On April 2, 2025, President Trump announced sweeping new tariffs, including a 10 per cent baseline tariff on all imports and higher rates for certain countries. While Canada has been exempted from these new tariffs, tensions over trade policies continue to affect cross-border relations.
In response to earlier U.S. tariffs on Canadian goods, the Ontario government announced on March 10th that it would impose a 25 per cent surcharge on all electricity exports to the 1.5 million U.S. homes and businesses receiving power from Ontario.
Premier Doug Ford sent a letter to senators, members of congress and the governors of New York, Michigan and Minnesota on March 4th to inform them of the surcharge.
The surcharge – valued at $10 per megawatt-hour – could end up costing about $400,000 each day it is in place, according to the Ontario Newsroom, the official communications platform of the Government of Ontario.
The funds that will be collected through the surcharge will be held by the Independent Electricity System Operator (IESO), which will then be used to support Ontario workers, families and businesses.
The surcharge might not be limited to 25 per cent. The Ontario government holds the ability to increase or decrease the surcharge at any point in response to U.S. administration actions.
This decision could not only have adverse impacts on the environment and climate but also speaks to the issue of an economic war between Canada and the U.S.
“This likely makes both sides less trusting in the other,” said Dr. Daniel Hoornweg, Ontario Tech professor and researcher in urban systems and community sustainability.
Hoornweg said this may have a larger impact on Ontario and neighbouring U.S. states in the long run because they are part of an integrated cooperative electricity system.
According to Connect2Canada, a company striving to break down barriers around the world, Canada and the U.S. have one of the most integrated electric grids in the world. This system enhances reliability, security and affordability to customers in both Canada and the U.S.
“Ontarians are subsidizing electricity shipped/conducted to those states which receive it,” said Ward 4 Regional and City Councillor, Rick Kerr.
Affordable sustainable energy is becoming increasingly more important to prevent the impacts of non-sustainable energy systems worsening.
“Jurisdictions may burn more gas (and possibly coal) to offset Ontario’s typically lower-carbon electricity,” Hoornweg explained, adding it’s “likely more fossil fuels will be used.”
On the road to sustainability, Durham College (DC) opened its Energy Innovation Centre (EIC) in 2019, which utilizes 550 tons – 1.9 megawatts – of clean, sustainable underground thermal energy for the heating and cooling of DC’s Gordon Willey Building, fueling its energy needs.
Durham Region has been working towards more sustainable energy use through initiatives like The Durham Community Energy Plan, which encourages the development, storage and transmission of community energy to provide economic, environmental, health and social benefits to the region.
With Ontario exploring various energy sources—including wind, solar, nuclear, hydro, coal and gas—the province faces ongoing decisions about balancing sustainability with economic and political realities.
While the long-term impact of the surcharge remains uncertain, Durham Region’s sustainability initiatives, such as the Durham Community Energy Plan and DC’s Energy Innovation Centre, reflect a commitment to a cleaner energy future.