Retaliatory Measure Targets American Energy Costs Until U.S. Removes Trade Tariffs

TORONTO – March 10, 2025 – The Ontario government has introduced a 25% surcharge on all electricity exports to the United States, effective immediately, as part of its response to U.S. trade tariffs on Canadian goods.

The surcharge, aimed at offsetting the economic impact of President Donald Trump’s on again off again tariff threats, will increase costs for 1.5 million homes and businesses in Michigan, Minnesota, and New York, potentially adding up to $400,000 in daily expenses for U.S. consumers. It is estimated to cost the average American family an additional $100us per month.

Premier Ford: ‘Ontario Won’t Back Down’

“President Trump’s tariffs are a disaster for the U.S. economy,” said Premier Doug Ford. “They’re making life more expensive for American families and businesses. Until these tariffs are 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.”

Under the new rules, any electricity exported from Ontario to the U.S. will carry a $10 per megawatt-hour (MWh) surcharge. This measure is expected to generate between $300,000 and $400,000 daily, with the funds being reinvested to support Ontario workers, families, and businesses.

Escalation Possible: Ontario Could Cut Off U.S. Power Supply

The Ontario government has warned that if the U.S. increases its trade measures, the province may raise the surcharge further or cut off electricity exports entirely.

“For decades, Ontario has powered American homes, factories, and businesses,” said Energy Minister Stephen Lecce. “We won’t stand by while our energy exports are taken for granted. Instead of driving up costs for families, Canada and the U.S. should be working together on trade, not against each other.”

Part of a Larger Canadian Response

Ontario’s electricity surcharge follows a broader $30 billion retaliatory tariff package imposed by the Government of Canada. Other Ontario-specific measures include:

• LCBO removing all U.S. alcohol products, costing American producers an estimated $1 billion in lost revenue.
• Banning U.S. companies from bidding on $30 billion in annual Ontario government contracts.

Quick Facts

• Ontario exports electricity to Michigan, New York, and Minnesota.
• From 2021 to 2023, Ontario sent 14.6, 14.2, and 12.0 terawatt-hours (TWh) of power to the U.S.
• Ontario has 26 transmission connections with other jurisdictions, including 11 with Quebec, 3 with Manitoba, and 12 with U.S. states.

The trade standoff between Canada and the U.S. is heating up, with Ontario making it clear that it is willing to take bold action to defend its economic interests. Whether the U.S. removes its tariffs—or retaliates further—remains to be seen.