A Conversation with Sergio Marchi, President and Chief Executive Officer of the Canadian Electricity Association

Industry Priorities: Electricity Infrastructure Renewal and Cyber Security

Sergio Marchi’s desk in Ottawa is inundated with publications and reports about Canada’s electricity industry, where it stands today, and where it needs to be in the future. He has immersed himself in the subject since February, when he returned to Canada from several years in Geneva to take on the role of president and chief executive officer of the Canadian Electricity Association.

A former Canadian trade minister and ambassador with the World Trade Organization and United Nations, Marchi is no stranger to briefings to get up-to-date on new portfolios. And amidst meetings with industry representatives and board members, one key issue has jumped out at the 58-year-old as the most critical for Canada – the need to renew the nation’s electricity infrastructure.

Canada’s vast landscape is crisscrossed by aging power lines and plants, a vital electricity system that will demand $350 billion within the next two decades just to keep running, he notes. Most Canadians – a good 80 per cent, according to the association – agree the country should invest in new infrastructure, but fewer than half want to pay for it. Industry has to work harder at engaging the public in a dialogue with a different focus, Marchi said.

“We have to shift the conversation from not just cost, but to also embody the issue of value,” he explained. “What is the value of electricity to our quality of life? What is the value of electricity economically, what is the value of electricity to our institutions?

“Therefore the question is if we don’t reinvest, what are the costs of doing nothing, which might outweigh the costs of electricity system renewal?”

Power lines accross a field.

Power lines accross a field.

Canadians are the fourth largest consumers of electricity in the world. In January 2015, power generation in Canada hit a high of 61.3 million megawatt hours, enough to power industries from mining to oil sands, keep all home lights and appliances on, and run aspects of businesses, with enough (almost nine per cent, or 5.4 million MWh) left over to export to the United States.

The focus on that north/south link between Canada and the U.S. was one of the biggest surprises for Marchi. He saw much less emphasis on regional, east-west pan-Canadian discussions. The disparity is in part due to there being more interconnectivity between the two countries than there is between provinces, but lack of political will to encourage regional cooperation also plays a role – something he hopes will change.

“I think we have to marshal the national will to do some big things, and the infrastructure needs of our electricity system is a big thing, it’s a big project, and the way you tackle big projects is to do it together,” he said. “And to complement the north/south reality, we do need a national conversation and a national will.”

Another issue Marchi wants to put on the public table is that of cyber security, which has become a pressing issue as hack attacks increase on both sides of the border.

A representative of a small Canadian utility told Marchi the number of attacks to its system went from zero four years ago to 15,000 per month last year. That number paled in comparison with a larger, U.S. utility that had recorded 150,000 hack attacks per month.

Marchi said he didn’t use the numbers as a scare tactic, but to make the public aware that people are targeting critical infrastructure, like power grids, and Canada has to have a solid defense.

“Canadians are the fourth largest consumers of electricity in the world.”

“Canadians are the fourth largest consumers of electricity in the world.”

The next issue is taking so-called disruptive technology, such as drones to survey power lines, and putting it to work for better reliability on infrastructure, which again has a cost component, Marchi mused.

“Cyber security has become a pressing issue on both sides of the border.”

“Cyber security has become a pressing issue on both sides of the border.”

“Industry has a role in educating Canadians on where we are with our infrastructure, what the needs are, what the security imperatives are, and what the technologies are that we need to incorporate,” he said.

Marchi sees a need for industry to do more community outreach.

“I believe that the biggest projects in Canada’s history have always come as a byproduct of a national conversation. I believe that profoundly, and I believe that that’s going to continue to be the case.”

Dina O’Meara is former business writer with the Calgary Herald and is now a communications consultant.