Why Alberta and Montana are in a charged argument over electricity

When U.S. President Donald Trump’s top trade representative outlined conditions Canada would need to meet with a mandatory review of the Canada-U.S.-Mexico Agreement (CUSMA) looming, familiar issues like dairy supply management made the list.

Less familiar was a pointed reference to Alberta’s electricity system, with U.S. Trade Representative Jamieson Greer telling Congress that Alberta must revisit its “unfair treatment of electrical power distribution providers in Montana.”

In the view of representatives of Big Sky Country, Alberta’s rules sometimes block Montana electricity from being sold into Alberta, which they say hurts their power producers and discourages cross-border transmission investment. Alberta, meanwhile, says it isn’t treating Montana any differently than it does its Canadian neighbours.

Last year, the Office of the U.S. Trade Representative listed Alberta's non-profit electrical grid operator, the Alberta Electricity System Operator, or AESO, as a trade irritant.

“At the federal level, it’s affecting, possibly, the trade agreements, which is a big deal,” Daniel Zolnikov, a Republican state senator from Montana, told CBC News.

Zolnikov, who is chair of a Montana legislative committee studying technology and energy, said uncertainty around how transmission lines between Alberta and Montana are used is deterring investment in new infrastructure.

“To us, you’re a good neighbour, and this is not a healthy issue we’re dealing with right now … to say, we’ll fix it in the future is not an answer, right?” he said.

In an email to CBC News, a spokesperson for Steve Daines, a Republican senator for Montana, wrote that Daines “believes it’s 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.”

“He hopes a solution can be found to the situation,” Gabby Wiggins wrote in an email.

For his part, Alberta Utilities Minister Nathan Neudorf has disputed Montana’s claims.

“There have been allegations that we treat Montana differently than other Canadian jurisdictions. We do not. We treat them all the same,” Neudorf told CBC Radio’s Calgary Eyeopener on Thursday.

Alberta’s system has changed dramatically in recent years, with coal power fully phased out in 2024, along with a growing role of renewable generation in the market. 

The dispute between Alberta and Montana is tied to the practical challenges of running a modern electricity grid, said Ian Nieboer, managing director and head of energy transition research with Enverus Intelligence Research.

“Functionally, Alberta is an energy island,” Nieboer told the Calgary Eyeopener last month.