Ontario slaps 25 percent increase on electricity exports to U.S. in response to Trump's trade war

Ontario's premier, the leader of Canada’s most populous province, announced that effective Monday it is charging 25 percent more for electricity to 1.5 million Americans in response to U.S. President Donald Trump's trade war.

Ontario provides electricity to Minnesota, New York and Michigan.

“I will not hesitate to increase this charge. If the United State escalates, I will not hesitate to shut the electricity off completely,” Ontario Premier Doug Ford said at a news conference in Toronto.

"Believe me when I say I do not want to do this. I feel terrible for the American people who didn't start this trade war. It’s one person who is responsible, it’s President Trump.”

Ford said Ontario’s tariff would remain in place despite the one-month reprieve from Trump, noting a one-month pause means nothing but more uncertainty.

Ford's office said the new market rules require any generator selling electricity to the U.S. to add a 25 percent surcharge. Ontario's government expects it to generate revenue of $300,000 Canadian dollars (roughly $208,000 American dollars ) to $400,000 Canadian ($277,000 American) per day, “which will be used to support Ontario workers, families and businesses.”

Ontario’s power grid operator said the amount of electricity exported to Minnesota is a fraction of what it sends to Michigan and New York.

The new surcharge is in addition to the federal government's initial $30 billion ($21 billion) worth of retaliatory tariffs have been applied on items like American orange juice, peanut butter, coffee, appliances, footwear, cosmetics, motorcycles and certain pulp and paper products.

Trump launched a new trade war last week by imposing tariffs against Washington’s three biggest trading partners, drawing immediate retaliation from Mexico, Canada and China and sending financial markets into a tailspin.

Trump later said he has postponed 25 percent tariffs on many goods from Canada and Mexico for a month, amid widespread fears of a broader trade war.

Ford estimated it will add about $100 Canadian dollars ($69 American) a month to the bills of each American affected.

“It needs to end. Until these tariffs are off the table, until the threat of tariffs is gone for good, Ontario will not relent,” Ford said.

Ford said Trump changes his mind every day, but if he continues to attack Canada he will do everything it takes to maximize the pain.

“Republicans, at least the ones I speak to, do not agree with President Trump but they are too scared to go out there and say it publicly,” Ford said. “It's a shame but we need to end this.”

Trump has urged U.S. automakers to move auto production from Canada and Mexico to the U.S. Last week Trump granted a one-month exemption to 25 percent tariffs on vehicles and auto parts traded through the North American trade agreement USMCA after speaking with leaders of automakers Ford, General Motors and Stellantis.

Premier Ford also noted Trump is threatening Canada with steel, aluminum and diary tariffs.

“I will do whatever it takes to maximum the pain against Americans,” Ford said.

Stephen Lecce, Ontario's minister of energy and electrification, said the U.S. needs Canada's power and it could impact other states as well as the three states often resale Ontario's electricity. “It is regrettable we are here,” Lecce said.

Trump’s trade war and his talk of making Canada the 51st U.S. state have infuriated Canadians, who are booing the American anthem at NHL and NBA games. Some are canceling trips south of the border, and many are avoiding buying American goods when they can.

Ford's Progressive Conservative government just won reelection by standing up for Canada against Trump.

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