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By Claire Dickey
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The United States imported approximately 27,220,531 megawatt hours (MWh) of electricity from Canada in 2024, according to the latest data from the U.S. Energy Information Administration (EIA).
However, this longstanding trade relationship is currently under strain due to escalating trade tensions. In a recent development, Ontario's Premier Doug Ford announced a 25 percent export tax on electricity sent to homes in three northern U.S. states as retaliation for U.S. tariffs, with the potential to shut down electricity imports altogether.
Why It Matters
Recent developments in the electricity trade between the U.S. and Canada highlight its critical role not just in energy supply but also in international relations and economic stability.
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Canada's retaliatory tariffs on electricity—which would affect 1.5 million homes in Minnesota, Michigan and New York, as reported by the Wall Street Journal—could escalate to a complete shutdown of these exports if further U.S. tariffs are implemented on April 2.
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What To Know
According to the EIA, electricity imports from Canada have generally decreased since 2016, with occasional upticks that reflect temporary needs or changes in market conditions.
The 2024 figure of over 27 million MWh, while lower than previous years, still represents a substantial amount of energy—enough to power several million American homes.
Canada is the largest source of U.S. energy imports, according to the EIA.
In contrast to the imports from Mexico, which totaled just over 6 million MWh in 2024, the U.S. received more than four times that amount from Canada, highlighting Canada's crucial role in meeting the U.S. energy demand.
Akshaya Jha, assistant professor of economics and public policy at Carnegie Mellon University's Heinz College, told Newsweek a significant portion of Canada's relevant electricity production is derived from hydropower, whereas a considerable amount of the corresponding U.S. production is sourced from natural gas.
"During times when water is plentiful and natural gas prices are high, US consumers will likely have to pay higher electricity prices as a result of the tariffs, since the tariffs favor domestic gas-fired production over Canadian hydro production when satisfying US electricity demand," Jha told Newsweek.
The potential disruption of these electricity flows—both the exports from Canada and the imports to the U.S.—could impact not only the directly affected states but the overall U.S. economy and its energy security.
What People Are Saying
Ontario Premier Doug Ford told NBC on Monday: "I'm going after absolutely everything, and I don't want to. We keep the lights on for 1.5 million homes and manufacturing in New York, in Michigan and in Minnesota. If he wants to destroy our economy and our families, I will shut down the electricity going down to the U.S., and I'm telling you we will do it.
It's unfortunate, I would rather ship you more electricity, ship you more critical minerals, I want to ship you more energy... it's going to be a massive, massive problem."
Akshaya Jha, assistant professor of economics and public policy at Carnegie Mellon University's Heinz College, told Newsweek: "Tariffs also erode the gains from trade: we want the lowest cost generation resources producing to meet electricity demand across both countries. Tariffs may also distort the reliability benefits from having more dispatchable generation resources across both countries available to quickly adjust production to ensure that supply equals demand at every instant."
Former Canadian Finance Minister Chrystia Freeland told MSNBC: "Right now, this is maybe abstract for Americans. But if these tariffs are put in place, it is going to hurt Americans... You are going to be putting tariffs, a tax, on the oil and gas and electricity that we sell you."
Canadian Prime Minister Justin Trudeau said in a speech on Tuesday: "Today, the United States launched a trade war against Canada. Their closest partner and ally, their closest friend... At the moment, the U.S. tariffs came into effect in the early hours of this morning, and so did the Canadian response. Canada will be implementing 25 percent tariffs against $155 billion worth of American goods."
What Happens Next
The future of U.S. electricity imports from Canada is a critical issue amid ongoing trade negotiations. As both nations discuss trade relationships, changes to these agreements could significantly affect U.S. energy security and costs.
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