Building Canada's Digital Backbone: Five Key Strategic Takeaways From Gowling WLG's Montreal Data Centre Roundtable

As digital transformation accelerates for businesses, individuals and governments, the right infrastructure is becoming critical to support the technology on which the world relies. Data centres play a key role in this rapid growth, by offering the physical infrastructure needed to support every cloud service provider, artificial intelligence developer and data processor.

With these recent developments in mind, on January 20, 2026, Gowling WLG proudly inaugurated its new Canadian Data Centre team by hosting a compelling "Data Centre Roundtable" at its Montreal office. The event, themed "Dual Imperative: scaling AI and data centres," curated conversations which brought together various industry perspectives, ranging from government officials and utilities to leaders in the AI and data centre space.

The roundtable focused on Québec and Canada's path in developing and investing in digital infrastructure, against a backdrop of widespread AI adoption.

• The first panel, moderated by Gowling WLG partner Naim Alexandre Antaki, zoomed in on public policy and industry perspectives, where exchanges were heard between Gilles Bélanger (Québec Minister of Cybersecurity and Digital Affairs), Dominique Deschênes (Assistant Deputy Minister for Energy, Ministry of Economy, Innovation and Energy), Caroline De Vit (Hydro-Québec) and Catherine Saine (LawZero).
• The second panel, moderated by Gowling WLG partner Laura Gheorghiu, took a deeper dive into data centre development, finance and access to capital, with a discussion between key players in the industry, namely Simon Hamelin-Choquette (WhiteFiber / Enovum Data Centers), Marc Mondesir (Equinix), and Maxime Guevin (Vantage Data Centers).

For those who missed it, here are five main takeaways from the roundtable. Readers should note that Gowling WLG roundtables operate under the Chatham House Rule.¹ The observations and commentary here reflect the authors' personal impressions of the discussion and should not be understood as the official viewpoint of Gowling WLG nor of any of the roundtable participants.

1. Clean energy gets likes

While Canada stands out for its clean, affordable and reliable power grid, recent carbon neutral and clean energy trends have led to increases in demand, often faster than energy production. In practice, the system is evolving to a strategically selective approach as to the number of megawatts allocated for each project. Accordingly, many participants have observed that such limits to power are turning energy into a competitive advantage for many businesses, especially for the data centre industry.

Before introducing a new project, special care is required to navigate Canada's regulatory landscape, where each province has its own advantages and disadvantages. For example, in Québec, Law 24 was adopted last June 2025 to modernize the provincial energy sector framework.² The government retains its power to decide on the allocation of energy blocks of 5 MW or more. In Alberta, new regulations are reshaping the energy supply system for data centres.³ These regulatory changes highlight the recent traction gained by data centres and underscore the importance of tailored and specialized guidance.

Across Canada, recent government statements contain encouraging recognition of the value of these investments in cloud computing, logistics and construction of massive data centre infrastructure for stimulating economic activity.⁴ This position could eventually lead energy generators and distributors to allocate more energy to the sector to compete with other jurisdictions.

Government officials, regulators and utilities are also promoting an "open door" policy, whereby industry participants are encouraged to pitch new projects and discuss opportunities. As part of this collaborative approach, project developers should be ready to share information to enable governments, regulators and utilities to understand the project and its implications for the electricity grid and economic development.

Although the process may at times resemble a due diligence process or even a sales pitch, developers are expected to participate fully and transparently with regulators, to ease the process and unlock megawatts more quickly. For example, this process may require disclosing financial information, advocating for the project's social and economic benefits and emphasizing energy efficiency measures that can be deployed to ease pressure on the grid.

Data centres can play a unique role in demand response through redundancy and heat recovery. For example, capturing residual heat generated by data centre equipment could recycle that heat towards nearby residential or commercial communities, alleviating energy demand in the winter. Considering the limited energy availability for new projects, these benefits should always be emphasized when advocating for a new project, as governments and utilities will highly value any contributions to the grid's efficiency.

2. Data sovereignty is trending, but what that means is changing

With current geopolitical uncertainty, data centre clients are turning to "data sovereignty" for reassurance in stability and security. One speaker suggested that the main issues around sovereignty can be understood by breaking it down into two practical applications: cybersecurity and sensitive data.

First, the speaker described cybersecurity considerations as protecting Canadian data from the "kill switch." As digital applications are concentrated in the hands of a few entities, clients are voicing concerns about who can access this data. In parallel, legislation outside Canada is evolving towards increased government scrutiny, raising national security issues for data centre clients and even individuals. In addition, as servers are becoming more specialized and expensive, clients expect heightened security as part of their data storage needs.

Second, as data is also becoming an increasingly valuable asset, developers should consider rising awareness for privacy, especially when it comes to sensitive personal information such as medical records. Although storing sensitive data implies additional costs, governments remain wary of storing this type of data in a foreign jurisdiction, prioritizing local solutions instead.

It is worth noting that Canada's data privacy scheme is generally aligned with other jurisdictions, easing the regulatory burden on any business manipulating data. As well, regulators are always looking for a diverse offering of new types of projects as part of their strategic selection, so sensitive data handling capabilities—such as offering a dedicated isolated cluster for sensitive workloads—can represent a strategic and economic advantage.

While these considerations continue to shape what is meant by data sovereignty, roundtable participants agreed that the meaning of "sovereignty" is also evolving. As one speaker put it, instead of limiting the focus to local infrastructure, clients are now looking for a brand they can trust. In other words, today's data sovereignty should be understood as leveraging local expertise, supply chains and business partners. For data centre developers and operators, that trust can be built through a steady supply chain, local expertise and reliable business partners.

3. Life is a highway: The indirect benefits of data centres

A few years ago, data centres may have been conceived as infrastructure limited to cryptocurrency applications. Today, this conception is no longer accurate. Data centres are widely recognized as critical infrastructure, housing the servers used by millions of Canadians every day. Although AI and data are often thought of as intangible products or in the "cloud," these centres represent real, physical infrastructure required to access and support the wider digital economy.

A helpful way to frame the indirect benefits of data centres is the "highway analogy." While a highway itself doesn't employ a massive day-to-day workforce, its existence is a vital catalyst for broader employment, logistics, and regional economic development. Although a data centre's workforce is often built around cooling specialists and technicians, the real benefits hide behind data which travels through these centres every day. These indirect benefits for businesses and society are increasingly recognized by governments in project approvals and energy allocations.

For instance, data centre infrastructure serves as the foundational layer in a tech stack composed of service, applications and cloud storage providers. In addition, local data centres can be crucial for reducing latency of data travelling from point A to point B, such as in high-speed computing. For businesses, serious productivity gains are to be made from adopting technological and AI tools.

Lastly, every investment in the industry can help attract and retain the leading talent in tech fields, which rely on high-quality infrastructure. Fundamental research in university centres also benefits from access to powerful computing resources.

Overall, data centres' value should be considered under the multiplied effects of AI capabilities, interconnection, and academic and enterprise enablement, leading to much more significant productivity gains than strictly evaluating on‑site jobs per megawatt.

4. AI adoption Is becoming an essential requirement for productivity

One competitive advantage that was discussed was Canada's long and deep history of basic research into AI. In fact, Canada's AI ecosystem is well grounded in two strengths: being pioneers in building AI and fostering a culture of responsible AI.

Data centres stand to fill the gap where Canada can be expected to do more, namely in increasing AI computing capabilities and offering the right infrastructure to house the technology.

One speaker underscored that dynamics in tech have changed and hiring the best talent is no longer just about offering a competitive salary. Instead, people want to secure access to powerful computing infrastructure to exercise and enhance their skills. Local data centres are an important part of the equation, offering low-latency interconnectedness and high-performance computing.

In other words, every investment in the industry can help to foster the technological ecosystem which gravitates around these centres. As AI developments are unfolding at an increasingly rapid pace, data centres play a critical role as the supporting infrastructure to deploy these new technologies in a secure, sovereign and resilient environment.

5. Brand "Canada": Clean energy, stability and reliability as competitive advantages

Québec has always positioned itself as attractive for its clean and comparatively cheap energy. One speaker maintained that the province could also capitalize on its strategic geographical location, near New York City and Toronto, to increase performance and reduce latency. In addition, a historically strong expertise in AI, as well as geopolitical stability, characterize Québec and Canada to a larger extent.

However, one concern that was shared was the application of Québec property taxes to a data centre's equipment as part of the land valuation. The speaker raising that concern cautioned that tax authorities should carefully reflect on the impact of this measure on investors and developers, as it sharply contrasts with generous of tax amortization rules that allow developers to deduct the cost of servers. In other provinces like Alberta, specific levies were enacted to push data centres towards operating "behind the meter," where larger centres may be rewarded for generating their own power. Speakers noted that this last measure appears to be better adapted than the former to the data centre industry.

At the federal level, significant investments were announced, signalling Canada's intention to position itself as a leader in the industry. Specifically, the 2024 Budget provided for a $2 billion investment aimed at maintaining a competitive advantage for researchers and tech companies in the AI space.⁵ One participant advised that these investments should be committed to building the four fundamental which help turn data centres into the backbone of Canada's digital economy: power, telecommunications, security and fundamental research.

Ultimately, one of Canada's greatest competitive advantages in this space remains reliability in its many manifestations. This point was underscored on the day of the conference by Prime Minister Mark Carney's 2026 address at the World Economic Forum in Davos. There he framed Canada's "principled and pragmatic" path as a cornerstone of its global brand. In a world defined by great power rivalry and the weaponization of supply chains, Carney positioned Canada as a stable, rules-based alternative for nations seeking to diversify away from concentrated risk.

This stability is not just a diplomatic asset; it is a core component of "Brand Canada" that attracts the capital-intensive, long-term investments required for digital infrastructure.

Furthermore, the roundtable discussions highlighted a growing trend of "hedging risk"—a strategic shift as businesses and governments seek to ensure their digital assets are not subject to the unilateral shifts of foreign political or legal regimes. By investing in Canadian-owned and operated infrastructure, organizations can secure their data within a jurisdiction that prioritizes sovereignty and predictability.

This move toward strategic autonomy—not by building walls, but by strengthening domestic resilience—aligns with the "still strong and free" brand that continues to be a significant draw for the sector. Finally, Canada's federal structure—where provinces compete to attract investment—is also recognized as a strong advantage in this space. Businesses have a choice of competing provincial and territorial jurisdictions across Canada where they can carry on business.

Next steps

As Canada's digital infrastructure ambitions accelerate, early strategic decisions on energy, governance, location and trust will increasingly determine which projects succeed, scale and endure.

Developers, operators, investors and technology leaders are invited to connect with one of the authors or a member of Gowling WLG's Data Centre team to discuss project development, regulatory schemes and strategic advisory tailored to specific challenges raised by this fast-moving industry. Learn more at our strategic data centre hub.

Footnotes

1 Under the Chatham House Rule, participants may share the information or ideas from the discussions but may not attribute any information or idea to a participant or the participant's affiliation.

2 L.Q. 2025, c. 24.

3 Gowling WLG, Powering the cloud: How Alberta is reshaping its electricity system for data centres, January 12, 2026.

4 Government of Québec, Update on Québec's Economic and Financial Situation – Fall 2025, pages C.38-C.39.

5 Innovation, Science and Economic Development Canada, Canadian Sovereign AI Compute Strategy, October 31, 2025.

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