BREAKING: CANADA RAISES ELECTRICITY RATES IN A STUNNING SHIFT — NEW YORK AND BOSTON BRACE FOR ENERGY TURBULENCE 
A trade dispute between the United States and Canada briefly spilled into one of the most sensitive corners of the North American economy this month: the electric grid.
When Doug Ford, the premier of Ontario, announced that his province would impose a 25 percent surcharge on electricity exports to several American states, the move underscored how deeply integrated — and newly vulnerable — cross-border energy markets have become. The surcharge, he said, was a response to tariffs imposed by President Donald Trump on a range of Canadian goods.
Electricity rarely becomes a headline in trade disputes. It flows quietly across transmission lines built over decades, governed more by engineering constraints and supply-demand balancing than by political rhetoric. But Ontario’s decision to raise the cost of exported power — and to warn that a full cutoff was possible — forced officials in New York and New England to confront how dependent parts of the Northeast are on Canadian energy.
According to the New York Independent System Operator, the state imported roughly 7.7 terawatt-hours of electricity from Canada in 2024, more than any other state. Those flows come primarily from Ontario and Quebec and can reach up to 4,600 megawatts at peak capacity. In New England, the region’s grid operator, ISO New England, has reported that Canadian imports have supplied about 11 percent of the region’s total electricity load over the past five years, particularly during periods of extreme cold or heat.
The surcharge, which Ontario projected would generate between 300,000 and 400,000 Canadian dollars per day, was designed as economic leverage. Mr. Ford argued that American tariffs — including a 25 percent duty on many Canadian goods and earlier steel and aluminum measures — left the province little choice but to respond. Canada had already announced retaliatory tariffs on tens of billions of dollars’ worth of U.S. exports and filed challenges at the World Trade Organization.
For American consumers, the immediate concern was cost. ISO New England estimated that a 10 to 25 percent tariff on Canadian electricity could add between $66 million and $165 million annually to regional expenses, costs that would ultimately be passed on to households and businesses. New York officials warned that higher import prices could ripple through wholesale markets, raising rates especially during peak demand.
In Boston and across the Northeast, hydroelectric power from Canada has long served as a stabilizing force. It can be dispatched relatively quickly and emits far fewer greenhouse gases than fossil-fuel alternatives. If imports become more expensive or unreliable, grid operators may need to rely more heavily on natural gas-fired plants — an option that can raise both costs and emissions.
The dispute also prompted regulatory action. Both NYISO and ISO New England filed emergency proposals with the Federal Energy Regulatory Commission, seeking authority to collect any import duties that might be imposed on Canadian electricity. The commission approved revisions that would allow such charges to be processed if required, though grid operators emphasized that they are not structured to act as customs agencies.
State officials offered varying assessments of the impact. In Minnesota and Michigan — also named in Ontario’s announcement — leaders suggested that exposure would be more limited because much of their electricity is generated in-state or secured through long-term contracts. Still, regulators cautioned that any disruption to cross-border flows reduces flexibility and increases vulnerability during peak demand or unexpected outages.
The political back-and-forth moved quickly. After Ontario imposed the surcharge, Mr. Trump threatened to double tariffs on Canadian steel and aluminum to 50 percent. Within days, following discussions between provincial and federal officials, Ontario paused the electricity surcharge, and the White House stepped back from the higher metal tariffs.
The rapid escalation and de-escalation illustrated how modern trade conflicts can reach beyond factories and warehouses into essential infrastructure. Nearly 60 percent of U.S. crude oil imports come from Canada, and about 85 percent of U.S. electricity imports originate north of the border. That interdependence has historically been treated as mutually beneficial — a way to smooth volatility and enhance reliability across a vast continent.
Yet the episode revealed how political strategy can intrude on systems built for stability. The North American grid was designed around shared planning and cost efficiency, not as a bargaining chip in tariff negotiations. Introducing surcharges and countermeasures adds a layer of uncertainty to markets that depend on predictability.
For residents of New York, Boston and other Northeastern cities, the implications are tangible. During winter cold snaps and summer heat waves, when demand surges, even small price shifts can translate into noticeable changes on monthly utility bills. Households already facing higher housing and food costs may feel the added strain.
Although the surcharge has been suspended for now, Mr. Ford has said it could return if U.S. tariffs are reinstated or expanded. Canadian officials have also signaled that other energy-related measures remain under consideration, while American leaders continue to weigh additional duties on goods such as lumber, dairy products and vehicles.
The underlying tensions remain unresolved. What the episode has made clear is that in an era of intensifying trade disputes, even the most interconnected and technically sophisticated systems — including the cross-border electric grid — are not immune to geopolitical pressure. The lights have not gone out in New York or Boston. But the reliability once taken for granted now carries a new political dimension.
