The federal government has announced its framework to guide data centre development in Canada, which has been signed by the world’s largest AI companies.
Amazon, Anthropic, Google, OpenAI, Meta, Microsoft and more all signed onto the framework, which was announced by AI Minister Evan Solomon on Thursday.
Solomon said the guidelines are not a new approval process, nor do they trump the approval processes from lower levels of government.
The five principles outlined in the framework are:
- Data centres must create lasting local benefits;
- Data centres must not shift electricity costs to Canadians;
- Data centres must minimize water use and environmental impacts;
- Data centres must be transparent about local impacts;
- Data centres must bring strategic value to Canada.
However, the framework is non-binding. It also offers no clear commitment on what kind of energy will power new data centres. For data centres not to pass the cost of electricity onto consumers, companies will need to either somehow pay to offset the increase in electricity costs (beyond just their power bills) or bring their own electricity.
Bringing their own electricity, in most Canadian cases to date, has meant gas-fired power generation.
Alberta and Ontario — the two provinces that are seeing the largest number of proposals for new data centres — both incentivize the use of natural gas to power data centres, said Stephen Legault, senior manager of the Alberta energy transition for Environmental Defence.
Legault welcomed the framework as a starting point, but urged governments to adopt rules that encourage data centre facilities to run on renewable energy.
The Alberta government has gone in the opposite direction. Its present policy discourages the use of renewables to power data centres and the province is contemplating a policy that would require large-load projects to rely on gas-powered generation. Legault says the 30 proposed data centres in Alberta could double the province’s electricity demand (which Canada’s National Observer has reported could lead to a tripling of electricity prices) and add at least 24 megatonnes of carbon dioxide emissions. Without binding regulations that encourage renewable energy, Legault says costs and emissions will rise.
“Voluntary principles alone will not slow this race to build,” he said in a statement.
Kari Hyde, director of the customer energy solutions program at the clean energy think tank the Pembina Institute, agrees that the federal guidelines set the right tone, but worries differences in provincial oversight will stand in the way of keeping costs and emissions low.
“If done right, smart and responsible, data centre development can support a cleaner, more resilient and more affordable grid. Done poorly, it risks locking in higher emissions and shifting electricity costs onto households and businesses,” Hyde said in a statement Thursday.
The framework comes as provinces and municipalities across Canada are grappling with the rise of data centre proposals. The Town of Oakville was the first to formally enact a freeze on data centre development, with Mississauga holding a final vote on its proposed moratorium this month.
Several of the signatory corporations have projects in other jurisdictions that have generated emissions complaints. Facilities operated by Meta, Amazon, Microsoft and OpenAI have been the subject of complaints about air pollution in the United States.
