Powering Canada Forward Fund

The Canadian Climate Institute proposes a Powering Canada Forward Fund (PCFF) to address the financial challenge of scaling Canada's electricity grid. Because current regulatory models pass the cost of new infrastructure immediately to ratepayers, there is a risk that rising bills will deter the electrification needed for climate goals. The PCFF would use federal funding to cover the gap between utility costs and customer receipts, deferring the cost of anticipatory build-out until new demand arrives to share the burden. This mechanism shifts demand risk from ratepayers to the federal government and ensures that the benefits of a larger, more efficient system are shared across generations of users.

• Rapid growth in electricity demand, driven by electrification and new industrial investments like data centres, creates a risk that the high capital costs of expanding the grid will lead to electricity rate hikes that deter further electrification.
• Current electricity regulation in Canada is designed to prevent over-investment by monopoly providers but lacks mechanisms to handle the cost of 'underbuilding' or the need to build infrastructure ahead of the customers who will eventually use it.
• The proposed Powering Canada Forward Fund (PCFF) would function as federally underwritten funding to cover the annual gap between a utility's revenue requirements and its actual receipts, keeping customer unit prices flat in real terms during the transition.
• The PCFF shifts the financial risk of demand falling short of projections from provincial ratepayers to the federal government and taxpayers, which is justified by the federal government's larger balance sheet and its role in driving demand through immigration and industrial policy.
• To prevent moral hazard and ensure efficiency, the fund would require projects to pass a 'national benefits test' and could make payments conditional on the modernization of provincial electricity systems.
• The PCFF is intended to complement the Canada Infrastructure Bank (CIB); while the CIB de-risks specific projects through blended finance, the PCFF manages system-level financial risk and the timing of cost recovery for ratepayers.
• The fund's scope could potentially expand beyond transmission and battery storage to include clean power generation, electric vehicle charging networks, and electrified public transit systems.

APA

Liebreich, M. (2026). Powering Canada Forward Fund. Canadian Climate Institute. https://climateinstitute.ca/policy-brief-powering-canada-forward-fund/

Chicago

Liebreich, Michael. Powering Canada Forward Fund. Canadian Climate Institute, 2026. https://climateinstitute.ca/policy-brief-powering-canada-forward-fund/.

Wikipedia

{{cite report |last1=Liebreich |first1=Michael |title=Powering Canada Forward Fund |publisher=Canadian Climate Institute |date=22 July 2026 |url=https://climateinstitute.ca/policy-brief-powering-canada-forward-fund/ |access-date=23 October 2026 |via=Climate Insights Directory}}

BibTeX

@techreport{liebreich2026powering, author = {Liebreich, Michael}, title = {{Powering Canada Forward Fund}}, institution = {Canadian Climate Institute}, year = {2026}, month = jul, url = {https://climateinstitute.ca/policy-brief-powering-canada-forward-fund/}, urldate = {2026-10-23}, note = {Indexed by Climate Insights Directory} }