Ontario’s Energy Plan Unlocking Opportunities in the Digital Economy

July 2, 2025

New measures will prioritize electricity for data centres that create good-paying jobs and strengthen Ontario’s economy

KITCHENER – The Ontario government is taking action to prioritize electricity for data centres that support the province’s economic interests, including those that create high-quality jobs, assist in domestic data hosting and strengthen Ontario’s position in the digital economy. As part of the government’s plan to protect Ontario, the province is embracing the growth of the data centre sector as a strategic opportunity to drive investment, innovation and job creation. This approach is grounded in Ontario’s new integrated energy plan, the province’s strategy to secure the clean, reliable and affordable power needed to support economic growth in high-demand sectors like digital technology.

This Canada-first plan will prioritize and accelerate approvals for data centres that deliver measurable benefits to both local communities and to the province’s long-term competitiveness. This will include good-paying jobs for Ontarians, securing local data storage and creating a stronger, more competitive economy. This new plan will:

Ensure that data centres that support the province’s economic interests, including those that create high-quality-jobs, strengthen our digital economy and support domestic data housing are quickly approved for connection to the grid.
Ensure Canadian data stays in Canada and is protected from misuse and weaker foreign privacy regimes.
Explicitly require approval before certain data centres can connect to Ontario’s electricity grid, ending automatic approval for large energy-intensive loads so that the province can prioritize data centres that support its plan to protect Ontario.

The current load data centres requesting to be connected to Ontario’s grid represents approximately 30 per cent of Ontario’s peak demand in 2024, or the output of a nuclear plant the size of Bruce Power Nuclear Generating Station. With over 6,500 megawatts of data centres requesting to be connected to the grid, demand for electricity from the data centre industry, which includes artificial intelligence and cloud computing, is growing and expected to represent 13 per cent of new electricity demand in Ontario by 2035.

“Technology is the future. To ensure we are always on the leading edge as we attract good-paying jobs, we need to further protect Canadian sovereignty and data,” said Stephen Lecce, Minister of Energy and Mines. “These measures will ensure we’re not just plugging in servers – we’re powering Canadian opportunity, protecting Canadian data and jobs and making sure energy is used where it delivers real value to our country.”

As global demand for AI, cloud computing and data processing increases, the government introduced new legislative measures in the Protect Ontario by Securing Affordable Energy for Generations Act, 2025, that will, if passed, require data centres to obtain approval before connecting to the electricity grid. Currently, electricity utilities are required to connect all data centres indiscriminately, regardless of economic impact or energy consumption needs. These changes will welcome new investment and job creation by allowing Ontario to manage electricity connection requests and prioritizing data centres that deliver real local, strategic and economic benefits that enhances Ontario’s competitiveness, energy security and long-term prosperity.

“Ontario’s data centres are a vital part of our province’s technology landscape, as they provide the foundation of our growing digital economy and the security of our data,” said Sam Oosterhoff, Associate Minister of Energy-Intensive Industries. “As we experience increasing energy demands — not only from our energy-intensive industries, but also from the pressures of attracting new investment to the province — we have to ensure we are taking action to prioritize projects that create good jobs and get these projects connected to the energy they need. This policy will protect and promote data centres, while also protecting our ability to attract large manufacturing facilities to our province.”

This initiative is part of Energy for Generations, the government’s long-term approach to make sure Ontario has the reliable, affordable energy it needs to be energy secure and power economic growth. The government’s integrated approach and record investments in energy infrastructure are also providing the certainty needed for Indigenous communities, municipalities, businesses and industry partners to invest confidently in Ontario’s future. With a clear path forward, the plan not only helps meet the demands of today but will help protect workers and the economy by keeping workers on the job and powering growth and opportunities for generations to come.

Quick Facts

According to the National Cyber Security Index, Canada scores 96.67 out of 100, ranking second in the world. The ranking is based on the nation’s preparedness in preventing and managing cybersecurity threats. The exceptional ranking signals to data centre providers that Canada is a safe and dependable location for new data center developments.
The worldwide data centre construction market is projected to reach $49 billion by 2030. Canada is among the top ten largest data centre markets, with $8 billion in revenue, and it has the potential to move up to the top five. Spending on servers is the fastest-growing segment of the data centre sector in Canada, and it is forecasted to grow by 66 percent by 2029, reaching approximately $4 billion in value.
The 2021 report ‘Foreign Interference Threats to Canada’s Democratic Process‘ specifically noted that Canada’s abundance of natural resources makes it a target for foreign interference.
Ontario’s electricity grid is one of the cleanest in the world with a diverse supply mix made up of nuclear, hydroelectric, natural gas, wind, solar and bioenergy.
By 2035, electricity demand from electrifying Ontario’s industrial sector is expected to increase by 58 per cent – the equivalent of adding 2.7 million homes to the grid.
Energy for Generations builds on the 2024 vision paper Ontario’s Affordable Energy Future: The Pressing Case for More Power that received 136 submissions to the public consultation from Indigenous communities, municipalities, utilities, stakeholders and the public.
The Protect Ontario by Securing Affordable Energy for Generations Act, 2025, if passed, will support major growth in the province’s energy system to meet rising demand, while keeping energy affordable, secure, reliable and clean for generations to come.