Ontario agrees to suspend electricity surcharge ahead of talks with US
The government of Ontario on Tuesday backed off its threat to impose a surcharge on electricity to three U.S. states amid broader trade talks.
In a joint statement from Ontario Premier Doug Ford and Commerce Secretary Howard Lutnick, the two leaders said they had a “productive conversation about the economic relationship between the United States and Canada.”
The two said they would meet in person in Washington on Thursday to discuss a renewal of the U.S.-Mexico-Canada trade agreement ahead of reciprocal tariffs set to go into effect on April 2.
“In response, Ontario agreed to suspend its 25 percent surcharge on exports of electricity to Michigan, New York and Minnesota,” Ford and Lutnick said.
President Trump confirmed the agreement in comments to reporters at the White House.
"As you know, there's a very strong man in Canada who said he was going to charge a surcharge or a tariff on electricity coming into our country. He has called, and he said he's not going to do that," Trump said. "And it would've been a very bad thing if he did, and he's not going to do that, so I respect that."
Trump earlier Tuesday had threatened to double planned steel and aluminum tariffs on Canada beginning Wednesday, citing Ontario’s decision to put a charge on electricity exports.
A White House official did not immediately respond to a request for comment about whether he would still carry out that threat, but Trump indicated he would likely back off.
"Now I'm looking at that," Trump said. "But probably so. He was a gentleman.”
The Trump administration is set to impose across-the-board 25 percent tariffs on steel and aluminum Wednesday, but Trump posted on Truth Social that he was directing Lutnick to increase the tariffs on Canadian imports of the metals from 25 percent to 50 percent.
The United States in 2024 imported more steel and aluminum from Canada than from any other country.
Trump earlier Tuesday threatened additional tariffs against Canada in the coming weeks, pointing to plans for his administration to impose reciprocal tariffs beginning April 2 on all countries with duties on U.S. products. Those included tariffs on cars, which Trump claimed would “essentially, permanently shut down the automobile manufacturing business in Canada.”
The president earlier this month announced 25 percent tariffs on imports from Canada and Mexico, though he has announced one-month exemptions for car parts and other goods that fall under the U.S.-Mexico-Canada trade agreement signed in 2020 during his first term.
The uncertainty around Trump’s tariff plans have led to a downturn in the stock market, and the president has not ruled out the possibility of a recession this year.
— Updated at 3:36 p.m. EDT
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