Utilities

Twenty-five percent of the world's fresh water supply is located in Canada. A third of that water, or about 8% of the world's total supply, can be found in BC.

Falling or moving water is used to generate about 90% of BC's electric power. Electric utilities in BC rely on a bountiful source of fresh water to produce hydroelectric power at dams including the Revelstoke and Mica dams in the Kootenays, and the WAC Bennett and Peace Canyon dams in the Peace River region.

Electricity is also generated by power plants, most of which are fueled by natural gas. Some mining and mineral processing plants produce power as a by-product, and this is resold to the electric power utility. As well, power producers are investigating the feasibility of other means of generating electricity, including run-of-the-river projects, wind farms and alternative energy technologies.

What's included in utilities?

The utilities industry includes establishments that operate electric power, gas and water utilities. We heat our homes, cook our food and even play computer games using electricity or natural gas that's supplied by the utilities industry. Water purification and distribution, and sewer services are also included in this industry.

The infrastructure required to deliver electrical power and natural gas to consumers, or to supply water and sewer services is costly to build and maintain. For this reason, companies in this industry tend to be relatively large and are few in number.

About a quarter of the energy used by households, businesses, and factories in BC, and 45% of household energy consumption, is in the form of electricity. BC Hydro is the main supplier of electric power in the province. The company operates 18,286 kilometres of transmission lines and 55,254 kilometres of distribution lines that bring power from the generators to consumers. Other companies, such as West Kootenay Power, also provide service in some areas of the province. Distribution systems make it possible for the province to export excess electric power generated in BC to other provinces and to the rest of North America and, when necessary, to import power to supplement local electricity production.

More than half of the energy used in BC comes from electricity or natural gas...

...which is mainly used by industrial and residential consumers

About 30% of BC's total energy use, and 54% of household energy requirements, is fired by natural gas. Terasen Gas is the major distributor of natural gas in BC. Natural gas from the Peace River area is transmitted by pipeline to consumers in the Lower Mainland and on Vancouver Island.

Water and sewer services are usually provided by local municipalities. Although municipalities are responsible for ensuring that these services are available to residents, the establishments providing them are considered to be part of the utilities industry rather than public administration.

What's happened since 1990?

Electric power, natural gas, water, sewer and other utilities employ less than 1% of the province's workforce, a share that has remained fairly stable since 1990. However, the industry's contribution to total GDP is much higher, at just over 2%. The output of the utilities industry hasn't been growing quite as fast as the rest of the economy, and the share of total GDP originating in this industry has been falling since 1990.

Utilities account for a declining share of the province's GDP

Just over three-quarters of the industry's GDP originates in electric power production, while natural gas distribution and water and sewer systems generate another 22% of total value added in the industry.

Utilities rely more on capital equipment than labour to produce their output

The difference between this industry's share of total GDP and its share of employment reflects the way in which utilities such as electric power and gas distribution are produced. The value added to the economy by an industry is the result of using both capital (equipment) and labour inputs to transform purchased materials into a final product. In this industry, most of the work is not done by humans.

Electric power utilities use dams (which are a type of capital), turbines, and generators to convert water resources into electricity, which is then transmitted along a complex network of power lines to their customers. Similarly, natural gas which has been extracted from wells (by the mining industry) is first liquefied and then transported through a pipeline system to the gas utility, which then provides the fuel to its clients, whether businesses or consumers. Water purification plants and sewer systems rely on pipe systems and treatment and processing facilities to provide customers with clean water and to remove their wastewater.

Companies invest a great deal of money building dams and other power generation systems, as well as the power and gas distribution lines, and water and sewer treatment plants and mains. But once they're in place, the equipment does most of the work needed to supply the power, gas, or water to customers.

The industry still needs people to operate and maintain the equipment, to test for impurities and other problems, and to make repairs to equipment and powerlines, but the human element is much smaller than in most other industries. That's why the ratio of GDP per worker in utilities is so much higher than the average for the economy as a whole. However, the size of the GDP-employment gap has been shrinking. This indicates that labour productivity improvements in utilities have not been as strong as in the rest of the economy.

What are the most common occupations?

As in many other goods industries, tradespeople and transportation equipment operators make up the biggest percentage (37%) of the workforce. Many of them work as power system operators, power line and cable workers, or operators of water and waste water systems.

Trades, transportation & equipment operators are common occupations, but there is also a large clerical and administrative workforce

Business, finance and administrative workers, especially clerical workers, make up 18% of the workforce. The relatively large number of clerical workers reflects the nature of the industry, which provides power, gas, water and sewer services to households, businesses, and industries all over the province. A large clerical staff is required to handle all the billing, start-ups, shut-downs, and other procedures.

Utilities also employ a relatively large number of workers in natural and applied sciences-nearly a fifth of the total workforce. Most of them are engineers, computer programmers and operators, and technicians.

Thirteen percent of the workers in this industry are in occupations unique to processing, manufacturing and utilities. These are mainly water and waste plant operators, and people who work as gas processing operators.

How many people work in the utilities industry, and how much do they earn?

The utilities industry employed 14,200 people in 2008, most (9,700) of whom worked in the electric power industry. Another 2,300 had jobs in natural gas distribution, and 2,200 worked for water and sewer utilities.

The average hourly wage rate was $30.05 in 2008. This is higher than in any of the other major industry groups in BC, and well above the $21.46 average for all industries in the province. The wage gap may reflect the relatively large number of highly-skilled workers in this industry. In addition, some employees (such as power line workers) have jobs that can be quite risky, so their pay includes a risk premium. Workers in the industry typically spend 38 hours a week on the job.

Average hourly earnings are higher than in any other industry

What are the characteristics of the work force?

Virtually every worker (96%) in the industry had a full-time job in 2008. Self-employment is usually not an option in utilities, since the industry is highly capital intensive and relies on a costly infrastructure network. It is usually not feasible for a small operator to start an electric power or sewer system company-at least not as a small self-employed business using traditional methods of power production involving huge investments in capital equipment.

Employment in this industry is not highly seasonal, although some employees, such as line workers, are probably busier during the fall and winter months when stormy weather can damage power lines. However, for the industry as a whole there is only a modest variation in typical employment levels throughout the year. The industry usually does not have a lot of temporary workers.

The utilities industry is highly unionized. Seven out of 10 workers have union coverage

Union coverage in the utilities industry is significantly higher than in any of the other goods industries. About 69% of the people who work in this industry have union coverage, more than double the provincial average (31%). Only public administration and education have similarly high rates of union coverage.

The unemployment rate in the utilities industry is extremely low, averaging 2.6% during the period from 1990 to 2008, a third of the 7.8% rate for all industries in BC.

Utilities are relatively well insulated from the ups and downs that affect the rest of the economy. Generally speaking, the demand for power, or gas, or water and sewer services doesn't really depend on economic conditions. The weather may have an effect on the amount of power or gas used, but heating homes, cooking meals, and being able to operate appliances and equipment isn't the type of expenditure that most people would view as optional. They might be more careful about turning the lights off when they leave a room, but they're not going to stop using power or fuel even if they are trying to cut back on their other spending. However, commercial usage of electric power and other utility systems may be affected by changes in the economy.

Establishments in utilities tend to be larger than average

People who are employed in utilities are likely to work in large establishments rather than smaller ones. Only about a fifth of them work at an establishment where there are fewer than 20 employees.

Where are the jobs located?

Sixty-eight percent of the workers in this industry are located in the Lower Mainland region, with another 8% living in the Vancouver Island/Coast region. Utilities account for a higher-than-average share of total employment in Thompson-Okanagan (13%) and Cariboo (6%).

Over two-thirds of the jobs are located in Mainland/Southwest

What's the outlook to 2014?

GDP in this industry is expected to grow at higher-than-average rates during the next few years. Utilities are forecast to generate about 3% of the province's GDP, and employ less than 1% of the workers.

GDP is expected to grow faster than average during the next few years