How transforming Canada’s electricity grid could drive decarbonization, save billions

Canada can save billions in unnecessary and unsustainable capital expenditures by pivoting now to renewables-based, emission-free electricity generation; a coast-to-coast transmission link; and smart grid technologies.

The vision of a decarbonized, interconnected, resilient national power grid is at the heart of recent analysis by Corporate Knights’ Climate Dollars project that sets out an ambitious plan for a zero-emission economy by 2050, all while securing and revitalizing the local economies that are the cornerstone of our national sovereignty.

It is a grid that we have only recently imagined, one based on millions of distributed, renewable generators rather than dozens of central power plants. It requires capital investments in solar, wind and storage technologies that total $700 billion over the next 25 years, in addition to the roughly equal amount of capital needed to electrify the buildings and vehicles. The capital cost for the grid investments averages $28 billion per year from now until 2050 and is below current investment level in the electric power sector in Canada, which totaled $32 billion in 2024 and is projected to reach $34.5 billion this year.

But while this total investment is well within the capacity of Canadian capital spending, realizing such a sustainable outcome requires that government make the right choices now, that both new and existing buildings are fossil fuel–free, that we develop vehicle-to-grid infrastructure that feeds the energy of EV batteries back into our grid, and that we stop building new fossil and nuclear plants.

The renewable grid builds on our current hydroelectric base and leans into the wind and solar resources that Canada has in abundance, and that are leading global growth in electricity generation investment.

• Sized to provide for the growth in electrification of buildings and vehicles, the scenario includes up to 100,000 wind turbines and 100 million solar panels to be built across Canada over the next 25 years.
• The batteries in tens of millions of interconnected electric vehicles will provide the energy storage to ensure a reliable grid, 24 hours a day, 365 days per year. By 2050, vehicle-to-grid technology cuts the cost of the national grid by half – even after putting money in vehicle owners’ pockets by compensating them for access to their batteries.

Every part of the Climate Dollars scenario is built on technologies that are proven, affordable and beginning to scale up. Getting it done will depend on government leadership in clearing regulatory and other barriers to rapid action, and an accelerated response from businesses and investors who see opportunities to prosper generated by a positive, pragmatic response to the climate emergency.

The Trans-Canada Transmission Link

At the heart of the transition scenario is what we are calling the Trans-Canada Transmission Link, a bold nation-building project as central to our future as the Trans-Canada Railway and Highway were to our past. It’s a coast-to-coast, high-voltage DC transmission line that will foster interprovincial trade in electricity to bring down the cost of decarbonization while supporting broad distribution of the benefits of the hundreds of billions of dollars of investment in renewable electricity through the coming transition.

A Trans-Canada Transmission Link will also be a more efficient means of transporting energy across the country than a new pipeline. As the energy transition unfolds, the link could transport gas-powered electricity generated in Alberta to Eastern Canada faster than pushing the gas across the country in a pipeline, with an important added benefit: the Trans-Canada Transmission Link will not be obsolete after the transition to zero-carbon sources is complete. The link will give each province access to electricity-generating capacity in any of the others, with different parts of the country using and consuming power at different times of day. With the grid itself as a coordinating point, Manitoba sunshine will be able to power the dinner-hour peak in Halifax, while Quebec’s summer winds supply morning electricity for office towers in Calgary and Edmonton.

Why Canada needs a coast-to-coast power grid