Key insights
- Canada aims to double electricity generation by 2050, investing over $729 billion. The plan includes adjustments to clean electricity rules, allowing natural gas usage for affordability. This could impact US energy markets by influencing cross-border energy flows and competition, but the lack of specific actions limits immediate market influence.
Investing.com -- Prime Minister Mark Carney published a strategy on Thursday that aims to double Canada’s electricity generation by 2050, including adjustments to clean electricity rules to allow more flexibility for power generation using natural gas.
The total cost of expanding Canada’s power grid is expected to exceed C$1 trillion ($729 billion), according to the strategy. The cost will be distributed among federal and provincial governments and private sector participants.
Carney announced the strategy a day before his government is set to unveil an industrial carbon pricing agreement with Alberta. The agreement is designed to enable construction of a new oil pipeline to the west coast and support a major carbon capture project in the province’s oil sands.
The electricity strategy lacks specific actions to meet its targets but states the government will begin consultations with provinces, territories, Indigenous groups, utilities and unions on implementation.
The strategy commits to using financing and grants to support energy retrofits for up to one million homes in Canada, including incentives to transition to electric heat pumps. The goal is to lower energy costs for approximately 70% of Canadian households.
"Realizing these savings will require a willingness to use most sources of energy – including natural gas," the government said in a news release. "That’s why we intend to adjust clean electricity regulations to provide the flexibility needed to keep energy costs for all Canadian families reliable and affordable, while reducing emissions and building the clean energy system of the future."
The regulations were introduced by Carney’s predecessor, Justin Trudeau, and created tension with Alberta, which argued they would force the province to phase out natural gas power generation.
Carney’s government plans to direct the federal Major Projects Office to develop an investment strategy for building transmission interties to improve Canada’s east-west grid connections, the strategy says.
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