Ontario, Canada imposes a 25% surcharge on electricity exports to the U.S., energy sector rises against the trend

Zhitong
2025.03.10 15:44
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The government of Ontario, Canada, has officially implemented a 25% surcharge on electricity exports to the United States as a countermeasure to the U.S. trade war. This policy will increase the cost for power generators exporting electricity to the U.S. by $10 per megawatt-hour, expected to bring an additional revenue of $300,000 to $400,000 per day to Ontario. The Ontario Minister of Energy has called for cooperation between Canada and the U.S. to promote trade relations. Despite the U.S. imposing tariffs on Canadian goods, Ontario has decided to maintain the surcharge policy. Meanwhile, the energy sector has risen against the backdrop of a sharp decline in U.S. stocks

According to Zhitong Finance APP, the government of Ontario, Canada, has officially implemented a 25% surcharge on electricity exports to the United States. This surcharge is one of a series of countermeasures taken by the Ontario government in the context of the escalating trade war with the United States.

According to a press release issued by the Ontario government on Monday morning, the new market rules have officially come into effect. Under the regulations, any power generator exporting electricity to the United States must impose an additional 25% surcharge on top of the electricity price, which translates to an increased cost of $10 per megawatt-hour. Currently, Ontario provides electricity to approximately 1.5 million households and businesses in New York, Michigan, and Minnesota.

Ontario's Energy Minister Stephen Lecce stated in a statement: "For decades, Ontario has provided electricity to American households, factories, and offices, creating jobs. However, we will not stand by and allow the U.S. to take our vital electricity exports for granted." He called for Canada and the United States to work together to promote trade and investment relations to ensure the shared prosperity of both nations.

According to the Ontario government's calculations, the 25% surcharge is expected to generate an additional revenue of $300,000 to $400,000 per day for Ontario, which will be used to support the province's workers, families, and businesses.

Last week, the U.S. government imposed a 25% broad tariff on most Canadian goods, although a few days later, the Trump administration announced that goods compliant with the North American Free Trade Agreement could temporarily be exempt until April 2. However, the Ontario government has decided to maintain its countermeasures and stated that it will not withdraw the surcharge policy unless the U.S. completely lifts these tariffs.

Against the backdrop of a significant drop in the U.S. stock market on Monday, the energy sector rose against the trend. As of the time of writing, American Electric Power (AEP.US) was up 2.4%, ExxonMobil (XOM.US) was up over 2%, Duke Energy (DUK.US) was up 0.66%, NextEra Energy (NEE.US) was up over 2.7%, and Occidental Petroleum (OXY.US) was up 1%

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