The story
The notion of generating electric power on the Niagara River was first entertained in 1888, when the Niagara Parks Commission solicited proposals for the construction of an electric scenic railway from Queenston to Chippawa. The Niagara Falls Park & River Railway was granted the privilege in 1892, and by 1900 it was using a dynamo of 200,000 horsepower (150,000 kW) which was the largest in Canada. Starting in 1899, several private syndicates sought privileges from the commission for generating power for sale, including:
the Canadian Niagara Power Company, backed by British investors
the Ontario Power Company, backed by American investors
the Electrical Development Company, backed by the Toronto Street Railway and the Toronto Electric Light Company (controlled by William Mackenzie, Frederic Thomas Nicholls and Henry Mill Pellatt)
By 1900, a total capacity of 400,000 horsepower (300,000 kW) was in development at Niagara, and concern was expressed as to whether such natural resources were being best exploited for the public welfare. In June 1902, an informal convention was held at Berlin (now Kitchener), which commissioned a report by Daniel B. Detweiler, Elias W.B. Snider and F.S. Spence, who recommended in February 1903 that authority be sought from the Ontario Legislature to allow municipal councils to organize a cooperative to develop, transmit, buy and sell electrical energy. The provincial government of George William Ross refused to allow this, and it was only after its loss in the 1905 election that work began on creating a public utility. During that election campaign, James Pliny Whitney (who would become Premier) declared:
The water power of Niagara should be as free as the air.
Creation of Hydro-Electric Power Commission of Ontario
In May 1906, the Hydro-Electric Power Commission of Ontario ("Hydro" or "HEPCO") was formed and its first commissioners were Adam Beck, John S. Hendrie, and Cecil B. Smith, HEPCO was a unique hybrid of a government department, crown corporation and municipal cooperative that coexisted with the existing private companies. It was a "politically rational" rather than a "technically efficient" solution that depended on the watershed election of 1905.
On January 1, 1907, referendums in Toronto and 18 other municipalities approved the provisional contracts that their councils had concluded with HEPC, and subsequent referendums one year later authorized utility bond issues for the construction of local distribution systems. The victories in Toronto were in large part due to the leadership and commitment of Adam Beck's ally, William Peyton Hubbard. The first transmission lines began providing power to southwestern Ontario in 1910. Berlin (Kitchener) would be the first city in Ontario to get hydroelectric power in long-distance transmission lines from Niagara Falls, on October 11, 1910.
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The commission's process of expansion was from municipality to municipality, generally in the following manner:
the municipal council would approach the commission, expressing its interest in establishing a local distribution system;
Hydro engineers would then visit the municipality to assess current facilities and probable total load, before producing estimates as to the total cost of extending transmission lines to the municipal boundary, the delivered price of power, and building or upgrading the community's distribution system;
if the council agreed, a provisional contract would be negotiated between the council and the commission, subject to ratification by the voters;
upon successful ratification, thirty-year debentures would be issued by the municipality to cover construction and equipment expenses, and Hydro would then build a tie line to the nearest point in its network.
During the 1920s, Hydro's network expanded significantly:
In September 1921, Hydro acquired the Toronto Electric Light Company and various railway interests, making it the largest electric power system in the world, and legislation passed in 1922 provided that any claims arising before December 1920 against the acquired companies or their properties, if not notified to the Commission in prescribed manner and pursued on or before October 1, 1923, would "be forever barred."
In 1921 and 1924, legislative amendments authorized grant-in-aid programs that encouraged rural electrification in Ontario by reducing unit rates in the areas to be served.
By the end of the 1920s, most remaining private power producers were unable to withstand any expansion by Hydro into their service area, and some survived only because Hydro did not see the need to enter their markets.
In 1926, the Ferguson government gave its approval for Abitibi Power and Paper Company to develop the Abitibi Canyon, the largest such development since the Niagara River, in preference to incurring more debt for Ontario Hydro. The development was encouraged through secret commitments for long-term purchases of electricity and indemnification of Hydro against any losses. Questions were asked at the time as to how the additional 100,000 horsepower (75,000 kW) in capacity would be used, as there were virtually no customers for it. When Abitibi was placed in receivership in 1932, legislation was passed over the following years to allow Ontario Hydro to take control of several Abitibi power developments. Certain dealings relating to the 1933 acquisition came to be known as the "great Abitibi swindle," which resulted in the fall of the Henry government in the 1934 Ontario election, to be succeeded by that of Mitchell Hepburn.
In 1939, the commission was given authority to regulate all other electricity generators, thus bringing all private utilities in the province under its supervision. It also received authority to acquire any utility that was not producing at its capacity.
In 1948, HEPCO changed most of its system from 25 Hz to 60 Hz. However, the Fort Erie area south of Niagara Falls stayed on the remaining 25 Hz generators until 1966, and this area had electricity throughout the 1965 Eastern Seaboard Blackout.
By the 1950s the commission was operating as a single integrated system. As demand rose in the post-war period, Ontario Hydro started expanding its generation system bringing on line many new hydroelectric stations. In 1953, Ontario Hydro began to interconnect with other utilities, the first interconnection being the Keith-Waterman line in Windsor which crosses the Detroit River to Detroit, Michigan interconnecting with Detroit Edison in the United States. This line was originally constructed at 120,000 volts and was later upgraded to 230,000 volts in 1973. Shortly thereafter, other interconnections with New York State were built. The first coal-fired generating stations in the system were also built in this period. The expansion of coal continued during the 1960s and 1970s but was overtaken by the development of nuclear power.
From Wikipedia’s article on Ontario Hydro, shared under CC BY-SA 4.0.4