'I don't think they have a case': Why Danielle Smith is playing hardball with the U.S. on electricity trade

OTTAWA — Alberta Premier Danielle Smith has embraced the role of “good cop” in Canada’s trade turmoil with the United States, but she’s not exactly playing nice with neighbouring U.S. state Montana amidst a brewing electricity dispute. 

Speaking on her call-in radio show this weekend, Smith dismissed claims that recent changes to Alberta’s electricity market unfairly limit imports of power from Montana, saying the regulations treat it the same as other jurisdictions.

Smith said she wouldn’t let Montana-based companies cajole her into giving them special treatment under the guise of fairness.

“They want to be able to sell to us when the price is high and sell somewhere else when the price is high,” said Smith to a caller who asked about the dispute. “And we just say, if you’re going to play in our market, you’ve got to follow the same rules as everyone else.”

“I don’t think they like the change in the rules, but it applies fairly to everyone, so I don’t think they have a case there,” said Smith.

Smith’s defence of provincial energy policies comes after weeks of criticisms from American officials, including U.S. Senators Steve Daines and Tim Sheehy , both of Montana. Daines’s office told the Canadian media in January that it was “unfortunate Alberta has levied a number of rules and regulations that discriminate against Montana electricity producers that ultimately undermine the stability of Montana’s grid.”

And it’s not just state officials who’ve taken notice. U.S. Trade Representative Jamieson Greer mentioned “Alberta’s unfair treatment of electrical power distribution providers in Montana” in remarks he gave to Congress in December about barriers to the renewal of the Canada- U.S.-Mexico Agreement (CUSMA) .

Here’s what you need to know about the cross-border electricity tiff that has Alberta and Montana at loggerheads.

Alberta’s electricity market has changed dramatically in recent years as its phased out coal and concurrently scaled up renewable sources of electricity like solar panels and wind turbines. As wind and solar are intermittent sources of energy , meaning they produce varying levels of output with changing weather conditions, Alberta’s energy grid frequently oscillates between periods of surplus and deficit.

This has led to Alberta cutting electricity imports, including from Montana, at times when there’s a glut of locally generated power. It’s a change that’s rewiring Alberta’s energy relationship with several of its neighbours.

Jack Mintz, an economist at the University of Calgary who’s written extensively on energy policy, says this is a “technical issue” that’s being fashioned into a trade issue.

“Alberta’s electricity market is still catching up to a rapidly changing energy mix, and they’ve come up with this sort of ad hoc solution where they’re shutting off everybody at times when domestic generation is surging,” said Mintz.

Politicians and energy companies across the border say they’re not responsible for Alberta’s poor planning, and its sudden shift to renewables shouldn’t leave Montana holding the bag.

Montana State Senator Daniel Zolnikov said in a recent appearance on Canadian television that Alberta should have done its due diligence before making the shift.

“You can’t do that kind of upgrade without making sure that the new type of resources can balance on the grid, and (Alberta) did not do that,” said Zolnikov.

This issue was flagged in early 2024 by a division of U.S. billionaire Warren Buffett’s Berkshire Hathaway, which filed a discrimination complaint with Alberta’s utilities regulator stating that the province failed to make necessary additions to the grid that would put imported power on a level playing field.

Mintz says that state officials are using the looming CUSMA review to exert additional pressure on Alberta.

Daines, Sheehy and two Montana state representatives wrote to Greer in July 2025 drawing his attention to “escalating discriminating trade practices … against Montana energy firms trading in the Alberta electricity market,” five months before Greer raised this issue to Congress.

Mintz says he agrees with Smith that Montana-based electricity companies don’t have a strong claim to being discriminated against on the basis of nationality, noting that they themselves admit that other Canadian provinces face similar barriers.

He says that the obvious solution would be for Montana to help Alberta pay to build new transmission lines.

“Montana is saying, look, we could have this integrated cross-border market with cheap electricity on both sides. But to do that, you need improve the transmission lines,” said Mintz. “So, if Montana really wants the integrated market, maybe they can negotiate some sort of agreement with Alberta on building those out.”

Mintz said that sufficiently upgrading transmission lines between the two jurisdictions would cost around $500 million.

National Post rmohamed@postmedia.com

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