Electric power consumption will pick up on the back of accelerating industrial production.
New York, NY (PRWEB) November 27, 2014
The Electric Power Transmission industry is responsible for storing and distributing electricity from the country's upstream generation facilities. Industry operators manage transmission and distribution networks that total more than 160,000 kilometres to serve residential, industrial and commercial customers. Industry performance is dependent on electricity prices within provinces, although the inelasticity of energy demand and high degree of regulation insulate operators from significant declines in revenue. “Industry performance is also closely tied to industrial output and seasonal factors that influence aggregate demand for energy,” according to IBISWorld Industry Analyst Darryle Ulama. In the five years to 2014, favourable price trends and stable demand from the industry' customer segments have precipitated strong revenue growth. During this time, revenue is expected to increase at an annualized rate of 5.9% to $54.6 billion, including a 2.3% growth in 2014.
Operators are undertaking significant capital investments in order to repair their transmission networks, expand existing lines and build new infrastructure in frontier areas. According to data from Canada Electricity Association, investments in Canada's transmission and distribution cable lines have increased each year from 2010 and 2013. In 2009, investments in transmission and distribution totalled less than $3.0 billion each. By 2013, transmission investment totalled $5.7 billion and distribution investments stood at $3.3 billion. “The significant increase in capital costs have impinged on industry profitability, even as operator revenue has grown strongly during the five years,” says Ulama. Due to strong subnational oversight, capital investment varies by territory or province, with some incurring higher costs due to a larger portfolio of proposed projects.
The industry is anticipated to experience similar trends during the outlook period encompassing the five years to 2019. During this time, electric power consumption will pick up on the back of accelerating industrial production and population growth. Operators will continue to spend significantly on capital investments, with many project timelines continuing into 2019 and beyond.
For more information, visit IBISWorld’s Electric Power Transmission in Canada industry report page.
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IBISWorld industry Report Key Topics
This industry transmits and distributes electric power to other utilities and final consumers. This industry does not generate electricity.
Key External Drivers
Industry Life Cycle
Products & Markets
Products & Services
Globalization & Trade
Market Share Concentration
Key Success Factors
Cost Structure Benchmarks
Barriers to Entry
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