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Canada

Canada

Canada under pressure

Many of Canada's electric utility monopolies remain under pressure from the US Federal Energy Regulatory Commission (FERC) to open their markets to competition. These utilities, which include Ontario Hydro and Hydro Quebec, rely on lucrative electricity exports to the US to maintain their profitability, but such exports are now at risk unless the utilities offer reciprocal and comparable service to US utilities.

The end of Canadian monopolies would allow customers to pick and choose their electricity supplier and open a market for green electricity, such as wind power. Opinion surveys have shown that many Canadian customers would pay a premium for green energy. In the most recent development, Ontario Hydro announced in August that it had established a US subsidiary "to take advantage of emerging export sales opportunities and expand its business in the US market." The subsidiary is known as Ontario Hydro Interconnected Markets Inc. But it appears the FERC many not be willing to grant Ontario the commission's crucial marketer licence until it ends its monopoly. In a judgement on an application from a Hydro Quebec subsidiary in 1995, FERC ruled that Hydro Quebec "must demonstrate . . . wholesale access to its transmission system," before a license would be made available. If it applies the same ruling to Ontario, the utility could sell only to utilities, brokers and marketers at the international border.

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