Energy Trade 101

Like many products made or used in Atlantic Canada, energy is often traded (purchased or sold) across provincial and international borders.

Energy systems within the Atlantic provinces are very integrated (electricity, gasoline, natural gas, etc.) and trade between the four provinces is constant. The Atlantic provinces also trade energy to other provinces and internationally, especially with the six states in New England (Maine, New Hampshire, Vermont, Massachusetts, Connecticut and Rhode Island).

What is trade?

Different types of energy, like nearly all products and services, are traded, or purchased and sold, across provincial and international borders every minute.

Exports are products or services that a business in one country sells to customers in another country. This also happens from state-to-state or province-to-province (known as interprovincial trade). A familiar example for exports would be electricity generated by hydroelectric dams in Newfoundland and Labrador being sold to customers in the United States (some via Québec).

Exports impact an economy by increasing revenue for the seller’s economy, growing the Gross Domestic Product (GDP). GDP increases as an economy exports more than it imports. Exports are good because they essentially use money from the customers’ country to help generate jobs and taxes in the seller’s country.

Imports are products or services that a producer in another country sells to customers here. An example would be natural gas, which flows largely from western Canada and the United States through New England and eventually to thousands of customers in New Brunswick and Nova Scotia.

Source: Atlantica’s Fuel for Thought Podcast, Energy Trade 101: How does energy trade impact New England and Atlantic Canada?

Imports are often considered less helpful for an economy than exports, but they are still important. Atlantic Canada does not or cannot produce everything used in the region (from producing natural gas to fuel manufacturing businesses to growing oranges in the winter). Imports are also important because many Atlantic Canadian businesses add value to raw products imported from another country, such as importing crude oil and refining it to make gasoline and diesel.

A trade balance is the difference between what a country imports and exports. If it imports relatively too much, it has a trade deficit, which can devalue its currency.

What are tariffs?

Tariffs are essentially a tax imposed by a government on certain imported goods or services. For example, electricity or seafood exported from Canada to the United States could be tariffed at 10% (adding 10% to the cost of the electricity or seafood purchased). The revenues from the tariff would be paid by the United States’ customer purchasing them, and the revenues collected would go to the United States’ federal government.

Tariffs ultimately drive-up costs for customers, especially if the imports can’t be produced locally or imported from a supplier in another country instead. For example, if the electricity needed could only come from Canada, United States’ customers needing this energy could need to pay the added tariff. Conversely, if lobster from Canada instead could be purchased from other suppliers in the United States, or from another country, United States’ customers could purchase different lobster and avoid paying the tariff.

Tariffs can be used by a country to encourage more production within their country, but in many cases, likely with some types of energy, alternatives aren’t always available quickly or affordably.

How much energy is imported to Atlantic Canada (from outside of Canada)?

In 2023, $29.8 billion worth of products were imported to Atlantic Canada from outside of Canada. $10.3 billion of these products were imported from the United States. (Government of Canada, Trade Data Online)
Energy products represented a significant share of the total imports to the region, including:
- Crude oil – $10.7 billion;
- Oil (not crude) – $2.9 billion;
- Gaseous hydrocarbons (e.g. natural gas, propane) – $358 million;
- Coal – $335 million;
- Electricity – $30 million; and,
- Biodiesel – $12 million.
Roughly half of Atlantic Canada’s energy imports in 2023 came from the United States. Most of these imports (crude oil) come to New Brunswick.
Most fossil fuel oils imported are refined, which adds value to the region, and the majority is later exported to the United States.
In 2023, Newfoundland and Labrador imported $77 million of soya-bean oil to produce biofuels. These imports increased to $913 million in 2024.
Many components and chemicals used to generate electricity and refined petroleum products, among other energy sources, are also imported to the region.
Energy products are imported to Atlantic Canada in several ways, mostly through transmission lines, pipelines and by ship.

In 2023, $38.3 billion worth of products were exported from Atlantic Canada to international customers. The majority of these exports ($26.3 billion) went to the United States. (Government of Canada, Trade Data Online)
Energy products contributed significantly to Atlantic Canadian international exports, including:
- Petroleum products (not crude) – $9.5 billion;
- Crude oil – $6.8 billion;
- Petroleum coke (and other residues) – $683 million;
- Electricity – $458 million;
- Gaseous hydrocarbons (e.g. natural gas, propane) – $373 million
- Fuel wood (e.g. wood pellets) – $125 million
- Biofuels – $51 million
In 2024, Newfoundland and Labrador also exported biofuels ($724 million).
Most energy exports from Atlantic Canada come from refined petroleum products from New Brunswick (e.g. gasoline, diesel, etc.) and crude oil from Newfoundland and Labrador.
All electricity exports ($458 million) and almost all refined petroleum products ($9.3 billion) were exported to the United States. Nearly half of crude oil exports ($3.1 billion) went to the United States as well.
Most electrical exports are from New Brunswick ($389 million), with smaller amounts from Newfoundland and Labrador ($69 million).
Energy products are exported from Atlantic Canada in several ways, mostly by ship, pipeline and transmission line. Interprovincial trade also happens using some trucking and can use rail.

What role will energy trade play in Atlantic Canada’s net-zero future?

Trading energy internationally can play an important and growing role in Atlantic Canada’s net-zero future.

It is reasonable to expect that energy trade between the Atlantic provinces and United States, especially the New England states, will continue in the future as both regions benefit. For examples, 8 in 10 cars on the road in New England are powered with Canadian fuel. The New England states forecast electricity demand will increase from 119,000 GWh in 2024 to 140,000 GWh in 2033, and Atlantic Canada’s world-class onshore and offshore wind resources could help meet this growing demand.

Several clean fuel projects are in development across Atlantic Canada including hydrogen and sustainable aviation fuel, which is planned to export energy to European customers. It is reasonable to expect that Atlantic Canada’s future trade will see energy exports grow to serve existing and new markets, enabling diversification while growing the local energy sector.