Trump Trade War With Canada Sparks Concern on US Energy Supply

The escalating trade war between the United States and Canada has raised concerns about its potential impact on the U.S. energy supply, particularly in states that import electricity from Ontario.

After President Donald Trump doubled tariffs on Canadian steel and aluminum to 50 percent, Ontario Premier Doug Ford retaliated by imposing—then later withdrawing—a 25 percent surcharge on electricity exports to the U.S. The move left uncertainty for states like Michigan, Minnesota, and New York, which rely on Ontario’s power and have been closely monitoring the situation.

Why It Matters

Ford initially vowed to escalate the dispute, warning that his government was prepared to “shut the electricity off completely” if the U.S. continued increasing tariffs. However, after discussions with U.S. Commerce Secretary Howard Lutnick, he withdrew the surcharge, expressing confidence that the U.S. would reconsider its tariff hikes.

Electricity imports from Canada, measured in megawatt-hours (MWh), peaked in 2020 but have since declined. Still, several U.S. cities remain dependent on Canadian energy. As of 2024, Buffalo received 11.7 million MWh from Canada, while Ogdensburg received 6.02 million MWh.

Other cities, including Seattle, Washington; Portland, Maine; Pembina, North Dakota; and Great Falls, Montana, also import Canadian electricity but were unaffected by Ford’s tariffs.

What to Know

The sudden shifts in trade policy have left energy regulators and grid operators scrambling to assess potential disruptions. Michigan, which shares direct electrical interconnections with Ontario, is at the center of these concerns.

“Of greater concern is the stability of the electric grid. There are significant flows across the border because of the interconnected grids between the two countries,” the Michigan Public Service Commission (MPSC) stated in a response shared with Newsweek.

Transmission towers that carry high-voltage electricity are show on March 8, 2025 in East China Township, Michigan. Ontario, Canada Premier Doug Ford said Ontario will be putting a 25 percent tariff on electricity that the…
Transmission towers that carry high-voltage electricity are show on March 8, 2025 in East China Township, Michigan. Ontario, Canada Premier Doug Ford said Ontario will be putting a 25 percent tariff on electricity that the Province provides to Michigan, Minnesota, and New York beginning March 10th as a response to the tariffs President Donald Trump imposed on goods from Canada.
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Photo by Bill Pugliano/Getty Images

Michigan’s electric grid has four direct connections with Ontario—one in Detroit and three in St. Clair County—critical infrastructure that supports energy reliability for both nations. The Midcontinent Independent System Operator (MISO), which oversees energy flows across multiple U.S. states, closely coordinates with Ontario’s Independent Electricity System Operator (IESO).

Limited Financial Impact

Despite fears of rising electricity costs, state officials believe the immediate financial impact on consumers will be minimal.

“Michigan ratepayers are unlikely to see significant price increases as a result because most of the state’s electricity is produced by in-state utilities or purchased through long-term contracts,” the MPSC said.

Meanwhile, New York’s Independent System Operator (NYISO) is working with Ontario to ensure grid reliability. “The NYISO expects to have adequate reserves to meet reliability criteria and forecasted demand for New York,” the agency told Newsweek.

While New York is expected to see minimal effects, Governor Kathy Hochul and Senator Chuck Schumer have called for a comprehensive review of the tariff’s impact on utility costs.

“These federal tariffs have been poorly conceived from the start: crafted in secret with no transparency and no clear economic rationale,” Hochul said in a statement.

Utility Companies Downplay the Effect

Minnesota’s utility providers have largely dismissed concerns over Ontario’s now-withdrawn electricity surcharge, emphasizing their minimal reliance on power from the province.

Minnesota Power, one of the few utilities with any reliance on Ontario, reported purchasing just $310,000 worth of electricity from the province in 2024—a negligible amount compared to the $108 million spent on power from Manitoba Hydro. In a statement to Newsweek, the company noted that it generates most of its energy within northeastern Minnesota and domestically, using a diverse mix of thermal, wind, hydro, solar, and biomass sources.

Ontario Premier Doug Ford speaks during a press conference at Canada’s Premiers Conference in Toronto, Ontario, December 16, 2024.
Ontario Premier Doug Ford speaks during a press conference at Canada’s Premiers Conference in Toronto, Ontario, December 16, 2024.
Geoff Robins/AFP via Getty Images

“We expect little to no impact on our customers from the 25% Ontario surcharge,” the company stated. While Minnesota Power also buys some electricity from Manitoba, it said this accounts for only a small portion of its overall energy mix. “We will continue to monitor developments on tariffs regarding Manitoba energy but remain confident that our energy supply and the grid will continue delivering the safe, reliable power our customers expect.”

Other Minnesota providers, including Xcel Energy, Great River Energy, and Otter Tail Power, also confirmed to Newsweek that the tariffs would not have affected their customers.

In Michigan, a spokesperson for Consumers Energy, which supplies electricity and natural gas to more than six million residents, told Newsweek that the company does not directly import power from Canada.

“Any net interchange purchases are done through MISO. On the generation side, our fuel for plants comes entirely from within the United States,” the company said.

The regional grid operator, MISO, confirmed that less than 1 percent of its total energy supply in 2024 came from Canada, with less than half of that originating from Ontario. Spokesman Brandon Morris compared this volume to the output of a single power plant, noting that the grid “manages the temporary loss of power plants every day while maintaining a reliable system.”

What Happens Next

Although Ontario’s decision to withdraw the surcharge has eased immediate concerns, state officials remain wary of potential retaliation from Manitoba if the trade war continues to escalate.

Minnesota Governor Tim Walz expressed concern about the possibility of new tariffs from Manitoba, which supplies significantly more power to Minnesota than Ontario ever has.

“In a broader trade war with Canada that includes energy, Minnesota would be a huge loser because of our dependencies,” Pete Wyckoff, deputy commissioner for Walz’s Department of Commerce, said in comments shared with Newsweek on Monday.

Analysis by the World’s Top Exports website—based on figures from the CIA’s World Factbook, International Trade Centre and U.S. Census Bureau—showed that 22 American states imported electricity from Canada in 2024.

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