This piece originally appeared in the Globe and Mail on March 20, 2025
U.S. President Donald Trump’s mercurial tariff ultimatums and territorial designs on Canada just may be the shock therapy our leaders need to awaken from a homegrown threat: our national electricity planning stupor.
Ever since the first power lines were laid, Canada has generated and delivered electricity within a collection of provincial fiefdoms, each jealously guarding its constitutional jurisdiction over electricity at the expense of smart planning – and energy affordability – for Canadians.
The existing approach might satisfy local political interests, but it creates a dangerously inefficient and fragile national system that harms Canadian consumers and makes businesses less competitive.
We need a new approach to delivering electricity built on interprovincial planning. By co-ordinating and connecting grids currently stranded behind jurisdictional boundaries, we can create a resilient, more affordable energy system for all Canadians.
The advantage of larger regional planning areas lies in their resource diversity. Different regions possess varying sources of generation, from hydropower to wind, solar and thermal energy. When connected through robust transmission networks, the integrated system optimizes generation across a broader geographic footprint.
A regional system also addresses issues of renewable energy variability, as wind patterns and cloud cover affecting generation in one area often differ elsewhere. By linking these areas, aggregate variability decreases significantly, reducing the need for expensive backup generation.
Even before Mr. Trump’s tariff threats, Canada was on track to waste billions of dollars on inefficient and redundant infrastructure. Studies suggest the cost of provincial electricity trade barriers exceeds $2-billion annually in forgone economic benefits.
This does not mean building one big power line connecting Charlottetown to Victoria. The solution lies with co-ordinated electricity planning and interregional governance structures.
The Canada Electricity Advisory Council, established by the federal government in 2023, was a missed opportunity to build this new model (disclosure: I was a member). It became stuck in the status quo of electricity trade barriers that contribute to isolation, lower resilience and higher costs – proving again that there is no role for the federal government in electricity planning. It has no jurisdiction and tends to meddle unhelpfully.
Regional co-ordination must be driven by the regions themselves. Fortunately, there are plenty of models to help overcome the tension between provincial autonomy and electricity optimization. Multistate electricity governance bodies are common practice. The United States has six “reliability councils,” each of them planning the electricity needs for 30 million to 50 million Americans across state boundaries – except for Texas, the only state with a self-contained grid. The Australian Energy Market Operator manages planning and reliability for 80 per cent of Australia’s electricity consumption across its most populous states.
Canadian provinces participate in American reliability councils through the North American Electric Reliability Corporation. But here at home? One electricity planner for Prince Edward Island. One for New Brunswick. One for Manitoba. And so on.
Enhanced reliability from regional integration is compelling. When Texas faced its 2021 winter storm, the state’s isolation from neighbouring grids limited its ability to import emergency power. By contrast, blackouts were prevented in other parts of the U.S. where emergency power could be transmitted thanks to reliability councils and transmission interties.
Alberta – the Texas of Canada from an electricity perspective – faces similar challenges with power shortages and skyrocketing electricity prices because of increasing weather variability and the province’s small, isolated market. Stronger connections to neighbouring provinces would provide crucial backup power. The same applies to Manitoba, which faced drought conditions affecting hydroelectric output in 2021.
The economic benefits of co-operation extend beyond managing variability and crises. Larger markets create competition among generators, driving down wholesale electricity prices. This explains Alberta’s protectionism (other than for oil and gas): Neighbouring provinces have public systems that provide electricity at much lower cost than the private market in Alberta. Trade would lower electricity costs for Albertans and cut private energy companies’ profits. Protectionism is good for companies, and bad for everyone else.
The steps to dismantling interprovincial barriers are clear: create regional planning (reliability) councils. Harmonize provincial market and regulatory frameworks. Co-ordinate long-term planning for transmission infrastructure. And ensure transparent mechanisms for sharing the costs and benefits of interprovincial projects.
Dismantling interprovincial barriers and embracing regional planning will create an electricity system that delivers affordable, reliable and sustainable power for all. That would be a win for Canadians, even if it takes Mr. Trump’s tariff threats to get us there.