Cross-Border Electricity Trade and the Future of the Grid in Northeastern North America

Shen Wang, Jack Morris, Grant Lee, Joshua Hodge, and John Parsons

September 2026

This report examines the future 2050 electric grid across northeastern North America, including New England, New York, Ontario, Québec, and the Atlantic provinces. We evaluate the benefits of two forms of regional cooperation: enabling two-way cross-border electricity trade and expanding interregional transmission capacity. Using the GenX capacity expansion and dispatch model, we simulate long-term investment and operational outcomes under alternative trade, transmission, load growth, carbon policy, and nuclear deployment assumptions.

The results show that the 2050 grid will be fundamentally different from today’s system, with substantially higher electricity demand, retirement of carbon-intensive fossil generation, and large-scale investment in wind, solar, storage, hydro, and clean firm resources. Because wind resource quality varies significantly across the region, interregional coordination can lower system costs by shifting investment toward high-quality renewable regions, particularly Qu´ebec and the Atlantic provinces. One-way trade and existing transmission constraints limit this efficient allocation and require greater local investment in lower quality resources and flexibility assets.

Transmission expansion enables more efficient resource allocation, while two-way trade unlocks Québec’s hydro flexibility by allowing surplus renewable generation from U.S. regions to be absorbed and re-dispatched during scarcity periods. Combining two-way trade and expanded transmission reduces annual system costs by nearly $1.2 billion, or approximately 4%, while improving reliability and reducing renewable curtailment. These findings highlight the value of coordinated cross-border planning, bidirectional trade arrangements, and targeted transmission expansion for achieving an affordable, reliable, and low-carbon power system in northeastern North America.

Keywords: Power trade; transmission expansion; capacity expansion planning; power system decarbonization; energy policy; renewable integration; hydro flexibility

JEL Codes: Q40, Q42, Q48, L94