A Snapshot Guide to Canada’s Renewable Energy Market

by | Jun 13, 2021 | Blog

 A geographical outline of Canada represented as a large solar PV panel.


  • Renewable energy is energy that is produced from natural sources (i.e. those that can be replenished in ways that keep up with or exceed the rate of consumption). There are several different forms of renewable energy. These include solar, wind, geothermal, hydropower, ocean resources, solid biomass, biogas and liquid biofuels.
  • Due to Canada’s diverse geography and huge landmass, it is one of the world’s leaders in the production and use of renewable energy. Canada is currently number seven in the renewable global rankings.
  • Canada is currently the second-largest producer of hydroelectricity in the world. In 2014, Canadian hydroelectric stations collectively generated a massive 378.8 terawatt-hours, which accounted for an incredible 59.3% of Canada’s total electricity generation.
  • Although the most prominent type of renewable energy production in Canada is hydroelectricity, bioenergy and wind are also significant contributors to Canada’s energy mix. However, solar photovoltaic power and wind power are experiencing the highest growth rates in the Canadian energy market


If you are a renewable energy novice, you may not understand what renewable energy is. In simple terms, renewable energy is power generated from natural sources that can be produced and consumed sustainably without running out. Several forms of renewable energy can derive directly or indirectly from the sun or heat generated within the earth. Some of the most prominent green energy sources include:

  • Solar
  • Wind
  • Geothermal
  • Hydropower and ocean resources
  • Solid biomass>
  • Biogas and liquid biofuels

Technically, biomass can only be considered a renewable resource if its rate of consumption does not exceed its rate of regeneration.

Nowadays, a wide range of energy-producing technologies and tools have been developed. Thanks to renewable innovation, we can now take advantage of these natural resources. Renewable energy now allows us to produce usable energy in the form of electricity, transportation fuels, industrial heat, and thermal energy for space and water conditioning.

Canada has a vast landmass and diverse geography, making it a fantastic place for an abundance of renewable resources. Today, Canada is one of the world’s frontrunners in the production and use of green energy. As a nation, it currently gets around 18.9% of its total primary energy supply from renewable energy, which places Canada at number seven in the world renewables rankings.

One of the most crucial forms of renewable energy production in Canada is hydroelectricity, as it accounts for most of the country’s renewable energy production. Bioenergy and wind are also significant contributors to Canada’s energy mix. However, solar photovoltaic power and wind power are experiencing the highest growth rates. So with this being said, let’s dig into each of Canada’s leading renewable energy sources.

Canadian Solar Energy

Around half of Canada’s residential electricity needs could be met by installing roof solar panels on residential buildings.

Solar energy is power generated from the sun in the form of light and radiated heat. It is possible to use the sun’s radiant energy to produce electricity and provide lighting and heating for buildings. Historically, solar energy was harnessed through passive solar technologies. This mainly involved the careful planning and positioning of buildings and various elements within them – such as overhangs, thermal masses, and of course, windows.

These innovative practices took advantage of the sun for lighting rooms and heating spaces. This also allowed for the use of electrical or mechanical equipment to be significantly reduced. The downside to early solar power was that it could only be harnessed during daylight hours (and in conditions where clouds, buildings or other obstacles did not block the sunlight).

In Canada today, there are two main active solar technologies that involve electrical or mechanical equipment. The first is solar collectors (or solar thermal panels), which are used to heat water or ventilation for use in buildings. The second is solar photovoltaic technology which utilizes solar cells to convert sunlight into electricity.

Due to Canada’s geographical range, the potential for solar energy varies across the country. In coastal areas, the prospects for solar power are lower due to the increased cloud coverage. However, in the central regions, the productivity of solar is much higher. With this being said, when compared to the world at large, the solar potential for most Canadian cities can be likened to that of many other major cities. For instance, around half of Canada’s residential electricity needs could be met by installing roof solar panels on residential buildings.

The use of solar energy has grown in recent years across Canada, but it remains relatively small in terms of market penetration. Since 2004, the installed capacity for solar thermal power in Canada has seen an annual compound growth rate of 13.8%. There was significant growth of installed capacity for solar photovoltaic power between 2008 and 2014, and in the latter year, it reached 1,843 megawatts of installed capacity

Canadian Wind Power

There are currently no offshore wind farms constructed in Canada, and the development of coastal wind farms is also limited.

Wind power is harnessed by converting the kinetic energy in the wind into useful forms of energy such as electricity and mechanical energy. People have been harnessing wind energy for centuries – using it to turn grist mills, water mills, and propel sailing vessels. Nowadays, we have wind turbines equipped with huge propellers. These wind turbines are erected in ‘wind farms’ located in strategic areas that have favourable wind patterns and are in close proximity to existing electrical grids.

It is only possible to capture wind energy when the wind speed is adequate to move the large turbine blades. On the flip side, if the winds are too overpowering, the turbines may be switched off as they could be damaged if operated.

There is significant potential for expanding wind-generated power in Canada as the territory is vast and has some excellent wind resources. Generally speaking, some of the premium wind areas are located along coastlines and offshore. There are currently no offshore wind farms built in Canada, and the coastal wind farm development options are limited due to the fact that most of Canada’s coastlines are in remote regions. This makes the high-quality inland areas across Canada a more attractive option for wind farms. Areas such as the Southern Prairies and the Gulf of St. Lawrence show great potential.

In recent years, the installed wind power capacity in Canada has expanded rapidly and is projected to continue flourishing at a fast pace. This surge in growth is due to the increased renewable energy interest from Canadian governmental initiatives and electricity producers. Since December 2014, Canada has erected over 5,130 wind turbines that operate on 225 wind farms for an overall installed capacity of 9,694 megawatts. For the sake of comparison, there were only 60 wind turbines and eight wind farms with 27 megawatts of overall capacity in 1998. Currently, the leading Canadian provinces in wind power capacity are Alberta, Ontario, and Quebec.

Canadian Hydroelectricity

Infographic of hydroelectric pant and wind farm

Canada is now the second-largest producer of hydroelectricity in the world.

Canada has many fast-flowing rivers, and the natural water flow of these rivers produces kinetic power that can be converted into energy. Humans have been using mechanical water power for centuries to help with milling, sawing, and irrigation. The Canadian rivers have not only been used to generate power, but also as transportation to move logs from forests to industrial centres.

Currently, in Canada, hydroelectricity is the most prominent form of usable energy produced from flowing water. To generate hydroelectricity, the water flow is directed towards turbine blades, making them spin, which then causes an inter-connected electrical generator to spin in response, consequently harnessing power.

The amount of energy that can be extracted from flowing water depends on the volume and velocity of the water. Generally, hydroelectric stations are built on a sharp incline or waterfall to make the most of the speed achieved by the rapids as a result of gravity. Dams are also built at some locations to support water flow management and electricity production.

Hydroelectric stations have been built in Canada, where the geography and hydrography are favourable. These developments are most prominent in Quebec. The other provinces in Canada that generate large amounts of hydroelectricity include British Columbia, Ontario, Newfoundland and Labrador, and Manitoba.

Canada has several fast-flowing rivers which come from its mountainous areas toward its three bordering oceans. As of 2014, there are 542 hydroelectric stations with 78,359 megawatts of installed capacity in Canada. These stations consist of 379 small hydroelectric facilities (facilities with a nameplate capacity of 50 megawatts or less). All together, they embody 3.6 gigawatts, which is around 4.6% of Canada’s total installed capacity.

In 2014, Canadian hydroelectric stations collectively generated 378.8 terawatt-hours. This accounted for a massive 59.3% of Canada’s total electricity generation. Not surprisingly, Canada is now the second-largest producer of hydroelectricity in the world.

Canadian Bioenergy

Canada has many farms, and it is now possible to create fuel from agricultural crops.

This is perhaps a renewable energy source that causes the most confusion for those new to green energy. Bioenergy consists of different forms of usable energy obtained from solid, liquid, or gaseous biological materials, which have stored sunlight in the form of chemical energy. Organic materials which have been transformed over an extensive period by geological processes (such as petroleum and coal) are excluded from the biomass definition – since these resources are fossil fuels.

With the proper equipment and technology, several types of biomass can be used to produce energy. The most frequent biomass material is wood. This is either roundwood or wood waste derived from industrial activities. The timber and wood waste is combusted to generate heat which is then used for space and water heating, industrial purposes, and to produce steam for electricity generation.

It is also possible to generate methane from solid landfill waste, sewage, manure, agricultural waste, and other biomass materials through anaerobic digestion. Anaerobic digestion is the process by which the biomass is broken down by microorganisms to produce biofertilizer and biogas. This process happens in the absence of oxygen and is completed using an oxygen-free tank called an anaerobic digester.

Canada has many farms, and it is possible to create fuel from agricultural crops. Sugars can be extracted from crops and then run through a distillation process to produce alcohol. This alcohol can then be used as fuel for transportation. There are now many other technologies available designed to take advantage of the different biomass feedstocks, and many new options are being developed.

With Canada’s massive landmass and active forest and agricultural industries, the country has access to extensive and varied biomass resources which can be utilized for energy production. Bioenergy is currently Canada’s second most prominent form of renewable energy.

Interestingly, bioenergy has also played an instrumental role in Canadian history. For centuries, people have been using wood to provide energy for cooking, heating space and water. Wood in Canadian homes is still prominent, with 4.6% of households using it as their primary or secondary source for space heating. There are over 100 petajoules of energy from wood being consumed in the residential sector per year. This represents more than 7% of residential energy consumption.

The most significant type of biomass in Canada is industrial wood waste. It mostly comes from the waste generated from paper and pulp production. This biomass is used to generate steam and electricity. There are more than 400 petajoules of bioenergy used in the industrial sector every year. The paper and pulp industry is the largest industrial user of bioenergy in Canada and accounts for most of the energy consumed in this sector.

As of the end of 2014, Canada has a total installed capacity of 2,043 megawatts from 70 bioenergy power plants. The majority of this capacity was developed around the use of landfill gas, spent pulping liquor, and wood biomass. These three biomass sources generated 8.7 gigawatt-hours of electricity in 2014. The majority of this biomass-fired capacity was located in provinces with significant forestry activities such as Alberta and New Brunswick, British Columbia, Ontario, and Quebec.

The fuels from renewable sources are a growing form of bioenergy in Canada. For example, in 2013, Canada was accountable for 2% of the world’s biofuel productions, which ranked the nation the 5th highest in the world. The two main biofuels produced in Canada are biodiesel (a diesel substitute) and ethanol (a gasoline substitute). Vegetable oils, non-edible waste greases, and animal fats are the primary feedstocks for biodiesel. In the case of ethanol, resources such as corn, wheat, and barley constitute the primary agricultural feedstocks. The Natural Resources Canada (NRCan) program estimates that in 2013, Canada produced 124 million litres of biodiesel and 1.7 billion litres of ethanol.

Canadian Geothermal Energy

The most state-of-the-art geothermal power project in Canada is called The South Meager project, which is based in British Columbia.

Geothermal energy makes use of the heat stored beneath the surface of the earth or the absorbed heat in the oceans and atmosphere to produce energy. To be able to utilize heat stored below the earth’s surface, geothermal energy is captured from naturally occurring underground steam traps that can be applied to generate electricity. With regards to absorbing heat from the ocean and atmosphere, heating and cooling can be attained by taking advantage of the temperature disparities between the air outside and groundwater below.

British Columbia, Northwest Territories, Yukon, and Alberta have geothermal resources at the highest temperatures – not to mention some hot springs. Heat and power generation prospects are being considered in prototype projects that are currently underway. The most state-of-the-art geothermal power development in Canada is called The South Meager project, which is based in British Columbia.

In 2010, Canada had over 95,000 ground-source heat pumps, which represented about 1,045 megawatts of thermal energy (MWth) of installed capacity. It produced an annual equivalent of roughly 1,420 gigawatt-hours.

Canadian Ocean Energy

Canada is only landlocked along its southern border, so much of the country is surrounded by oceans.

The ocean is a considerable energy source, and when approached correctly, it can be harnessed responsibly to generate different forms of energy. Technologies have been developed to transform the energy produced by oceanic waves and tides into electricity (and other potentially useful forms of energy). Unfortunately, there are a number of technical and economic barriers, as well as some negative environmental impacts. As a result, ocean energy is not currently a widespread initiative.

Canada is only landlocked along its southern border, so much of the country is surrounded by oceans. This means it has favourable access to the sea and its impressive energy potential. There is currently a Canadian tidal power plant in Nova Scotia which has a generating capacity of 20 megawatts of electricity. In British Columbia and Nova Scotia, tidal technology launch projects are currently being deployed.

Bay of Fundy (Nova Scotia) is planned to have a 13 megawatt tidal current capacity over the next few years. It has a vertical tidal range that can exceed 16 metres, which is nothing short of incredible. The bay offers the highest tides in the world and is a promising site for the future advancement of renewable resources in Canada.

The Takeaway

As we have learned, due to Canada’s large landmass and diversified geography, it is rich with clean resources that can be used to produce renewable power. Although there are many different options available, solar energy is one of the fastest-growing sources of energy in Canada (and the world). Apart from solar energy being a fantastic resource for responsible and renewable energy, it has also become incredibly efficient and economically viable. Thanks to solar energy investment, ongoing innovations are helping to make solar power a frontrunner in the Canadian renewable energy market.


What percentage of Canadian energy comes from renewables?

As of 2018, 16.3% of Canada’s national energy supply comes from renewable power sources. At this time, other OECD member states typically got 10.5% of their energy supply from sustainable sources, while the world average was approximately 13%. This makes Canada one of the leaders in renewable energy production.


How to invest in Canadian renewables: Which methods are easiest?

There are many different opportunities to invest in renewable energy. One direct way to get involved is to invest in clean energy projects (although these are not always available to retail investors). In addition to this, you can buy shares in green energy companies or choose to invest in renewable exchange-traded funds (ETFs).


When will non-renewables run out?

Coal and natural gas are projected to last until 2060 if we continue to consume these fossil fuels at the current rate without discovering any additional reserves. The consumption of natural gas grew significantly in 2018, increasing by 4.6%. China alone was responsible for over a third of this growth. On a wider scale, construction and industry sectors were responsible for 80% of the rise in global demand.


What is the biggest renewable energy source in Canada?

Due to the large amounts of moving water in Canada, hydropower is the most significant renewable energy source in the country. It provides 59.3% of national electricity generation and makes Canada the second-largest producer of hydroelectricity in the world. Wind energy is the second most prevalent renewable energy source in Canada.


Which country uses the most renewable energy?

Germany currently uses the most renewable energy. Their renewable use is high due to substantial investments made as part of efforts by the German government to meet European Union renewable energy and climate action goals. Germany has been working hard to decrease its coal use. During the first half of 2019, the country used more renewable sources of energy to generate electricity than coal and nuclear power combined. This was a monumental first-time achievement for Germany, and hopefully we’ll be seeing many more energy-themed breakthroughs around the globe.