Ensuring the greenest, cleanest gigawatts satisfy Canada’s ballooning hunger for electricity will mean investing in a diverse suite of innovations and technologies, a Deloitte Canada energy expert outlined to Sustainable Biz Canada.

A growing economy and population will require anywhere from a 47 per cent boost to a doubling or tripling of electricity production from now to 2050, depending on the climate pathway.

In the background are Canada’s climate goals, such as a proposed net-zero grid by 2035 and net-zero overall by 2050, demanding a surge of clean energy. Over 80 per cent of the country’s electricity is zero- or low-emitting, but tackling the lingering hardest-to-abate emissions presents a challenge.

Though Canada has “hit the ground running with a very clean system already, the challenge is to significantly expand that system while not increasing the emissions associated with an already low-emitting system,” Duncan Rotherham, a Deloitte partner who leads the firm’s sustainability and energy practice, said.

It will demand over $1 trillion in funding nationally and a massive build-out and upgrading of infrastructure. But “Canada is blessed with the resources, geography and geology in order to make that happen,” he added.

What the future of Canada’s electricity could look like

Electricity is expected make up more of Canada’s energy profile, prompted by increasing adoption of electric vehicles, swapping gas-powered industrial equipment with electric arc furnaces, and construction of more buildings, housing and data centres, Rotherham said.

PwC projects electricity demand to reach 1,300 terawatt-hours by mid-century, more than double from 2023. A 2050 net-zero scenario by the Canadian government predicts wind generation will make over a quarter of the electricity in the country, with small modular nuclear reactors contributing around 12 per cent.

An incremental build-out of renewable energy (wind and solar particularly), paired with energy storage, nuclear power, hydrogen fuel, and gas-fired stations integrating carbon capture are the lowest-carbon options Rotherham sees as meeting the electricity demand.

He also expects distributed energy resources — smaller, decentralized energy generation near the source of demand — to be popularized with more rooftop solar and battery systems installed in homes.

Natural gas will likely persist in the energy mix because of its effectiveness and reliability for heating and electricity, he added. Maintaining natural gas presents a dilemma, as meeting climate goals requires phasing out fossil fuels, but substituting it with heat pumps and geothermal energy would be “an incredible expansion of the electric system just to meet the heat load,” unlikely to be built on time.

Rotherham stressed the stability of nuclear power as a reliable, non-emitting energy source. Intermittent renewable sources matched with energy storage will need to be built or face long stretches when generation is limited, requiring some baseload energy.

“It’s capital intensive, but we’ve proven our ability to execute in that space very well in Canada” he said about nuclear energy, proven by the refurbishments of reactors in Ontario.

How infrastructure needs to change

Adaptation will present opportunities and challenges for grids, Rotherham said.

There will be more options for reliable, affordable, sustainable electricity systems, but there is currently limited visibility and control of resources.

Cost-effective technology can help rectify the problems, he suggested. Utilities could control demand, switching off air conditioning on a very hot day to better manage the electricity load at peak hours, for example.

With climate change amplifying extreme weather events that can disrupt electricity infrastructure, utilities are improving the data collection and analysis to understand the risks. That information can be used to figure out where to make investments into durable utility poles or moving above-ground infrastructure underground, and using smart grids that predict when major storms will happen so preparations can be made.

Rotherham named other innovations as areas to watch, such as digital twins, drones discovering problems with grids ahead of time, and artificial intelligence-powered tools that enable proactive responses.

‘Darwinian competition’ for energy

Crucial to understanding the transition is how grids differ by province, the Deloitte partner explained. Alberta and Nova Scotia have relatively high-emitting grids compared to Quebec and British Columbia, as laid out in Deloitte’s Bright Ideas 2024 report.

“This is a marathon, not a sprint. And the race will be run at different velocities and different costs at different provinces,” Rotherham summarized.

Canada's initial 2035 net-zero grid target was altered because Alberta and Saskatchewan’s premiers opposed such a goal. The federal government relented to allow some natural gas power generation. Yet the “outcome might not be that different from exactly what dispatches and where,” Rotherham said.

A natural transition is happening in the energy market that favours clean energy, he explained, akin to a “Darwinian competition for capital” as potent as government incentives and regulations.

Coal-fired generation is being phased out as regulations and carbon pricing are being factored in. Clean energy technology such as renewable energy and batteries from a cost-benefit perspective are more competitive than fossil fuels.

Canada has the ambition to deliver both clean energy and grow the economy, Rotherham said, and the country’s superpower is the combination of abundant natural resources, labour, intellectual property and existing clean energy.

“If we can’t do it here, I would estimate that the rest of the world is even more significantly challenged.”