Electricity demand in Canada is expected to experience significant growth by the year 2050, as indicated by new projections from the national energy regulator unveiled on Tuesday. The forecasts also anticipate a substantial increase in natural gas production alongside the expansion of renewable energy sources across the nation.
The latest modeling from the Canada Energy Regulator (CER) highlights an anticipated surge in power consumption from one end of the country to the other, projecting a 44% increase in demand from 2023 to 2050. This growth is primarily attributed to rising residential and industrial needs, as well as the technology sector, particularly AI data centers.
Furthermore, the capacity of Canada’s electricity system is set to double from 160 gigawatts in 2023 to 310 gigawatts by 2050. The boost in production will be predominantly fueled by wind energy, which is expected to grow from 40 terawatt-hours in 2023 to 277 terawatt-hours by 2050, according to the CER.
Darren Christie, the CER’s chief economist, emphasized the rising prominence of wind and solar energy sources, supported by stable options like hydroelectricity, nuclear power, and natural gas. Additionally, Christie highlighted the increasing importance of interprovincial power lines for balancing electricity supply and demand, with total interprovincial transmission capacity projected to increase by approximately 70% by 2050.
In Ontario, the construction of the first of four small modular nuclear power plants is underway, with a total cost exceeding $20 billion. Similar nuclear projects are also being pursued in provinces such as Alberta and Saskatchewan. The modeling suggests that oil and natural gas consumption will remain relatively steady in the coming decades, with a slight 1% increase in fossil fuel usage by 2050 compared to 2023.
Regarding natural gas production, the projections indicate growth from around 19 billion cubic feet per day in 2025 to a range between 21 billion and 32 billion by 2050, contingent on the development of liquefied natural gas (LNG) export facilities. The uncertainty surrounding global commodity prices makes long-term oil production projections ambiguous, with possibilities of an 18% increase or a 12% decrease by 2050.
The CER has outlined four different scenarios for oil production, including a traditional baseline that predicts a peak of 6.1 million barrels per day by 2042, tapering to 5.9 million by 2050. Current oil production levels are at a record high and are expected to climb over the next five years.
All scenarios forecast a decline in greenhouse gas emissions in the coming years, attributed to a cleaner electricity grid and improved environmental practices across various sectors. However, under the traditional baseline scenario, emissions are expected to plateau in 2035 without additional policy interventions.
Achieving net-zero emissions by 2050 would necessitate a comprehensive shift towards low-carbon technologies, according to the latest CER energy outlook. The national energy regulator’s most recent report marks the first update since 2023, following its initial energy outlook publication in 1967.