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'"Nor was there any provision in the Beaunarnois offer for the additional line losses and the cost of line main-- tenance involved in the transmission of power from the Beauharnois plant to the Gatineau line. This is a dis-- tance of some 101 miles. Physical |\ features are against the bringing of | power to Toronto from a plant within | 25 miles of the City of Montreal. The | Commission has a single circuit line from the inter--Provincial boundary, where it meets with the Beauharnois \ lines near the St. Lawrence River. |\ This line extends for a distance of t some seventy--five miles till it forms a junction with the MacLaren lines at the mouth of the Livre River, and from there goes on to Chats Falls. From Chats Falls the power is then transmitted for something over 200 miles to Toronto The carry is thus 301 miles, and the capacity of the line is at maximum, 150,000 h.p. The former Commission planned the con-- struction of a new steel tower high--tension transmission line from the Beauharnolis plant to the Citvy of Toronto, at a cast variously | of power from the East this current | month is $282,333.34. Had the old con-- ' tracts not been cancelled the charge : would have been $773,750.00. That is 'to say, we actually paid $491,416.66 \ less than we would have paid under 'twenty million dollars. The present | Commission has no intention of en-- l tering upon.any capital expenditure of ' that amount, in order to make avail-- ' able in Toronto power, the natural market for which is the City of Mont-- real. As the Beauharnois Company has now issued a writ and commenced action against the Commission, no further comment is necessary in this connection. "May I now endeavour to summar-- ize what these new agreements mcean. in actual finances, to the Niagara System. The Commission has actual-- ly been billed for power from the four Quebec Companies, for the year end-- ing the 31st of October, 1936, the sum of $7,936,892.70, for deliveries amount-- ing at the end of the year to 619.000 h.p. Next year we would have paid to these same companies $9,517,500 for a maximum of 706,000 h.p., at $15 per h.p. As already stated, our full supply is 140,000 hp., with a reserve sufficient for some years to come of 130,000 h.p., and this is provided at a cost of $3,.236,810.26, including all charges under the old contracts from the 31st of October until the 6th of December, 1935, when the former con-- tracts were cancelled. It will thus be cobserved that the saving in power purchased for this year 1936, is $6.-- 280,689.74. conditions as the Gatineau Company, but in the negotiations, the repre-- sentatives of the Beauharnois Com-- pany definitely refused any conces-- sions in respect to future require-- ments, stating that any equipment, the output of which the Commission did not immediately order and pay for, would be changed from 25 cyclie to 60 cycle. In addition to this, the Beauharnois Company specifically re-- served in its offer any rights it might have in respect to its former contract with the Commission. In other words, its offer was to sell power, and sue at the same time. "A graphic way to illustrate the dif-- ference between the actual cost of power under the new agreements and what it would have been under the old agreements is to compare the ac-- tual payments for the current month of February, 1936, with what would have been the cost had cancellation not taken place. "wlt & the old agreements. "But it must be noted that included in the payment actually made is the cost of 100,000 h.p. used at Thorold for the generation of steam. This commitment terminates on May 1st next, so that there will be struck from the payment of $282,333.34 the sum of $90,479.17, the cost of the steam puwer, reducing the payment for May, 1936, to $191,854.17. This is a little less than 25 pe°r cent. of what we would have paid under the old con-- tract. This is & saving of $581,895.83 The saving alone is three times the ammint We still pay. charge for the purchase mtolyt ae |__"A saving of half a million dollars a month is startling, and it will con-- \ _ "Owing to anticipated increases in | demand by the Commission's custom-- ers, it is expected that the cost of power from the Quebec Companies will amount in 1938 to $3,245,000.00, future growth is a matter of prophecy, or, shall I say, opinion. No one can look far into the future, but this much seems Clear beyond all peradventure, that the Commission will in the very near future be in a position to an-- | nounce a reduction in its charges o . power to the municipalities, in most 'subszamial amounts. In this con-- \ nection may I give the positive as-- !s! ance that it is the policy of this | Government to hand on to the power»-- 'users of our System such benefits as good management may warrant and l its couragsous battle against the ex-- Icessive and unjustificd exactions from the System may have secured. "In the year 1937 deliveries would have been completed under the old contracts for the full year, and the cost of purchased power from the four Quebec companies would have amounted to the appalling sum of $10,965,000 per year. In actual fact, and notwithstanding some increases in demand, we will, in that year, on the basis of the new contract, pay the sum of $2,750,000.00, a saving in the cost of power purchased of $8,214,500.00. o ce tinue and, in fact, will increase in subsequent years, due to the fact that deliveries under the old contracts are not yet complete. a saving of $7,720,000.00, and in 1939 to $3,707,500.00, a saving of $7,257,-- 500.00. For the four years frqm 19:}6 to 1939, inclusive, our reductions in power costs as a result of the new agreements will amount to $29,472,-- 689.74. We have paid to the power companies in gross amounts from the year 1928 to the year 1935, inclusive, the sum of $33,652,337.51, so that our saving in power costs during the next four years is thus approximately within $4,000,000.00 of the total gross TV LGEKLEE --NREpNOAENACRCUROEATE OADC UE ip amounts paid to the four companies since the first horse--power arrived from the earliest Gatineau contract. "In view of these sensational cuts in the cost of power, the question will naturally arise as to what benefit may be expected by the Commission's cus-- tomers. The Commission has not been ,unmindful of the future, and during the past year has had prepared at considerable expense a very com-- plete analysis of the power loads of Ontario, so that such steps may be taken to protect its requirements as cireumstances appear to warrant. At best, however, any calculation as to "I shold not close my report of the year's accomplishments in the Niagara Ssystem without some reference to the Commission's policy with regard to future power requirements. The ex-- perience of the last five years, and particularly that of the period in which the present Commission had held office, is proof beyond peradven-- ture of the inadvisability of permitting the power requirements of the people of this Province to depend in any large measure upon supplies of energy from sources in private control, and still more clear is the experience as to the danger of depsnding for our power reeds upon private companies, subject to the legislative jurisdiction of any other Province. There can be little objection to the purchase of moderate quantities which, were they at any time discontinued, would not result in a major disaster to the Hydro System and its customers, but to tie the Sys-- tem to supplies from beyond our bor-- ders in such large amounts that they cannot be readily replaced is to accept risks which are inadvisable and un-- necessary. It is to lay the fires of dis-- cord and ill--will, and to invite dis-- aster. Never again shall the Hydro C:mmission or the Province of Ontarie permits its contracts for the purchase of power to be used by promoters as the basis for sales of stocks and bonds to the investing public. From now on the people of this Province should de-- pend upon their own ability to pro-- duce and distribute. The principle of public ownership should be extended in Hydro matters and tenaciously ob-- served, and. above all things, Ontario must in the future own and control the courses as well as the distributing svstems for its supply of power. March 4 "In this connection it is interesting to note the actual conditions existing at the Niagara Cataract. Gatineau, be it observed, is 260 miles from the City of Toronto. Niagara Falls is less than eighty miles distant, and the Niagara plants are located in the very centre of an industrial community. How important is this matter of lo-- cation is indirated in the experience of the last year. Much has been said of the efficiency of the 220,000--voilt it.ranamssion line from Gatineau to Toronto, and some calculations have been made public as to the amount of the line losses in electric energy, by reason of leakage and resistance. Ex-- perience is an apt teacher and the reductions in the supply during this year, from the Quebec plants, and the | substitution of increased loads from Niagara have taught us much. Our actual practice has demonstrated that *J us emes -- our line losses since the cutting off of the Eastern power and the substi-- tution of Niagara power have peen 26,000 h.p. less than they were under former conditions. At $15 per h.p. this is a saving on line losses alone, by reason of our present arrange-- ments, of $390,000 per year. "The Commission owns and oper-- ates three generating plants on the Niagara River. Two are at Niagara Falls and the other at Queenston. What is known as the Toronto plant was that which was taken over from the Toronto Power Company in the year 1920, and is situate above the Falls. Its efficiency is only 9.5 h.p. per cu. foot per second of water used. What is known as the Ontario plant was purchased by the Commission from the Ontario Power Company in the year 1916, and is situate in the : gorge immediately below the cataract.: It has an efficiency of 17 h.p. for each cubic foot per second of water used. The third plant is that which was constructed by the Commission at Queenston, and is fed by water con-- veyed from Niagara River via Chip-- pawa Canal Under normal con-- ditions its efficiency is 29.6 h.p., or very nearly 30 h.p. for each cubic foot ; per second of water used. From these figures it is quite obvious that the ef-- ficiency of the Toronto plant is very low, being somewhat less than 1--3 per second foot of that at Queenston. The Ontario plant is better, but is still somewhat less than 2--3 of that of the Queenston plant. The opportunity for an engineering and construction program at Niagara is quite apparent from these figures, and in addition, considerable quantities of water may still be diverted into power channels without endangering the scenic beauty of the Falls. The policy of this Gov-- ernment is to free itself as rapidly as reasonably possible from entangling alliances with private power com-- panies, and the policy of the Hydro Commission is 'Back to Niagara.'" **%