Ontario imposes 25% surcharge on U.S. electricity exports amid trade tensions

The Canadian province of Ontario has imposed a 25% surcharge on all electricity exports to the U.S., impacting 1.5 million homes and businesses in Michigan, Minnesota, and New York.

The measure, announced by the Ontario government on Monday, comes as part of its response to U.S. tariffs on Canadian imports, even though President Trump announced a new delay on tariffs for imports complying with the USMCA-CUSMA trade agreement.

“President Trump’s tariffs are a disaster for the U.S. economy. They’re making life more expensive for American families and businesses,” Ontario Premier Doug Ford said in a statement. “Until the threat of tariffs is gone for good, Ontario won’t back down. We’ll stand strong, use every tool in our toolkit, and do whatever it takes to protect Ontario.”

The new market rules require generators selling electricity to the U.S. to apply a 25% surcharge, equivalent to $10 per megawatt-hour (MWh). The Ontario government estimates that the measure will generate between $300,000 and $400,000 CAD per day, with the revenue directed toward supporting Ontario workers, families, and businesses.

Ford also warned that the province could further escalate its response, including increasing the surcharge or cutting off electricity exports entirely if U.S. trade policies persist.

The electricity surcharge follows additional retaliatory actions at both federal and provincial levels. The Canadian government has imposed an initial round of $30 billion CAD in tariffs, while the Liquor Control Board of Ontario (LCBO) has also removed all American products from its shelves.

British Columbia has taken similar action against U.S. goods, with Premier David Eby announcing on Monday that all American beer, wine, spirits, and refreshment beverages will be removed from shelves at BCLIQUOR stores. “The stores carry hundreds of types of U.S. alcohol that the BC Liquor Distribution Branch will also no longer be purchasing,” Eby stated.

These measures come amid heightened tensions between Canada and the U.S., as President Trump has threatened to impose tariffs on Canadian imports and has also mentioned multiple times that Canada should become the 51st U.S. state.