Part 1. Canada’s Electrical Grid: Current State and Obstacles

By Denis Koshelev

Canada’s electrical infrastructure faces a clear and present danger. A perfect storm of intensifying extreme weather, soaring electricity demand, and lagging infrastructure investment is pushing the grid to its limits, creating unprecedented challenges to its reliability. The current grid structure, dominated by north-south interconnections primarily designed for electricity exports to the United States, may need fundamental restructuring to meet future demands and climate goals. While various initiatives are underway to modernize and expand the grid, significant gaps remain between projected demand growth and infrastructure development pace, raising questions about whether current investment levels are adequate for the transformation required.

Current Grid Structure and Operational Framework

Canada’s electricity supply is a complex interplay of federal and provincial governance. The nation boasts an installed electric capacity of approximately 140 gigawatts, generating 639 terawatt-hours annually, with consumption reaching 550 terawatt-hours. [1]

Integral to the North American Bulk Electric System (BES), Canada’s grid is extensively connected with the United States and Mexico, forming a vast network of roughly 430,000 kilometres of high-voltage transmission lines. This integration spurred Canada and the United States to harmonize mandatory reliability standards following the 2003 North American blackout. Each Canadian province bordering the United States maintains at least one high-voltage electricity transmission link with its American counterpart. [2] And that’s part of the issue: the grid is built for north-south exports, not east-west resilience.

While each province and territory maintains its distinct electricity regulatory framework, federal oversight, primarily through the Canada Energy Regulator (CER), is limited to permitting international exports and overseeing the construction and operation of international and designated interprovincial power lines. Provincial organizations, along with the federal Natural Resources Canada and the CER, play a crucial role in monitoring, advising on, and guiding energy-related matters.

Electric reliability in Canada hinges on the real-time balance of supply and demand. The North American Bulk Electric System, spanning Canada, the United States, and Mexico, with its extensive 430,000 kilometres of high-voltage transmission lines, crucially includes 34 active transmission lines connecting Canada and the United States, alongside 33 interprovincial lines within Canada. From 2010 to 2024, Canada’s annual electricity exports averaged 59 terawatt-hours (TWh), while US exports averaged 13 TWh each year. To put this in perspective, Canada’s total electricity production for 2023 was 615 TWh. [2]

The 2003 North American blackout spurred the development of over 100 mandatory reliability standards. These comprehensive standards cover all aspects of grid integrity, from transmission operations and demand balancing to facility design, system planning, communications, training, security (cyber and physical), and emergency preparedness. The North American Electric Reliability Corporation (NERC), certified as the Electric Reliability Organization (ERO) for the United States in 2006, sees its standards adopted and enforced at the provincial level throughout Canada.

Each Canadian jurisdiction operates a unique electricity system with its own regulatory framework. Key stakeholders include the Canada Energy Regulator, Natural Resources Canada, and various provincial utilities and regulatory bodies. Provincial electric reliability frameworks vary significantly; for instance, Yukon and Nunavut operate in isolation from the North American Bulk Electric System, relying on diesel generation. In contrast, provinces like British Columbia, Alberta, and Ontario are deeply integrated into the BES and have aligned their mandatory reliability standards with those of the United States.[1]

Extreme Weather Vulnerability and Infrastructure Gaps

Canada’s electrical infrastructure faces growing danger from the escalating frequency and intensity of extreme weather events, leading to more prevalent grid alerts nationwide. Alberta’s power system, in particular, has seen a sharp rise in such warnings, with only four provincial alerts between 2017 and 2020, but an alarming 17 additional alerts since 2021 alone. This trend mirrors a wider North American challenge where severe weather increasingly threatens to overwhelm power grids, evidenced by new peak electricity demands emerging across regions like Ontario and Quebec.

Francis Bradley, CEO of Electricity Canada, a prominent industry association, emphasized that virtually no part of the electricity grid is immune to the amplified severity and prolonged duration of climate change-induced extreme weather:

“Over the last two years or so, during these extremes of weather, we’ve seen new peaks hit in terms of electricity demand. And it’s not just in Alberta. We saw new peak demands hit last summer in Ontario, we saw new peak demand hit last winter in Quebec, for example. In most regions of the country, the extremes are increasing.”

The vulnerability of Canada’s grid to extreme weather was illustrated during the February 2024 cold spell that affected Western Canada and parts of the United States. Alberta faced record electricity demand while simultaneously dealing with reduced power generation capacity due to maintenance requirements, leading the Alberta Electric System Operator (AESO) to issue grid alerts warning residents of potential power losses. This crisis was ultimately averted through the north-south interconnection system, with British Columbia’s BC Hydro providing emergency support to Alberta’s grid. However, this incident highlighted the system’s vulnerability and the critical importance of inter-regional cooperation during extreme weather events. [3]

The projected growth in electricity demand significantly outpaces current infrastructure development plans, creating a substantial gap that threatens future grid reliability. Canadian electricity demand is expected to grow to 1.6 to 2.1 times current levels by 2050, requiring the nation’s electricity generation capacity to expand by 2.2 to 3.4 times current levels. This dramatic increase in both demand and required capacity occurs against a backdrop of aging infrastructure and the need to simultaneously phase out coal-fired power plants while integrating increasing amounts of intermittent renewable energy sources. The scale of this transformation requires unprecedented coordination and investment across all levels of government and the private sector. [4]

Despite the clear and present dangers posed by climate change, a survey conducted for the Ontario Energy Board revealed a critical gap in preparedness. The majority of electricity utilities in the province do not actively study how climate change could threaten their power grids, with less than a quarter carrying out comprehensive climate vulnerability assessments. Climate risk strategies are crucial for proactively strengthening grids, and one study from the Canadian Climate Institute indicated that such proactive measures could slash damage costs by as much as 80 percent by the end of the century. [8]

Verdict

Canada’s electricity grid is not ready. It is being squeezed between the escalating force of a changing climate and the immense pressure of future demand. While it remains generally reliable today, recent emergencies were managed by luck and last-minute public appeals, not by design.

The current north-south focus, combined with a national deficit in climate risk planning, leaves our most critical infrastructure exposed. Without a fundamental shift in strategy and an unprecedented level of investment, Canadians face a future where the power may not always be there when they need it most.

Part 1. Canada’s Electrical Grid: Current State and Obstacles

By Denis Koshelev

Current Grid Structure and Operational Framework

Extreme Weather Vulnerability and Infrastructure Gaps

Verdict

References