Canada’s Electrical Industry Faces a Shifting Economic Landscape: Reflections from EFC’s Forecast Webinar

November 28, 2025

By Electro-Federation Canada

Canada’s electrical industry is navigating a period of significant change shaped by global uncertainty, evolving trade dynamics, and accelerating investment needs at home. During Electro-Federation Canada’s (EFC) Economic Forecast Webinar in September, two leading economists outlined trends that continue to influence the industry as businesses look toward 2026.

The webinar featured Maureen Farrow, President of Economap Inc., and Donald R. Leavens, Ph.D., Senior Vice President and Chief Economist at the National Electrical Manufacturers Association (NEMA). Although delivered earlier in the fall, their insights have become even more relevant with the release of new economic data and the federal government’s 2025 Budget.

Farrow described the global economy as entering “a new era of geopolitics and geoeconomics,” shaped by fractured trade relationships, inflationary pressures, and ongoing adjustments in global supply chains. She noted that weakening trade flows, tariff uncertainty, and affordability challenges are weighing on Canada’s growth, yet the country’s strengths in natural resources and infrastructure investment continue to provide resilience.

Since September, economic projections have reinforced this perspective. The Bank of Canada expects modest GDP growth through 2026, helped by easing inflation but constrained by slow exports and weak investment. At the same time, Electricity Canada reports that national power demand could more than double over the next 25 years, underscoring the scale of investment required in generation, transmission, and grid modernization. Demand of this magnitude will directly affect manufacturers, distributors, system planners, and utilities.

Leavens provided an industry-focused lens based on conditions in the United States electrical and industrial markets. His observations about rapid growth in data centre construction reflected U.S. activity, not Canadian market performance. However, the same forces he identified are starting to influence demand patterns in Canada, particularly the broader shift toward digital infrastructure.

Growth in artificial intelligence infrastructure, cloud services, and digital connectivity is reshaping power demand. It is also accelerating the need for investment in high-capacity electrical equipment. While broader manufacturing construction has cooled after several strong years, Leavens noted there are ongoing opportunities in reshoring initiatives, public infrastructure, and grid modernization projects.

To support Canada’s own digital and computing needs, the Government of Canada recently released the Canadian Sovereign AI Compute Strategy. This strategy confirms that domestic compute capacity and AI-specific data centre development are expected to expand in the years ahead, increasing the demand for reliable power availability, large-scale electrical infrastructure, and advanced grid connections.

Both economists emphasized that volatility has become a defining feature of the economic landscape. For electrical industry stakeholders, success will depend on adaptability and alignment with high-growth areas such as digital infrastructure, energy transition projects, and electrification initiatives.

The release of the federal government’s 2025 Budget adds important context to these trends. Budget 2025 introduces a Climate Competitiveness Strategy and outlines major infrastructure and clean-energy investment measures, including support for electricity system expansion, updated investment tax credits, and new approaches to streamlining major project approvals. These initiatives reinforce the need for accelerated private sector participation in energy, manufacturing, and technology development. They also reflect themes highlighted in EFC’s forecast, particularly the importance of improving productivity, strengthening supply chains, and preparing the grid for long-term load growth.

EFC’s Economic Forecast Webinar, supported in part by ABB, underscored the value of clear, evidence-based insight during a time of rapid transformation. As Canada’s electrical industry navigates continued uncertainty, the ability to translate these perspectives into strategy will be essential. The industry faces challenges, but it also stands at the center of some of the most significant economic and energy shifts now underway.

EFC | Electro Federation Canada