Mr. Speaker, just before
recess I was dealing with a question that was raised by the hon. member for Argenteuil (Sir George Perley) who had visualized the utilization of electrical energy for heating purposes. I had dealt for a few moments with the fact that in the city of Winnipeg that vision had already become a reality, and that we were now using electrical energy for the development of heat. During the recess I was asked by one or two hon. members to deal for a few moments longer with that particular matter, and without taking up too much of the time of the House, I wish, in
Georgian Bay Canal Company
order to satisfy the request made by the hon. gentlemen, to give a few more details in regard to that particular aspect.
In the development of any hydro-electric enterprise there is bound to be a large off-peak load which is like a by-product and is bound to go to waste. I do not think in the Dominion of Canada the average consumption over a twenty-four-hour period exceeds fifty per cent of the total quantity of electrical energy generated, the result being that there is a fifty per cent off-peak load that goes almost entirely to waste. It has always been a problem with electrical engineers how to utilize that waste in hydro-electric development1, and in the city of Winnipeg we have come as close as any other city to the utilization of that off-peak load or the by-product of hydro-electric development.
That has been effected in this way. In Winnipeg we were bound by circumstances to erect a stand-by plant for our hydro-electric system. That stand-by plant became necessary, as I believe it will become necessary in all large centres where large quantities of electrical energy are used, owing to the fact that at certain periods of the year cyclonic storms would blow down the transmission lines or there would be a stoppage from other causes, with the result that there would be very little or no hydro-electric energy obtainable in the city to carry on essential public utilities and works in factories such as packing plants and so forth. Hospitals would probably be without electrical energy; elevators in hospitals would be unable to run and so on, and the commercial life of the city would be completely demoralized for the time being. With the creation of a stand-by or auxiliary plant, as some people call it, we are able to give to a large section of the users of hydro-electric energy in Winnipeg a guaranteed twenty-four-hour continuous service.
The erection of such a stand-by plant involves a very large capital outlay as well as a large annual outlay for upkeep. One of the methods used to keep down that expenditure was the creation of a joint utility by combining with the stand-by plant a central heating system whereby the boilers, which are kept in readiness to generate electricity in case of emergency, can be utilized for heating purposes. What we do now is to generate heat through these boilers in the winter time; but in addition to that we have certain electric boilers, which are made in Canada, which were made by Canadian engineers, and the off-peak power which is on tap for many months in the year and for many hours each day finds its way into these 32649-61
electrical boilers. These boilers, which have a capacity of 750 horse-power and are not much larger than one of the desks in this chamber, generate steam which is sold in exactly the same way as steam that is produced by the use of coal. That brings in a large revenue to the city by using hydroelectric eneigy which otherwise would go to waste.
We have partly solved another problem which I believe is seeking solution in many other parts of the Dominion. More than one hundred of the largest buildings in the centre of Winnipeg are now supplied with heat from a central heating plant, and in the milder winter weather such as we have at the present time and such as they had in Winnipeg during February, not one ounce of coal is used for the creation of heat. The result is that in months where in other cities they have vast volumes of smoke coming out of their chimneys, Winnipeg is almost a smokeless city so that the atmosphere there possesses advantages that are not possessed by other cities. Moreover users of electrical energy in Winnipeg who find it essential to have a twenty-four-hour continuous service receive that by the creation of the stand-by plant which was put into operation, I believe, in 1924. I have endeavoured to make these one or two points clear for the bnefit of hon. members who asked me the question during the recess; otherwise, I had no intention of dealing again with the matter.
Coming back to the direct question of the bill before the House, another objection I have to it is the fact that if the charter is granted to the people who are seeking it there will be established in Ontario something which I believe will not be to the advantage of that province. It would mean for the province a dual system of private ownership and public ownership. Whilst I know that many hon. members will say that competition is a good thing, I believe an monopolies in certain things. I think the control of electric energy should be a monopoly and already in Ontario, 'the hydro-electric commission have a monopoly practically of this service which they give to the people. I think it would therefore be unfair of parliament to establish another system to enter into competition to a certain extent with the already publicly-owned utility of the province of Ontario. I have no doubt in my own mind that such a corporation should not come into competition, although I have an idea that if the power were granted to them they might hold up this charter and try to bargain with someone who would give them a good price for it. What is
Georgian Bay Canal Company
likely to be the result if a charter is granted? I understand that they could tap a region already not tapped by the Ontario Hydro Electric Commission. If they put into operation a hydro-electric system in the province, and then started supplying the people of those areas with electric light and power, I am satisfied that they would have to charge a much larger price than is charged to the people who use the energy of the publicly-owned utility of Ontario.
The 'hon. member for Nipissing (Mr. Lapierre), When speaking this afternoon, said the canal system would have to be carried by profits of the power operation. I noted that statement when he made it, and I think what he meant was that the promoters of the bill would charge the users of electric energy in the area they would serve, a much larger price than they would ordinarily charge, and would be able to put the canal system into operation by tfhe profits they would make out of the hydro-electric system. I think, Mr. Speaker, that is a very false position for any one in this House to fake. There is no canal system in this country which is now being paid for by a.ny auxiliary company. There are no canal tolls in effect at the present time, and it would be a mistake for us to give a company the right, as we would be doing under this charter, to charge more for electric liigjht and power in order that it might be able to subsidize a canal system which it has in contemplation.
Discussing the question of rates brings me again to the point raised by the hon. member for St. Antoine (Mr. Bell) the other night when he was speaking about rates. I think I asked a question in reference to the rates as between a privately-owned corporation and a publicly-owned utility, and he was good enough to reply by quoting from the annual statement of the company in which they said that t)he average retail rate in the city of Montreal was three and a half cents a kilowatt hour. I think that statement will be found in Hansard. If we take the rate charged in other cities where they (have hydro-electric enterprises under public ownership, we see quite a difference. The average retail rate charged in the city of Winnipeg, with which I am familiar, would not be more than two cents a kilowatt hour. Making all allowances,
I think the rates charged in Montreal are fully fifty per cent higher than those charged in Winnipeg. I believe, without having before me the actual facts, that the same ratio would apply to Toronto and other large cities. In that same connection, the hon. member was urging that the company known as the
Montreal Light, Heat and Power Company should be relieved of its annual income tax payment, amounting to slightly over three quarters of a million dollars; that it was an injustice to the company, and that they ought to be relieved of the payment, on the ground that a publicly-owned utility is not required to pay income tax to the national exchequer. The people of the province of Quebec have a simple way of equalizing matters; all they have to do is to own the utilities, as they do in Ontario; then they will have no tax to pay. That is one way of overcoming the difficulty, if they wish to do it. I do not think they should penalize a public utility because in Quebec they have private ownership. In this particular regard I want to quote a very brief synopsis of the statement made in the annual report of the company. I am quoting from the Financial Times of January 28th, and hon. members will see in what poor circumstances this particular company as. The report says:
Gross revenue from operations for the year 1926, is $18,907,382, compared with $18,346,806 for the year 1925, and $17,394,091 for the year 1924. A favorable feature is a reduction in operating expenses and taxes during the year.
My hon. friend from St. Antoine is not satisfied with the ordinary tax reduction, but he is willing to give them about three-quarters of a million in addition. *
The former being down at $7,109,918 from $7,349,243, and the latter down at $1,213,028 from $1,274,655, while appropriation for depreciation is up at $1,890,738 from $1,834,880.
But that is not all. I want to give the House a few more figures.
Net revenue shows a gain of over $800,000, at $8,693,688 as compared with $7,890,026. Respecting the issue during the year of $30,000,000 of bonds is an increase in fixed charges to $1,611,121 from $1,213,650.
And I think we know what these figures are. They are a melon cut for the shareholders.
Leaving net earnings available for dividends on the 2,041,837 shares of capital stock outstanding at $7,082,567, or the equivalent of $3.47 a share; this compares with net earnings of $6,676,376 for the year 1925, equal to 10.32 per cent, (or $3.44 per share figured on the basis of the recent 3 for 1 split).
I think we all have an idea what is meant by the three for one split, and this corporation split their shares three for one.
Dividends absorbed the sum of $5,135,041 as compared with $5,119,091 in 1925, and surplus for the year at $1,869,482, compares with $1,537,285.
Georgian Bay Canal Company
Now, Mr. Speaker, a public-owned utility does not publish balance sheets of this character, it does not split up shares three to one. Instead of paying cash dividends out of surpluses, the public-owned utility gives its customers reduced rates and better service. Therefore the people of Toronto and Winnipeg and other large centres where these publicly-owned utilities are operating get the benefit of rates which are about fifty per cent lower than those prevailing in, say, Montreal, and probably in other cities throughout the province of Quebec. But the communities where public-owned utilities are operating have a further advantage. Probably there is not a city on the North American continent where on the basis of population as much electricity is used as in Winnipeg. There we try to bring it into the homes of all the people. We try to make the lot of the housewife easier, and in the average household in Winnipeg you will find an electric stove and other equipment, all of which lightens the work of the housewife and improves the conditions of the home. I can say of my own knowledge that private ownership never displayed the initiative that is so conspicuous Tinder public ownership in the city of Winnipeg.
I have another objection to the bill. As a layman, I take it that the bill gives to the company a perpetual franchise. I believe there is a clause somewhere, perhaps in the old bill, which gives to the government the right of expropriation. I have some idea of what expropriation proceedings are, and I can understand how7 much a private corporation would demand for surrendering a perpetual franchise; the amount required would be staggering. So I cannot for the life of me see why we should give to a private corporation these valuable privileges and at a subsequent period buy them back for millions and millions of dollars. Undoubtedly the safest course will be to see that the promoters do not get a renewal of this franchise, and thus save ourselves the expense of expropriating their franchise at a later period. But I am asked by those who are sponsoring this bill, "Why not send it to the committee and discuss it there?" I do not see the reasonableness of myself and others who are opposed to the bill being required to go before the committee with our objections. I believe it is the safer policy to express my opinion now on the floor of the house and show where I stand, rather than wTait until the bill comes back from the committee after having received its second reading.
In dealing with this question I think we ought to take into consideration, Sir, the fact 32649-61J ,
that the legislature of Ontario is to-day discussing this identical question and, according to newspapers, a resolution is to be framed in such a way as to meet the wishes of all parties there-the conservative party, the liberal party, the progressive party and the labour party. They will all unite on a resolution asking this parliament to preserve the rights which belong to the province. In view of this we ought to pause a long time before we do anything which would in any way infringe on the rights of Ontario and give to a private corporation something which really belongs to the people of that province.
It has been argued by those who are promoting -this bill that the province of Quebec may give the water-powers on the Ottawa river over to private ownership for development. Well, if the government of Quebec favours private ownership development, that is the business of the people of that province. On the other hand, if the people of Ontario want to develop their share of these water-powers under public ownership, then they ought to be given the opportunity of doing so as part of their hydro-electric system. I believe that within the Liberal party there are quite a number of members who are in favour of the principle of public ownership, particularly those from western Canada. It is only quite recently that at a convention the Liberal party in Manitoba went on record as being in favour of the public ownership and operation of water-powers. I hope the Liberal members representing Manitoba in this house will fbllow the lead of the provincial party convention and help to uphold the principle of public ownership of utilities not only in Manitoba but in Ontario, for after all what is good in the one province is good in the other. I oppose this bill mainly on the ground that it is a complete violation of the principles of public ownership; further, I oppose it because I believe that the people of Ontario are anxious to retain these water-powers in order to develop them in the interests of the whole province. I believe, Sir, that when the interests of a small group of capitalists-of men who are attempting to exploit the people of Ontario and their rights-are opposing the interests of the people of that province, I as a member of this house must decide in favour of the people of Ontario.
I believe, Mr. Speaker, that this House ought aa far as possible to conserve the rights of the people in the development of their natural resources, and when we find that Ontario, through its premier, through the members of its legislature, and through other authorities in a position to speak, has expressed in most
Georgian Bay Canal Company
emphatic terms that it would be a great injustice to the people of Ontario if we renewed this franchise, it seems to me that the only course open to us is to see that this bill is not allowed to pass. It has been before the house on fourteen different occasions, and for thirty-three years its promoters have enjoyed the privileges and rights which they now seek to have renewed, but during all that time they have done nothing to carry out the project for which in the first instance the charter was ostensibly granted them. Therefore, Sir, I think we shall be acting in the best interests of the people of Ontario by rejecting this bill1 and thus allowing the provincial authorities to develop their own natural resources.