Hydropower is Canada's strategic advantage in a volatile energy world, and it is essential to the electricity buildout ahead. Here is why, and why the rules governing major projects must support responsible delivery.

By Lorena Patterson, President and CEO of WaterPower Canada, and Eddie Rich, CEO of the International Hydropower Association

Energy security is national security. Rising geopolitical tension, supply chain disruption, and climate-driven shocks are reshaping global energy systems. Countries with stable and diversified electricity systems are better positioned to protect their economies and their citizens. Canadians are already feeling the effects of volatility through rising energy costs, and the pressure on our electricity system is only intensifying. Demand for power could double by 2050 as transportation, industry, and buildings electrify, and the federal government has committed to expanding our national grid capacity to meet it.

That buildout will be one of the largest infrastructure undertakings in Canada's history. It cannot happen without hydropower. Hydropower is not simply part of Canada's energy mix. It is one of our most important strategic advantages.

The advantage we already have

Hydropower already plays a central role in Canada's electricity system. It provides the majority of Canada's renewable electricity and contributes significantly to grid diversity and price stability. Its importance becomes even clearer in a volatile global environment.

When Canada relies on fossil fuels for heating or transport, our cost of living is influenced by global markets shaped by events far beyond our borders. Hydropower operates differently. It relies on domestic water resources rather than fuel inputs, allowing it to provide a measure of price stability when global energy markets become turbulent. Once built, hydropower facilities continue producing electricity for decades, often for generations. Many Canadian facilities have been operating for 80 to 100 years or more and continue to deliver reliable electricity today. That long-term performance creates a stable foundation for the broader electricity system and reduces exposure to short-term price shocks.

Expanding electrification through a hydro-backed grid also keeps more energy spending within Canada's economy. It supports domestic industries, reduces reliance on imported fuels, and strengthens national resilience in an increasingly uncertain world.  

The backbone of the buildout

Canada's electricity system is evolving rapidly. Wind and solar are expanding and will continue to play an important role. But, with this expansion, the grid will need more than new generation. It will need flexibility, storage, and dispatchable power that can balance sudden variations in supply and demand. Hydropower provides all three, storing and dispatching energy when it is needed most and moderating overall system costs over time.

The world is racing to build what Canada already has

Canada is not alone in recognising this. Countries around the world are investing aggressively in electricity systems that support electrification, industrial competitiveness, and economic resilience, and hydropower is at the centre of that effort. It remains the world's largest source of renewable electricity, supplying roughly 14 per cent of global power and supporting grid flexibility in more than 150 countries.

The momentum is accelerating. Global hydropower capacity grew by 28 GW in 2025, including a record 11.7 GW of pumped storage, while global generation rebounded sharply from drought-affected lows the year before. Annual pumped storage additions have nearly doubled in the past two years as grids everywhere look for ways to firm up growing wind and solar fleets, and the global development pipeline now exceeds 1,000 GW of projects. Nations from China to Tanzania to Bhutan are building the kind of water-powered foundation that Canada has enjoyed for a century.

That is the strategic picture: while others race to construct this advantage, Canada's task is to protect and renew the one it already has.

Hydropower is also a driver of economic participation and partnership. Modern hydropower development increasingly includes equity ownership and long-term collaboration with Indigenous communities, creating shared economic opportunities and supporting regional development.

Responsible project delivery needs the right rules

Everywhere hydropower is growing, one lesson holds: the countries making progress are the ones whose governments have paired strong environmental and social standards with clear, timely approval processes. Permitting reform and long-term financing are now recognised worldwide as the difference between hydropower pipelines that get built and ones that stall.

Canada is no exception, and its water advantage cannot be taken for granted. Much of our infrastructure is aging and requires ongoing investment. Regulatory complexity and fragmented approval processes continue to slow the development and modernisation of major projects, and financing approaches do not always reflect the long-term value of assets designed to operate over generations.

If Canada is serious about the electricity buildout, the rules governing major projects must support responsible delivery. That means:  

• Modernising regulatory frameworks to reduce unnecessary delays while maintaining strong environmental standards;  
• Ensuring all permits are included in a "one project, one review" approach, providing  certainty and accelerated timelines without cutting corners; and
• Recognising water infrastructure as strategic national capital, with financing tools that match the multi-generational value these assets deliver.

Responsible delivery is not a trade-off between speed and standards. The Hydropower Sustainability Standard, developed through a multi-stakeholder process and managed by the Hydropower Sustainability Alliance, offers a voluntary certification framework designed to ensure future projects meet the most rigorous environmental, social and governance standards, including protecting biodiversity and engaging meaningfully with Indigenous communities are precisely the projects that endure for a century.

The opportunity is clear

Canada has a structural advantage that many countries are working to build. Hydropower provides reliability, flexibility, and long-term stability at a time when global energy systems are becoming more uncertain.

By treating hydropower as strategic national infrastructure, investing in its future, and ensuring the rules governing major projects enable responsible delivery, Canada can strengthen its energy security, power the buildout ahead, and build a more resilient electricity system for generations to come.