Electricity demand is set to boom in Canada by 2050, according to new modelling from the national energy regulator released on Tuesday.

The projections also foresee robust growth in natural gas production and expansion of renewable power in the country.

The latest modelling from the Canada Energy Regulator (CER) focuses on an expected spike in power demand from coast to coast as consumption grows 44 per cent from 2023 to 2050.

The increase is driven by residential and industrial demand, in addition to the technology sector, such as AI data centres.

Meanwhile, the capacity of the country’s electricity system is projected to double from 160 gigawatts in 2023 to 310 gigawatts in 2050. The increase in production will be driven mostly by wind energy, which could expand from 40 terawatt-hours of generation in 2023 to 277 terawatt-hours by 2050, the CER says.

“While the largest incremental source of generation is wind energy, we also see a rise in solar, and these variable power sources are supported by higher generation for more stable and dispatchable sources including hydroelectricity, nuclear and natural gas,” said Darren Christie, the CER’s chief economist.

“We also see power lines between provinces play a growing role in balancing the variations in electricity supply and demand,” said Christie, as total interprovincial transmission capacity is projected to grow by about 70 per cent by 2050.

Ontario is expanding its nuclear power with the construction of the first of four small modular nuclear power plants, at a total cost of more than $20 billion. Other provinces, including Alberta and Saskatchewan, are pursuing similar nuclear projects.

The modelling also predicts consumption of oil and natural gas will remain relatively unchanged over the decades to come, with fossil fuel use increasing by one per cent by 2050 compared to 2023.

Different oil production scenarios

Natural gas production is projected to increase from about 19 billion cubic feet per day in 2025 to reach between 21 billion and 32 billion by 2050. The amount of growth will hinge on the number of liquified natural gas (LNG) export facilities that will be built. 

Currently, only one LNG facility on the West Coast is operational, while a handful of others are in development or under construction.

“We could see more, we could see less, but the real story is that it’s a major driver of the growth that we’re projecting in natural gas production,” said Christie.

The CER’s modelling for the oil production is unclear over the long term, largely because of factors such as uncertain global commodity prices. Canada’s oil production could jump by 18 per cent by 2050, or contract by 12 per cent.

The CER released four different scenarios, including its traditional baseline, which projects oil production will peak at 6.1 million barrels per day by 2042, before flattening to 5.9 million by 2050.

Currently, oil production is at record levels and is forecast by experts to climb over the next five years.

All four scenarios project greenhouse gas emissions to decline over the decades to come, largely because of a cleaner electricity grid and improved environmental performance in most parts of the economy.

Still, the traditional baseline scenario projects emissions to plateau in 2035 under current policies.

Reaching net-zero emissions by 2050 would “require an economy-wide transformation” toward low carbon technologies, according to the latest CER energy outlook.

The national energy regulator released its first outlook in 1967. The most recent report is the first update since 2023.