Canada May Cut US Power as Trump Trade War Grows

Toronto: Canada could consider restricting electricity and critical-mineral exports to the United States if its escalating trade dispute with Washington worsens, Ontario Premier Doug Ford has warned, as fresh tariffs imposed by US President Donald Trump deepen tensions between the longtime allies.

Ford said that “everything’s on the table,” including electricity, critical minerals and fuel, and argued that Canada should be prepared to use its economic leverage if Washington continues increasing pressure on Canadian industries.

Ontario Raises Possibility of Cutting Electricity Exports

Ontario supplies electricity directly to New York, Michigan and Minnesota through cross-border connections.

Ford said Ontario could potentially halt those exports as part of a broader Canadian response to US trade measures. He noted that Ontario-generated electricity serves roughly 1.5 million American homes and businesses.

The threat does not mean electricity exports have been stopped. At this stage, it remains one of several possible retaliatory options being discussed if the trade confrontation intensifies.

Trump Escalates Tariff Pressure on Canada

Relations deteriorated further after trade negotiations between Canada and the United States broke down.

The United States imposed 50% tariffs on approximately $20 billion worth of Canadian products, while Trump has also threatened 50% tariffs on Canadian vehicles, auto parts and steel beginning in 2027.

Canadian Prime Minister Mark Carney has accused Washington of seeking terms that would damage major Canadian industries, including the country's closely integrated automobile, steel and aluminium sectors.

Canada Preparing Retaliatory Measures

Carney's government has said Canada will respond to the latest US tariffs and has been preparing countermeasures aimed at protecting Canadian workers and businesses.

Following a meeting with provincial and territorial leaders, Carney said Canada would introduce counter-tariffs after the Labour Day weekend while continuing efforts to diversify the country's export markets and reduce its economic reliance on the United States.

Canadian officials have also discussed whether retaliation should go beyond tariffs and target strategically important exports.

Electricity Could Become Powerful Trade Leverage

Canada is an important electricity supplier to the United States.

Canadian electricity exports to the US were worth about C$3.3 billion in 2025, according to government figures cited by Business Insider, while more than 20 US states import Canadian electricity.

Ontario alone exported 21,051 gigawatt-hours of electricity in 2025 to neighbouring provinces and US states, including New York, Michigan and Minnesota. New York imported 7,461 GWh from Ontario during the year.

During a July 2026 heat wave, Canadian electricity accounted for around 9% of New York state's electricity usage on July 3, illustrating the importance of cross-border energy flows during periods of high demand.

Critical Minerals, Oil and Potash Also Mentioned

Electricity is not Canada's only potential source of leverage.

Ford also pointed to commodities including oil, nickel, uranium and potash, arguing that Canadian provinces should coordinate their response if the United States imposes additional trade restrictions.

Canada is an important supplier of many resources used by US energy, agriculture, manufacturing and technology industries.

Previous Electricity Dispute

This would not be the first time Ontario has used electricity exports as leverage.

In 2025, the province temporarily imposed a 25% surcharge on electricity sold to New York, Michigan and Minnesota during an earlier dispute with the Trump administration. The surcharge was subsequently withdrawn after trade discussions resumed.

Ford also threatened at that time to halt electricity exports completely if the confrontation escalated.

Deep Economic Ties Raise Risks for Both Countries

Despite increasingly tough rhetoric, Canada and the United States remain deeply economically interconnected.

Supply chains in automobiles, energy, agriculture and manufacturing cross the border repeatedly, meaning prolonged retaliation could increase costs for companies and consumers on both sides.

For now, a shutdown of Canadian electricity exports remains a threat rather than an implemented policy. But Ford's comments demonstrate how rapidly the dispute is expanding beyond conventional tariffs into strategically important areas such as energy and critical minerals.