Ontario suspending U.S. electricity surcharge after White House ‘olive branch’

Ontario suspending U.S. electricity surcharge after White House ‘olive branch’

Ontario Premier Doug Ford says his government is suspending its 25 per cent surcharge on electricity exports to three U.S. states after securing a meeting in Washington with the commerce secretary.

A day filled with escalation between Ford and U.S. President Donald Trump crescendoed toward Ford’s announcement that the surcharge he introduced on Monday would be suspended after the White House extended an “olive branch.”

Ford and U.S. Commerce Secretary Howard Lutnick released a joint statement on Tuesday afternoon saying Ford and federal Finance Minister Dominic LeBlanc had been invited to the White House.

The invitation will see Ford travel to Washington, D.C., on Thursday to meet with Trump’s commerce team. The premier said he wasn’t sure if he’d meet the president himself.

While Ontario removed its 25 per cent surcharge on energy sold to the U.S. barely 24 hours after it was introduced, the U.S. has not said whether it would go ahead with the 50 per cent tariffs on steel and aluminum imposed in response.

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Ford told reporters at Queen’s Park on Tuesday that Lutnick would “bounce” the idea of dropping the added steel and aluminum tariff “off the president.”

Trump later said he would “probably” not go ahead with the extra tariffs. The White House then confirmed 25 per cent tariffs would go ahead on steel and aluminum, but the extra 25 per cent planned for Canada would not.

Lutnick called Ford on Tuesday afternoon to discuss the tariff war and invite him to Washington after a-day-and-half of fevered escalation.

Earlier Tuesday, Trump took to his social media site, Truth Social, calling out Ford’s policy and announced retaliation. Ford appeared on American airwaves, promising Ontario wouldn’t back down and wouldn’t change its promised approach.

The White House then named Ford directly during its afternoon briefing.

“The president saw the premier, Doug Ford, make an egregious and insulting comment threatening to shut down electricity for the American people,” White House press secretary Karoline Leavitt said.

“He made that threat. The president saw that and has an obligation and a responsibility to respond accordingly and represent the interests of the American people.”


Click to play video: '‘Won’t back down’: Doug Ford hits US with 25% electricity tax amid trade war'


‘Won’t back down’: Doug Ford hits US with 25% electricity tax amid trade war


Ford’s 25 per cent surcharge would have applied to energy exported to Michigan, Minnesota and New York as a response to tariffs on Canadian products brought in by the White House.

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In his Tuesday morning post, Trump said he would “permanently shut down” the automobile manufacturing industry in Canada if Ontario does not back down. He has threatened tariffs on Canada’s auto sector on April 2. He also repeated his threat of making Canada the 51st state of the United States.

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The brinkmanship, however, ultimately came before a temporary pause in hostilities confirmed just before 3 p.m.

“Rather than going back and forth and having threats to each other, we have both agreed that cooler heads prevail — we need to sit down and move this forward,” Ford said at Queen’s Park. “This is a massive, massive deal.”

He said the federal government would lead work on broader trade negotiations with the Americans and that Ford, as head of the Council of the Federation, would speak to Canada’s premiers on Wednesday.


Click to play video: '‘Stay tuned’: Doug Ford on the possibility of more energy tariffs on the U.S.'


‘Stay tuned’: Doug Ford on the possibility of more energy tariffs on the U.S.


As part of the call between Ford and Lutnick, which brought the temporary pause, the premier was invited to the White House. Ford said that move shifted his previously firm stance that Ontario would not remove any of its reciprocal measures until the U.S. promised “zero tariffs.”

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“It’s called an olive branch,” Ford said, explaining why he had softened his stance.

“When you’re negotiating with someone, they call you and they hand over an olive branch, the worst thing I think I could do as premier of Ontario is ignore them and hang up the phone on them. I don’t operate that way — I believe when someone’s putting out an olive branch we sit back, we accept it graciously, by the way, thank them for that opportunity and let’s start moving.”

Trump also spoke after the agreement, suddenly heaping praise on Ford for his tough stance.

“There’s a very strong man in Canada who said he was going to put a surcharge or a tariff on electricity coming into our country,” Trump said. “He has called and said he’s not going to do that. It would have been a very bad thing if he had done that, but he said he’s not going to do that, and I respect that.”


Click to play video: 'Ontario keeps trade retaliation measures in place until ‘zero’ U.S. tariffs promised'


Ontario keeps trade retaliation measures in place until ‘zero’ U.S. tariffs promised


Ford stated that, although he had suspended the surcharge as a goodwill gesture in hopes of it being reciprocated, it remains an option moving forward.

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The Ontario government, in conjunction with Ottawa and other provinces, has said it will not drop its response to Trump’s tariffs until he no longer threatens them. Trump has been granting reprieves and carve-outs since he was sworn in as president in January after first vowing to impose them on all Canadian imports right away.

Ford has been trying for months to get the attention of Trump to dissuade him from imposing tariffs on Canada.

He made two visits to Washington D.C., during the recent election campaign to meet American politicians and secured a meeting with some White House staff, although not the president.

Ontario is also spending millions of dollars on an advertising campaign designed to remind Americans of Canada’s long-standing close relationship with the U.S.

Ford’s policies briefly caught Trump’s attention in December 2024 when the premier initially threatened to cut off energy exports to 1.5 million Americans living in border states. Trump, then president-elect, told a CNBC reporter on the floor of the New York Stock Exchange it was “fine” if Ford did that.

Since then, Ford has been making multiple appearances on U.S. media, pleading Ontario’s case and warning of its response to the American audience.

It was the threat this week to cut off energy that appears to have filtered into the White House — with Ford named by Trump’s press secretary during a televised briefing.

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Ford said he believed his U.S. media appearances had helped in an effort to keep Americans onside during the ongoing and bitter dispute.

“What I’m doing the American media for is to inform the American people,” he said.

Ontario also removed U.S. alcohol from the shelves of the LCBO as part of its broader tariff response. The pause in the energy surcharge, however, does not mean the U.S. alcohol boycott is over, the premier’s office said.


Click to play video: 'Trump says he’ll double steel, aluminum tariffs on Canada in response to electricity tax'


Trump says he’ll double steel, aluminum tariffs on Canada in response to electricity tax


— With files from Colin D’Mello and Uday Rana