Here’s how Canada’s data centre boom could hurt — or help — your wallet

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Photo by Heywood Yu/PostmediaThe artificial intelligence data centre buildout is becoming one of Canada’s biggest economic bets, with at least tens of billions of dollars scheduled to be spent.THIS CONTENT IS RESERVED FOR SUBSCRIBERS ONLYSubscribe now to read the latest news in your city and across Canada.Exclusive articles from Barbara Shecter, Joe O'Connor, Gabriel Friedman, and others.Daily content from Financial Times, the world's leading global business publication.Unlimited online access to read articles from Financial Post, National Post and 15 news sites across Canada with one account.National Post ePaper, an electronic replica of the print edition to view on any device, share and comment on.Daily puzzles, including the New York Times Crossword.SUBSCRIBE TO UNLOCK MORE ARTICLESSubscribe now to read the latest news in your city and across Canada.Exclusive articles from Barbara Shecter, Joe O'Connor, Gabriel Friedman and others.Daily content from Financial Times, the world's leading global business publication.Unlimited online access to read articles from Financial Post, National Post and 15 news sites across Canada with one account.National Post ePaper, an electronic replica of the print edition to view on any device, share and comment on.Daily puzzles, including the New York Times Crossword.REGISTER / SIGN IN TO UNLOCK MORE ARTICLESCreate an account or sign in to continue with your reading experience.Access articles from across Canada with one account.Share your thoughts and join the conversation in the comments.Enjoy additional articles per month.Get email updates from your favourite authors.THIS ARTICLE IS FREE TO READ REGISTER TO UNLOCK.Create an account or sign in to continue with your reading experience.Access articles from across Canada with one accountShare your thoughts and join the conversation in the commentsEnjoy additional articles per monthGet email updates from your favourite authorsSign In or Create an AccountSome say these facilities can also be a core pillar of national sovereignty, but Canadians are worried about the potential environmental and social impacts, with 64 per cent saying their provincial governments should limit the development of large data centres, according to an October survey by the Angus Reid Institute. Only 18 per cent want more. Nevertheless, Canada has 194 active data centres, 213 planned projects and about 14 under construction, according to a July paper by York University.This advertisement has not loaded yet, but your article continues below.Here’s how the AI data centre buildout could affect the economy and your pocketbook.Get the latest headlines, breaking news and columns.By signing up you consent to receive the above newsletter from Postmedia Network Inc.A welcome email is on its way. If you don't see it, please check your junk folder.The next issue of Top Stories will soon be in your inbox.We encountered an issue signing you up. Please try againHigher prices for consumersData centres optimized for AI are typically much larger than traditional facilities and require more land, energy, water and tech equipment.For example, Colossus 2, the world’s largest AI data centre being built by Elon Musk’s X.AI LLC, has 550,000 Nvidia Corp. chips, consumes 946 megawatts (MWs) of power — enough to power up to one million homes — and continues to grow.The global boom has led to a supply crunch of conventional chips used in consumer goods, leading to higher costs for computers, mobile phones and household appliances, something analysts expect to continue in 2027 and beyond.Apple Inc. recently hiked iPhone prices by US$100 and research firm Gartner Inc. said PC prices are likely to jump 17 per cent this year and smartphone prices by 13 per cent.“Some memory component prices have increased by 300 to 400 per cent, with retailers either passing along the higher costs or adjusting specifications to keep the same sticker price,” said Kevin Jia, co-founder and chief executive of Quoted Technology Corp., a Toronto-based company that builds custom computers. “Your dollar doesn’t go as far.”This advertisement has not loaded yet, but your article continues below.Electric circusThe federal government in September said data centres “must not shift electricity costs to Canadians (and) must not compromise grid reliability,” and facility owners or operators must pay for connecting and servicing their projects.Some provinces have released similar rules. For example, data centres of 75 MW and above in Alberta must generate their own power to get priority grid access.But the outsized power demands of such facilities will put pressure on Canada’s already-constrained energy infrastructure and contribute to rising prices, said Pierre-Olivier Pineau, a professor at business school HEC Montréal who studies electricity markets.For example, Meta Platforms Inc. is developing a natural gas source to power its $13-billion, one-gigawatt (GW) Sturgeon County, Alta., facility, which is expected to be operational by 2028. But because it will connect to the grid before its natural gas plant comes online, clean energy think tank Pembina Institute said it could add between $270 to $460 annually to Albertans’ electricity bills from 2027 to 2031.This advertisement has not loaded yet.This advertisement has not loaded yet, but your article continues below.“While Albertans could see a six per cent reduction on the transmission portion of their electricity bills as a result of Meta’s grid connection, the market impacts … will far outweigh the transmission savings,” it said in a report in August.In Saskatchewan, BCE Inc. is set to build a 900-MW power plant for its recently expanded 1.2-GW project, but has yet to provide a timeline on construction. Saskatchewan Power Corp., a Crown corporation and the province’s main electricity supplier, will provide 300 MW.“Since Saskatchewan doesn’t have a surplus of available power capacity, it will need to upgrade the system at a cost that will be borne by all consumers for that 300 MW,” Pineau said.The province has said the data centre will be the last one to use SaskPower.Overall, requiring large-scale data centres to find their own power source is necessary, but not enough to keep a lid on electricity price increases, said Werner Antweiler, a business professor at the University of British Columbia who researches electricity markets and energy economics.“The cost of supply is not simply the cost of building new generators, but also how the new connection impacts the overall grid use and prices in the system,” he said. “When a new grid connection is brought in when capacity is tight, this shifts up marginal prices in the system as peak events become more frequent.”This advertisement has not loaded yet, but your article continues below.He also said if high-cost generators are brought online instead of cheaper renewable energy, grid-connected and market-linked power sources can increase average wholesale market prices.Labour plusses and minusesData centre and computing infrastructure sector employment rose almost 23 per cent from June 2025 to June 2026, while total payroll employment grew 0.8 per cent, according to a report by job search site Indeed Canada Corp. using numbers from Statistics Canada.Data centre workers currently make up less than one per cent of the total employed workforce, but related job postings have jumped 68 per cent since the start of 2025, while total job listings grew seven per cent. As of August, data centre job postings were 36 per cent above pre-pandemic levels.Indeed said salaried sales positions in the data centre field command a 43 per cent premium over other sectors and IT infrastructure operations and support workers earn 25 per cent more.But some say large-scale data centres will only create a modest number of jobs once built, especially given their size and cost, because they are highly automated.This advertisement has not loaded yet, but your article continues below.For example, one Blackstone Inc.-backed facility costing 10 billion pounds in the United Kingdom is set to create 400 permanent full-time roles and around 1,200 construction jobs, according to a May report by the U.K. government.U.K.-based think tank Verdant, which has called for limiting data centre development, said in a September report that planned projects in the country will create jobs, but about 75 per cent less than industry advocates claim.“Headline job numbers need to be read carefully,” Simon Blanchette, a lecturer at McGill University in Montreal, said. “A few hundred longer-term and highly skilled jobs can be meaningful, particularly in a smaller community, but data centres are not factories employing thousands over their full life span.”He also said the main risk is that these projects draw from the same constrained labour pool the country needs for housing, grid upgrades and other major infrastructure.Environmental costsNearly 80 per cent of Canadians worry about data centres’ electricity use, water consumption and greenhouse gas emissions, according to a July 2026 Leger survey.This advertisement has not loaded yet.This advertisement has not loaded yet, but your article continues below.A 122-MW facility, the average capacity of a Canadian data centre, consumes around the same volume of electricity as 49,000 to 78,000 Canadian households, York University said. The International Energy Agency forecasts the largest facilities being built will consume 20 times more power than a typical AI data centre today that uses as much electricity as 100,000 households.The companies building Canada’s hyperscale data centres promise their facilities will minimize environmental burdens, pointing to the use of water-efficient cooling systems and noise-mitigation measures, but they will largely be powered by natural gas.Antweiler estimates that four GW of natural-gas-powered data centre capacity would annually produce around eight megatonnes of carbon emissions, with some variations depending on power plant efficiency and utilization.Pineau said Canada’s carbon price on industrial emissions could also financially impact Canadians.As for water usage, closed-loop and advanced cooling systems are a “mixed bag,” said Anne Pasek, a Canada research chair in media, culture and the environment and associate professor at Trent University in Peterborough, Ont., since they can reduce water consumption, but increase a facility’s total energy cost.This advertisement has not loaded yet, but your article continues below.She said advanced cooling also requires certain chemicals such as anti-corrosive agents, biocides and polyfluoroalkyl substances — also known as forever chemicals — that are used in place of evaporative water, raising questions around chemical storage, contamination and water processing.Pasek also said there are also regulatory holes since there aren’t many requirements for facilities to disclose performance beyond the initial permit application.“Some harms can be mitigated to some extent, but it ultimately comes down to trade-offs. The best we can do is harm reduction,” she said. “Voluntary standards don’t guarantee that outcome or facilitate a democratic deliberation on who bears the remaining harms.”We apologize, but this video has failed to load.This advertisement has not loaded yet.Notice for the Postmedia NetworkThis website uses cookies to personalize your content (including ads), and allows us to analyze our traffic. Read more about cookies here. By continuing to use our site, you agree to our Terms of Use and Privacy Policy.