Thank you, Mr. Chair, and good afternoon to all of you. Thank you for inviting S&C Electric to appear before this committee.
My name is Benoit Marcoux. I'm a professional engineer with over 35 years of experience in telecom and electric utilities in various executive and advisery roles. I am currently executive adviser on system reliability and sustainability at S&C Electric Canada.
S&C Electric is an employee-owned global manufacturer of electrical systems for utilities, headquartered in Chicago with a major plant in Toronto and offices throughout Canada. In 1909, over a century ago, the founders of S&C developed an extremely reliable power fuse to enable the safe operation of high-voltage transmission lines, heralding a new era in electricity. Those are the types of lines we're talking about with interties.
Ironically, over the last decade, S&C has implemented dozens of utility-scale energy storage systems throughout the world, allowing utilities to defer or even avoid investing in new transmission and distribution lines. This new reality is in stark contrast to the old utility grid. The old grid has large generation stations away from users, requiring long transmission lines to bring electricity to where it is being used. Those transmission lines often take 15 or 20 years from inception to operation, use vast areas of land, disparage landscape, and are generally opposed by local communities.
In the modern grid, electricity is being generated from renewable sources such as solar and wind, installed across the grid near the users of electricity. Energy storage systems accumulate electricity when the sun is shining or the wind is blowing, releasing it at time of use. Electric vehicles are charged during the day and can even give power back to the grid when needed. Distributed utility-scale renewable energy sources and storage make use of the existing grid assets, without the large environmental impact of transmission lines.
The reality of the new electricity grid stems from major investments and innovations made across the world in designing and implementing renewable generation and energy storage systems, including electric vehicles. As a result, the price of renewable sources and energy storage technologies is decreasing rapidly, at double-digit rates per year, and they are getting increasingly competitive as the industry scales up manufacturing and learns how to better integrate those systems.
Wind, solar, and storage are not only becoming cost-effective, but doing so at a much smaller scale than traditional generation. Renewable generation and energy storage systems are therefore being installed deep in the electrical grid, at its edge or even behind the meters. The traditional and centralized grid is being transformed into a digital grid of microgrids integrated into local energy resources. In the same way that personal computers and the Internet replaced mainframe computers, the new grid of distributed energy resources is replacing the centralized old grid.
The new distributed and digital-enabled electrical grid is also more resilient to extreme weather events because it relies on multiple and alternate energy sources and paths. This new resilience is welcomed, as residential and industrial customers are increasingly dependent on electricity to power our modern life in smart communities and with the advent of electrical transportation.
What is even more dramatic is that those innovations are shaking a pillar of the Canadian economy. The electric industry touches every home and business in Canada, and reliable power is an essential ingredient for the competitiveness of our country. Electric power generation, transmission, and distribution utilities contribute almost $30 billion to the Canadian economy, with electrical equipment manufacturers contributing another $4 billion.
This industry employs more than 100,000 Canadians. Canada's net exports of electricity and electrical products amount to billions of dollars every year. The importance of the electric industry scales up the potential of wealth creation if the right investment decisions are made, but it also underlines the perils that we are facing. Should the Canadian electric industry fail to renew itself for the challenges of the 21st century, the entire economy of Canada could suffer.
Canadians should be inspired by how other countries are building this new electricity grid. For example, a utility-scale storage system at a substation in Leighton Buzzard, 50 kilometres outside London in the United Kingdom, allowed the utility there to avoid building a 20-kilometre underground transmission line. With this technology and others, as well as a regulatory regime that incites the utilities to perform better, U.K. communities enjoy an electrical grid that is four times more reliable than Canada's.
In conclusion, accelerating the transformation of the Canadian electric industry is essential. In an industry traditionally defined by centralized generation and rigid geographic boundaries between utilities, new linkages need to occur—utilities and customers, vendors and entrepreneurs, cities and businesses—ensuring that all see the opportunities that didn't exist before and have the support they need to get their ideas to market quickly.
The transformation of the electric industry will ensure that Canadians benefit from the billions of dollars already invested in the electricity system. The structure of the industry will emerge transformed, with Canadian-owned service providers offering novel energy solutions across Canada, backed by a web of hardware, software, and professional service vendors. This will increase the opportunities for Canadians to export their energy, their expertise, and the fruits of their labour.
Now is a time for innovation in the electric industry, like no other since Thomas Edison. Now is the time when wealth can be created as we use our collective resources and brains to ensure a resilient and sustainable energy future for all. Let's make collective investments in an infrastructure that is built for the next century, not for the last one.
Thank you.