Cross-border electricity tariffs undermine power system efficiency, decarbonization and reliability in North America.

The United States and Canada share an interconnected electricity system where cross-border trade lowers costs, supports low-carbon generation and balances supply and demand during stress. Tariff disputes risk costlier or curtailed electricity imports, yet the system-wide consequences remain unclear. Here we show, using ten years of New York electricity-market data and power-system simulations, that tariffs on Canadian electricity reduce imports, raise prices, lower economic welfare and increase carbon emissions by replacing hydropower- and nuclear-rich imports with fossil-fuel generation. Tariffs above about 55% on Ontario imports, or about 90% when extended to Quebec, nearly eliminate affected imports under historical market conditions. Reduced access to Canadian power shrinks operating reserves, which provide spare capacity during unexpected shortages, increases reliance on oil-fired plants during summer peaks, and raises the risk of forced power cuts during severe winter disruptions. Open cross-border electricity trade therefore supports cost efficiency, decarbonization and grid resilience.