by Robert Zullo,
When President Donald Trump’s administration announced on March 3 that it was moving forward with sweeping tariffs on Mexican and Canadian goods, it ignited anger above the northern border and confusion below it among the organizations that manage the electric grid in parts of both countries.
And though Trump has since pulled back on tariffs for some products from Canada and Mexico and said he will postpone others until April 2, the moves have sown uncertainty around what the tariffs mean for electricity, or even if they apply at all.
Ontario Premier Doug Ford said he would implement a 25% surcharge on electric exports from Ontario and, if the tariff war escalates, consider pulling the plug on power to Michigan, New York and Minnesota.
Trump has imposed a 10% tariff on Canadian “energy and energy resources” that fall outside of a previous free trade agreement. But a pair of trade analysts at the global law firm White & Case wrote that the administration has not provided tariff schedule codes that would lay out what qualifies under those terms.
A spokesperson for the U.S. International Trade Commission, the federal agency that maintains the U.S. tariff schedule and provides information on tariffs, trade and competitiveness, told States Newsroom the Trump tariffs do not apply to electricity.
The spokesperson directed a reporter to a section of the Harmonized Tariff Schedule of the U.S. (which sets out tariff rates and categories for all merchandise imported into the country) that reads “electrical energy shall not be subject to the entry requirements for imported merchandise set forth in section 484 of the Tariff Act of 1930.”
However, some of the regional transmission organizations that manage the electric grid in parts of the U.S. and Canada are laying the groundwork for the possibility of collecting duties on electricity.
ISO New England, which coordinates the flow of power for Maine, New Hampshire, Vermont, Massachusetts, Connecticut and Rhode Island, a region that numbers about 15 million people, said 9% of New England’s electric demand was met with imports from Canada and New York. More than 5% of total demand is served by imports from Canada.
“Based on legal precedent, we do not believe the tariffs placed on Canadian imports apply to electricity, but we are seeking additional guidance,” said Mary Cate Colapietro, a spokesperson for the organization.
ISO New England, along with a counterpart that runs the grid in New York, have made filings with the Federal Energy Regulatory Commission to prepare for potential electric tariffs. Even though it doesn’t think the tariffs apply to electricity, the organization said the filing was necessary “given the uncertainty surrounding these issues,” to ensure a process is in place if the Trump administration determines the tariffs apply to power from Canada..
“We would anticipate if tariffs were implemented on Canadian electricity there would be an impact on prices at the wholesale level,” Colapietro said. “The extent of the impact would depend on several factors, including the level of imports, whether those resources are setting market prices, and the terms of any long-term contracts.”
A spokesman for the Midcontinent Independent System Operator, or MISO, which runs the grid in the Canadian province of Manitoba and all or parts of 15 U.S. states from the Canadian border to the Gulf Coast, also said the organization was unsure about whether it will be forced to collect electric tariffs. MISO serves a population of about 45 million.
“This is a fluid situation and it is unclear whether the U.S. import tariffs apply to imports of electricity from Canada, and it is uncertain whether or when this will be resolved,” said Brandon Morris, a spokesman for MISO. “MISO has received no confirmation from federal agencies regarding the duties’ applicability to electricity or who will be responsible for paying or collecting them.”
Morris said less than 1% of MISO’s total energy in 2024 was supplied via Canadian imports. Less than half of that came from Ontario, he added.
“For context, that amount is equivalent to approximately one power plant,” he said.“MISO manages the loss of power plants like this every day to ensure reliability across our footprint.”
Meghan Sever, a spokesperson for Southwest Power Pool, another regional transmission operator that coordinates the grid for 19 million people in a region of the central U.S. that includes parts or all of 14 states from the Canadian border to Oklahoma and some parts of Texas, said the organization’s “reliance on imports from Canada is small enough that we don’t anticipate tariffs to have a significant impact on regional reliability.”
What effect would tariffs or cuts of Canadian power have?
Kimberly Mielcarek, a vice president at the North American Electric Reliability Corporation, which sets and enforces standards for the bulk power system in the U.S., Canada and part of Mexico, said more than 31 transmission lines connect the U.S. and Canada.
“Cross-border power transfer is valuable for reliability because the free flow of electricity provides operating flexibility between regions during periods of greatest need, particularly for managing seasonal peaks,” she said.
Since the U.S. and Canadian electric systems are managed as a single grid and have been deeply intertwined for decades, it’s tough to come up with a figure for how many Americans get their power from Canada.
“Power can flow back and forth and change directions in milliseconds,” said Rob Gramlich, president of Grid Strategies, an electric policy consulting firm. “Every continental U.S. state except Texas is part of the integrated grid with Canada.”
Generally speaking, the closer to the border, the more reliant a given community might be on Canadian power. But the reach of that electricity can go much farther, Gramlich said.
For example, hydropower from British Columbia and solar electricity from California “are balancing each other every single day,” he said.
Inserting tariffs into the finely tuned operations of electric grids, which have to match supply and demand in real time, and markets, which aim to ensure customers are getting the cheapest generation available, could create a “total mess” and impose big costs on electric customers at a time when bills are already spiking, Gramlich said.
“It would potentially change the generation dispatch every single hour and result in a much less efficient dispatch of the system,” he said. “You’re breaking an integrated machine apart and imposing significant friction inside the machine … It’s too delicate a system to start imposing policies that nobody’s ever even thought about onto these systems.”
Last updated 12:39 p.m., Mar. 10, 2025
Iowa Capital Dispatch is part of States Newsroom, a nonprofit news network supported by grants and a coalition of donors as a 501c(3) public charity. Iowa Capital Dispatch maintains editorial independence. Contact Editor Kathie Obradovich for questions: info@iowacapitaldispatch.com.
