This article draws upon observations and themes taken from the Canadian Ditchley Foundation conference held in Toronto from October 16-18, 2026. The Ditchley Foundation and Canadian Ditchley Foundation lead conferences aimed at building new common ground and addressing some of the world's most complex geopolitical concerns. The observations and commentary offered here reflect the writers' personal impressions of the discussion and should not be understood or interpreted as the official viewpoint of either the Ditchley Foundation, the Canadian Ditchley Foundation, or any of the conference participants.
 

A hinge moment

For generations, Canadian foreign and economic policy has rested on a comfortable bedrock: an international rules-based order anchored by the United States, predictable multilateral institutions, and the assumption that increased economic integration under the Bretton Woods institutions would naturally bend the arc of geopolitics toward greater stability, peace, and prosperity. The international strategic landscape facing Canada is now less certain. This reality necessitates a reassessment of the fundamental assumptions that have traditionally supported Canadian energy and critical infrastructure sectors.

The discussions at this year’s Canadian Ditchley Foundation conference highlighted that the transition toward a less predictable multipolar environment is—or should at least be treated as—a permanent or near-permanent change. We are now in a period characterized by a gradual reduction in the centralized provision of global public goods (free trade, freedom of navigation, national sovereignty, economic order, rules of global trade), alongside the emergence of competing models for global governance. For a resource-rich democratic middle power like Canada, this new, less predictable global environment introduces a complex set of new and challenging risks, but it also provides a framework to exercise greater strategic agency in shaping the country’s future and the future world order.

Forged in fire

It was particularly fitting that this year’s Canadian Ditchley conference began with a lecture given by Harvard Professor Ricardo Hausmann at Toronto’s beautiful Gardiner Museum—a museum dedicated to the ceramic arts—a craft where raw earth is shaped under intense heat and pressure into something resilient and enduring. After Dr. Hausmann’s talk, over the course of 48 hours, invited guests grappled with the forces that are reshaping our world to ask what kind of enduring new global architecture we can mould from them.

To maintain global competitiveness, Canada's energy and macroeconomic infrastructure strategies need a profound structural readjustment.

Historically, Canada’s entire economic apparatus was deeply and inextricably integrated with the economy of the United States. Across North America, physical infrastructure, supply chains, media markets, transportation networks—specifically high-voltage power transmission lines and oil and gas distribution networks—have generally run on a north-south axis, reflecting a history of proximity-based trade between close allies. Now, as global trade dynamics evolve into an era of protectionism and Canada's traditional partners reassess its global trade relationships, the assumption of perpetual, near-frictionless access to the American markets is no longer a viable foundation for long-term planning.

For the power sector industries which we serve, this likely means pivoting away from proximity-reliant sub-sectors toward higher-value sub-sectors such as professional engineering, advisory, and financial services, advanced manufacturing, digital services, and high-value critical mineral extraction and processing. Furthermore, navigating this transition will also require a significant hardening of domestic grid infrastructure to rely on domestically controlled assets, systematically reducing reliance on imported power and grid components, securing supply chain resilience, and aggressively developing domestic manufacturing capabilities.

Generation and the power-shoring imperative

The global energy transition requires the massive electrification of industrial processes currently reliant on fossil fuels. Canada possesses one of the cleanest electricity grids globally, heavily endowed with legacy hydroelectric resources, expanding wind capacity, and a robust nuclear sector. Rather than continuing to export raw electricity across the border at wholesale spot-market rates, there is now a strong strategic case for "power-shoring." This involves utilizing our clean grid to attract and incubate industries that require massive, zero-carbon energy inputs, such as hyperscale AI data centres, green metallurgy, and critical mineral processing. By powering these facilities domestically, Canada effectively exports its vast clean energy capabilities embedded within high-value, distance-resilient products.

Transmission, distribution, and the east-west corridor

Our ability to capitalize on this green energy endowment is currently held back by the physical architecture and regulatory fragmentation of the national transmission grid. Entrenched north-south integration presents a strategic vulnerability as U.S. trade policies become decreasingly predictable. Relying on American grids to balance provincial loads subjects the Canadian economy to external regulatory and tariff risks. To build resilience, there is a pressing need to decisively transition away from platform dependence on American grid assets by constructing a cohesive, high-capacity east-west transmission corridor. Realizing this opportunity requires a sustained, unified national focus on clearing the deeply entrenched domestic regulatory and transportation bottlenecks that have historically fractured the Canadian internal electricity market. The good news is that this project is already getting underway.

Hardening supply chains

The global transition toward industrial electrification and the exponential load growth from AI data centres has triggered a systemic crisis in the global supply chain for electrical equipment, specifically large power transformers. Lead times for these capital-intensive components have expanded dramatically, creating severe bottlenecks for grid modernization. Canada is well-positioned to capitalize on this global deficit by accelerating the expansion of its domestic manufacturing base for complex power equipment. Scaling these capabilities would ensure our critical infrastructure is not entirely dependent on congested and vulnerable overseas supply chains. We are already seeing significant capital deployment in this space; recent examples include Hitachi Energy’s $270-million expansion of its large power transformer facility in Varennes, Quebec, and its $479-million investment in a new transformer components factory in London, Ontario, alongside ongoing capacity scale-ups by Guelph-based Hammond Power Solutions. These investments highlight a growing domestic capacity to produce highly specialized, distance-resilient grid components.[1]

Zero-trust engineering standards and grid resilience

The modernization of national industrial capacity is also closely tied to the security of digital infrastructure. Public utilities, smart grids, transportation networks, and critical infrastructure of all forms rely on complex digital networks, all of which are exposed to cyber security threats and data vulnerabilities. In a fragmented world, reliance on external technology stacks for critical infrastructure presents material risk. Mitigating these risks requires a measured, defensive approach to sovereign technology, prioritizing rigorous audits of supply chain dependencies and, perhaps most importantly, the implementation of zero-trust engineering standards for all technology procurement.

Under standards such as the North American Electric Reliability Corporation Critical Infrastructure Protection framework, utilities are actively required to implement comprehensive supply chain cyber security risk management plans. Furthermore, domestic regulatory frameworks are hardening, with legislative developments like Bill C-8 seeking to compel designated operators in federally regulated industries to establish robust cyber security programs. Strategic investments in domestic artificial intelligence and cyber security capabilities will be necessary to help insulate power networks and operational data from external interference. By incubating these sovereign cyber capabilities, Canada not only shields its critical infrastructure but also cultivates a highly advanced, exportable digital services sector which our allies in other liberal democratic countries in Europe and Asia can rely upon.

For electric power sector industry participants, adapting to this new reality demands a comprehensive overhaul of traditional assumptions and operating models. It requires prioritizing manufacturing and export strategies that demonstrate resilience to the "tyranny of distance"—specifically pivoting toward high-value professional services, advanced manufactured electrical goods, digital grid intelligence, and critical mineral processing.

Takeaways for industry operators

For the Canadian electric power industry, surviving the transition to this new political geography requires abandoning the notion that electricity is merely a domestic utility or a raw commodity to be exported at a healthy mark-up to adjacent U.S. states. Instead, the power sector must now be viewed as a vital engine for complex and sophisticated industrial capabilities and high-value global exports. Achieving this vision demands a coordinated, national pivot. We must leverage our vast, clean generation capacity to "power-shore" advanced low-carbon manufacturing and critical mineral processing, while simultaneously building the east-west transmission corridors necessary to insulate our domestic markets from external regulatory volatility.

This physical hardening must be matched by an uncompromising commitment to digital sovereignty and zero-trust engineering, ensuring that the infrastructure underpinning our economy is made more secure from asymmetrical threats over time. Ultimately, navigating this global rupture requires Canada to actively exercise its strategic agency. By aligning our abundant energy resources with secure supply chains and robust cyber defences, we can transition from relying on historical proximity to acting as a self-reliant architect of the new global energy economy.