By Kapil Raval · September 2026 · 6 min read
This week, Ottawa announced a new accord. Twenty-three of the world’s biggest AI and cloud companies signed on to a set of “Responsible Data Centre Development Principles.” It sounds like progress. Read the fine print, and it isn’t.
The promise: new data centres in Canada will benefit local communities, protect consumers from power price hikes, and minimize water use.
Canada has something most countries don’t: clean, abundant power in places like Quebec and British Columbia, a stable political and legal system, deep AI research talent, and growing global demand for data centre capacity outside the US and China.
Billions of dollars are already flowing in. Meta is building a data centre complex near Edmonton. Microsoft, Amazon, and Google are each expanding. Cohere, Bell, and Telus are racing to build sovereign AI infrastructure at home.
Meta’s data centre campus in Sturgeon County, Alberta represents an investment of more than $13 billion. HIVE’s planned facility in Oakville represents another $3.5 billion. That is $16.5 billion in capital, in just two projects, already committed in Canada, right now.
Other countries want that same investment. The window will not stay open indefinitely.
So why does this week’s accord feel disappointing rather than decisive?
Because it has no teeth. There is no compliance mechanism. There is no penalty for a company that signs the pledge and later breaks it. The principles are voluntary, and the federal government has said as much.
Worse, the substance that actually matters to citizens — electricity pricing, environmental impact, land use — is not something Ottawa controls. That authority sits with the provinces and municipalities. So the accord becomes a set of good intentions, handed down to a patchwork of local governments to enforce, or not, on their own.
For a citizen watching a data centre rise in their community, “voluntary principles” does not answer the questions that matter: Will my power bill go up? Will this project actually benefit my town, or just the company building it? Who do I hold accountable if it doesn’t?
An announcement that raises these questions without answering them does not build trust. It hands more ammunition to the opposition already gathering in Mississauga, in Rocky View County, in communities from coast to coast.
Here is the deeper problem. Every province is inventing its own rules, on its own timeline, in response to its own local pressure.
Ontario is moving to charge data centres more for power. Alberta introduced a data centre levy. British Columbia is making data centres compete for power allocation. Reasonable responses, each one, but none of them coordinated with the others. A developer looking to build in Canada faces a different set of rules in every province, and a different fight in every town. Each community relitigates the same questions — water, noise, power, benefit-sharing — as if no other town in Canada has ever asked them before.
Consider the timing. Oakville enacted a one-year moratorium on new data centres on August 11, 2026. Its own $3.5 billion HIVE project is now sitting in that limbo. Two days later, Ontario launched consultations on its own Data Centre Playbook, explicitly designed to attract AI investment and position data centres as strategic infrastructure. One government body pumping the brakes, the province it sits inside pressing the gas, the same week. Capital does not wait patiently while governments sort out who is in charge. It moves to the next jurisdiction that offers certainty.
Underneath the coordination problem sits a capacity problem. Most town councils do not employ engineers who can assess the grid impact of a 300-megawatt interconnection, or hydrologists who can evaluate a facility’s draw on the local water table. Building that expertise, one town at a time, is not realistic. A shared national baseline would give small communities access to expertise they will never build on their own — which may explain why the Federation of Canadian Municipalities co-announced the framework alongside the AI Minister, rather than waiting to react to it. Municipalities want a shared standard badly. What they got still has no enforcement behind it.
Why does this keep happening? Energy, land use, and most environmental permitting are constitutional provincial jurisdiction, not federal. Ottawa cannot simply legislate a national standard the way it might with telecommunications. Any credible national approach has to bring the provinces to the table, not override them.
That is a hard problem. It is not, however, a reason to settle for another toothless accord.
South Korea offers a useful comparison — not as a template to copy directly, but as a demonstration of what focus can achieve. Korea builds nuclear power faster than most countries because it uses a small number of standardized reactor designs, built repeatedly by a single national utility, treated as a matter of industrial strategy rather than a one-off approval each time.
Canada’s federal structure does not allow for that kind of single-utility, single-design approach. Provinces will not hand over their energy authority, and they should not be expected to. But standardization does not require abandoning provincial control. It requires provinces agreeing to a shared baseline: one common permitting process, one shared timeline for approval decisions, one consistent set of criteria for what “community benefit” and “environmental protection” actually mean in practice.
This is a convening challenge as much as a policy challenge. It requires bringing every province and territory to the same table and building real consensus, not issuing a federal directive and hoping provinces comply.
Ottawa’s AI Minister, Evan Solomon, has the mandate to convene this conversation, and the Federation of Canadian Municipalities has already shown it is willing to be at the table. What is needed now is not another set of voluntary principles, but one standardized, enforceable approval process, agreed to by the provinces, with clear timelines and clear accountability.
Ottawa does not need new constitutional authority to make this happen. It has a tool it already uses elsewhere: funding conditions. Federal infrastructure grants and sovereign AI compute funding could be tied to a province’s adoption of the shared baseline — the same way federal health transfers have long carried conditions tied to national standards. Provinces would not be forced to cede jurisdiction. They would choose to align, because alignment comes with the money attached to Canada’s AI buildout.
This will not happen quickly, and it will not happen without hard negotiation. But the current path — a new toothless announcement every few months while each province and town fights its own version of the same battle — is not a strategy. It is a way of managing decline while calling it progress.
Canada does not have unlimited time to get this right. Global capital is mobile. Other countries are competing aggressively for the same investment. The advantage we hold today in talent, clean power, and stability will not last if we cannot translate it into projects that actually get built, on a timeline the rest of the world can plan around.
The question is not whether Canada can afford to move faster. It is whether we can afford not to.