Tuesday, July 6, 2010
Twenty-two years ago this week (July 1988) I built a deck. I remember it vividly because it was an extremely hot and humid July week, even hotter than we are experiencing this week in the GTA. When I showed the deck to one of my work friends he commented that it was "overbuilt". I had used three nails where two would have sufficed, two bolts where one was adequate. The deck was solid, it still is. Now twenty-years later the pressure-treated wood has held up, and there are no squeaks, no weak areas, not yet anyway. I mention this because I'm certain their must be an engineering principle that requires infrastructure to be built beyond adequate tolerances, to be able to withstand unusual loads, stresses and demands.
Yesterday afternoon on the hottest day in more than two years a transformer fire caused a major blackout in a large portion of downtown and western Toronto. Yet another disruption in the life of Canada's biggest city that has economic ramifications for the entire region.
It took hours to get everything back up to normal but my first thoughts turned to Ontario's electrical production and is it able to cope with the unforeseen stresses that are inevitable? Is the grid "overbuilt" like any well engineered system should be? I don't think it is.
The lead editorial in today's Globe and Mail implies there is a problem with Ontario's electrical grid and production but it doesn't go far enough in pointing to a solution. Should the planning and production of electricity be left to the central planners at Queen's Park? Can central planners keep up with consumer demand for electricity? Should we trust central planners with the production of electricity? My simple answers are no, no, and no.
There are no truly free markets in the production of any form of consumable energy. There are onerous governmental regulations in oil, natural gas and electrical production, but while oil and gas production and distribution is taxed heavily, consumer prices do fluctuate based on supply and demand. Supply will be there when demand occurs. Not true with electricity, government sets the price and lately has made some questionable and uncompetitive deals with producers based on a slew of false assumptions. The problem is none of those assumptions involve your future demand for electricity and you should be concerned.