate 356,000 horsepower. In December, the first and second units of the Otto Holden plant at LaCave--eventually 257,000 horsepower. In 1954, we hope for 300,000 horsepower from Niagara with a further 400,000 horsepower in 1955-we anticipate soon commencing the second tunnel at Niagara to take care of 1955 and 1956. Yes, gentlemen, 1,112,700 horsepower since 1945, another 1,817,000 horsepower by the end of 1956.

This tremendous amount of power will be needed and actually in use by the end of 1956 and still no reserve for protection in case of low water, breakages or other conditions beyond our control. We must realize the tremendous demands made upon us and our great responsibilities to the people of Ontario-On just Tuesday of this week-we carried a primary load 386,315 kilowatts (415,086 horsepower) greater than on the corresponding day last year, an increase greater than the City of Toronto's average load, including Leaside, last year by 24,315 kilowatts or 32,420 horsepower. On Tuesday we carried a primary load which exceeded the same day two years ago by 682,233 horsepower, an amount greater than the combined Toronto, Hamilton and Leaside average loads last year.

I repeat--up to the end of 1956 has, we believe, been protected-

What of the future beyond 1956?

More power will definitely be needed--This province will not stand still-It is Hydro's duty to protect Ontario's future-to provide the power. Hydro, I assure you, will provide the power.

The real question is--Will Hydro supply low-cost power as it has in the past?--The answer is very definitely--Yes, if we are able to harness the falling waters of the St. Lawrence--if this right is not given, then, gentlemen, the power will still be supplied-but from steam plants at about 3 times the cost of production.

Every available large natural source of power, within economical distance, has been, or is now being harnessed for the benefit of the people of Ontario. Up to the present and for the next five years we shall be able to give our people power in abundance at low cost-just two weeks ago I was able to point out that the average domestic cost per kilowatthour (taking all municipalities) was 1.28 cents in 1938 compared with 1.04 cents in 1950 -a decrease of 18.75 percent; further, that this average cost would be lower this year and the estimated decrease compared with 1938 would be 19.24 percent-Right here in Toronto-the average monthly bill in 1938 based on 250 kilowatthour consumption per month was $3.78 compared with $3.02 this year, a decrease of 20.1 percent. Food during the same period increased in Toronto by 127 percent. The farmer today pays an average of 1.87 cents per kilowatthour compared with 2.52 cents in 1938 -a decrease over the 13 years of 26.7 percent.

Yes, gentlemen, your Hydro has supplied power in abundance at low cost-We shall supply the power in the future but to supply it at low cost depends on our right to develop the St. Lawrence.

Let us please all realize that the greatest single need in Ontario is the right to harness the falling waters of the St. Lawrence River.

As a citizen of this country I am convinced, after very detailed study over the past many years, of the great necessity of the seaway in relation to industrial expansion and the life of this Province. I subscribe to the statement made by William Lyon MacKenzie, the rebel of 1837 and the first Mayor of Toronto, that one of the aims of his provisional government was, and I quote, "the opening of the St. Lawrence to the trade of the world so that the largest ships might pass up to Lake Superior and the distribution of the wild lands of the country to the industry, capital, skill and enterprise of worthy men of all nations".

I subscribe to the statement made to this Club on November 3, 1910-41 years ago-by Major George W. Stephens, President of the Montreal Board of Harbour Commissioners. In one of his references to the St. Lawrence, Major Stephens said, and I quote: "In the possession of this great national asset, into which has gone the genius, the courage and the money of the Canadian people, Canada has unquestionably within her midst the cheapest and most efficient national trade route on this continent".

I have also studied Canada's ability to build the seaway and I am convinced of this, that Canada can not afford to continue without the deepening of the channels in the St. Lawrence River. In the interests of her own economic expansion and her own industrial expansion, Canada must have the St. Lawrence seaway. Therefore, I was indeed particularly happy to be told by our highly-efficient Prime Minister of Canada that he believes that Canada can and should proceed with the construction of the seaway--alone if necessary. As evidence of Canada's determination to get on with the job of making the St. Lawrence a reality, the Throne speech introduced at the current Session of Parliament heralded the setting up of a Crown company to handle this gigantic project.

But, gentlemen, important as the seaway might be, it fades into the background when one considers the tremendous importance of the St. Lawrence power project to the life of this Province. Our industry has been built on the basis of lowcost electric power in abundance. The extent to which electricity is used in our homes shows that the people of Ontario enjoy the highest standard of living in the world.

Per Capita Annual Consumption-1950
New York State - 1,986 kilowatthours
Pennsylvania - 2,286 "
Michigan- 2,404 "
Ohio- 2,766 "
Ontario- 3,933 "

Let us look at the Domestic Consumption exclusively

Average annual consumption (entire United States) 1,830 kwhrs. (increase over 1949-8.7%)

Average annual consumption - Ontario Hydro

3,640 kwhrs. (increase in 1949-15.8% )

These figures, recognizing the important role played by electricity, show in a very tangible way that the people of Ontario enjoy a standard of living unsurpassed anywhere in the world.

The vital question concerning Ontario Hydro at this time is "must we add to our steam generating facilities?"

This great question must be answered by your Hydro in the very near future. If assurance is not given to us within the next few months that we can go ahead with the St. Lawrence, then it will be necessary to build additional steam plants.

Yes, my friends, we are standing at the crossroads. We can provide power in abundance. But the question iswill it be lowcost power or will it be necessary to plan for steam power at three times the cost of hydro-electric power? Make no mistake about it, gentlemen, the pattern of our economy will inevitably undergo a change because that additional cost will have to be borne by the people of this Province and, particularly, by the people of Southern Ontario.

Examine for a moment the cost factors-

Under the terms of the St. Lawrence Agreement of 1941, in conjunction with the seaway, we can generate electrical energy at a cost at the plant of 2 mills per kilowatthour. Under the joint power scheme, which excludes immediate construction of the Seaway, we could produce electrical energy for three mills per kilowatthour. The St. Lawrence would provide us with 6 billion 300 million kilowatthours of electrical energy per year. Simple arithmetic tells us that St. Lawrence power could be supplied to the people of Ontario-to our industries, our homes and our farms-at a cost of 6 billion, 300 million times 2 mills or $12,600,000 per year at the plant.

The 1948 proposal, which provided for the building of the power development alone by New York State and ourselves, would cost 6 billion, 300 million times three mills or $18,900,000 per year at the plant.

If the St. Lawrence development is not allowed, this power simply must be supplied in some other manner, that other manner is steam.

We can obtain 6 billion, 300 million kilowatthours a year of dependable electrical energy through steam generation. But you can readily appreciate that this would not permit Hydro to continue its policy of providing low-cost power to our people.

Our steam experts have estimated that dependable power from an equivalent steam plant for the production of 6 billion 300 million kilowatthours per year would cost 7-1/4 mills per kilowatthour. Remember, gentlemen, that this threefold increase in cost would have to be passed on to you. Of this total cost, the fuel cost alone is estimated at 3.6 mills per kilowatthour which would require a purchase of 2,680,000 tons of coal annually at a cost of $22,700,000, which under today's conditions would come from the United States. What does this mean, gentlemen?

It means that the cost of power to our Ontario industries must, of necessity, go up, if the St. Lawrence development is denied us.

How would this increased cost of steam power affect your rates? To be able to answer this question, I have prepared costs of electricity in several of our municipalities with costs in cities of comparable size in the United States, cities which have to depend in whole or in part on steam-generated electricity. These figures will show you, folks, as they have shown me, how strikingly low is the cost of electricity in Ontario in comparison with these other centres. Gentlemen, we can hardly avoid similar high rates in Ontario if we are forced to augment our present power resources with more steam generating plants. Let's examine these figures

Average Cost per
Kwhr. to Consumers
Using Lighting, etc.
Refrigeration and
Cooking Based on a
Monthly Consump
tion of 250 K.W.H.

Let us not believe that this power will be surplusRemember, please, that our peak load carried in Southern Ontario alone last Tuesday was 3,015,684 horsepower. Compared with one year ago this load was greater by 519,323 horsepower-nearly one half of the 1,100,000 horsepower, our share of the St. Lawrence.

Hydro's motto--shown on our coat of arms reads "DONA NATURAE PRO POPULO SUNT"--The gifts of nature are for the people.

Surely it is a negation of Democracy to think that a few people, for their own selfish reasons, can prevent this great gift of nature from being used for the benefit of the people.

Two hundred and forty-six thousand cubic feet of water each and every second falling a harnessible 87 feet with a drainage area of 303,000 square miles-going to waste!

Gentlemen, we are extremely grateful to the Rt. Hon. Louis St. Laurent, to the Hon. Leslie Frost and their colleagues for cooperating with your Hydro in seeking to obtain for the benefit of our people this great gift of nature.

THANKS OF THE MEETING were expressed by His Worship, H. E. McCallum, Mayor of Toronto.