Ben Sharpe: Hi there, Canada. Thank you for taking the time to interview for the position of World Leader in the transition to electric vehicles. Let’s start off with an easy question: what’s new on the electric vehicle policy scene in Canada?
Government of Canada (GoC): Well, it was a big week for us here in Ottawa, as we released our 2030 Emissions Reduction Plan (ERP), which calls for reducing greenhouse gas emissions economy-wide by 40 to 45% below 2005 levels—and by 2030! Specific to vehicle electrification, we’re committing to a zero-emission vehicle (ZEV) regulation for new passenger cars that requires that ZEV sales reach 20% of all sales by 2026, 60% by 2030, and 100% by 2035. We’re also putting a new $1.7 billion tranche into the iZEV program for electric vehicle purchase incentives for consumers and businesses. And because we’ve got a lot of work to do on charging infrastructure, we’re earmarking $400 million in additional funding, which will add 50,000 more chargers to our nation’s network.
BS: I want to pick up on that last point, infrastructure roll-out. A recent ICCT study looked at charging in Quebec and found that the province will need eight times more public charging by 2030 compared to 2020. If Quebec—which leads Canada by far in deployment of charging infrastructure—has that far to go in less than a decade, we can assume that other provinces and territories are in much worse shape, especially rural and sparsely populated areas. Is there a strategy to support regions around the country where charging deployment has been limited to date?
GoC: The short answer is Yes! We recognize that 95% of electric vehicles are sold in Quebec, BC, and Ontario. Going forward, we must do a better job of increasing ZEV supply outside of the big three provinces and of better ensuring that consumers across the country see electric vehicles as a viable option. I mean, half of the car dealerships in Canada don’t have any electric vehicle models available for purchase or to test drive. We do believe that the ERP release this week is another strong signal that we’re serious about ZEVs, and it will give industry added motivation to continue increasing ZEV supply across the country. But, to be sure, we in government have to do our part to alleviate the chicken-egg dilemma by doing all we can to put in place a robust nationwide charging network as quickly as possible. That will be a huge task, given our country’s immense land area. But we’re up for the challenge!
BS: Why do you think Canada is a world leader on electric vehicles?
GoC: Several other countries—primary in Europe—have targets for 100% ZEV sales by either 2030 or 2035. But these countries are much smaller in terms of land area. I mentioned Canada’s massive size (fifth largest country in land area for those of you scoring at home!). For context, the United Kingdom also has a 2035 100% ZEV sales requirement but has a land area that is nearly 40 times smaller than Canada. Land area isn’t a perfect proxy for charging infrastructure needs, but it gives you a sense of the sheer scale of investment and coordination that will be required to make driving anywhere in Canada with an electric car a reality. We think that our 2035 target, coupled with the degree of difficulty on infrastructure, makes us a ZEV world leader.
BS: In your application, you mentioned some policy momentum on zero-emission trucks and buses. Can you elaborate?
GoC: We’re excited about the leadership we’ve seen from California and several U.S. states that have adopted mandatory requirements for increasing ZEV sales over time. Now we’re upping the ante. Our plan calls for a ZEV regulation for trucks and buses that will achieve 35% ZEV sales by 2030 and 100% by 2040. We also have nearly $550 million for a new purchase incentive program for combustion-free commercial vehicles. These incentives, coupled with Canada’s abundant supply of relatively cheap and low-carbon electricity, make the economics of zero-emission trucks and buses attractive in many applications. And the prospects for electric heavy-duty vehicles will only get better as prices of batteries and power electronics come down over time.
BS: You mentioned equity in your application, with regard to electric vehicles. What specifically does that mean for policy?
GoC: For electric vehicles to become mainstream, they must be accessible to consumers at all socioeconomic levels. Incentives to bring down the cost of new ZEVs aren’t enough, since sales of used cars outnumber sales of new cars by two to three times. One piece of low-hanging fruit for the federal government is to provide incentive funds for used ZEV purchases, as is currently done in Québec, Nova Scotia, and Prince Edward Island. For freight trucks, we really need to pay attention to small businesses, since about a third of all tractor-trailers on the road are owned by companies with five or fewer trucks in their fleets. The higher upfront costs of electric trucks and the added complication of recharging these vehicles represents an even bigger challenge to smaller fleets and owner-operators.
BS: Anything else you’d like to share?
GoC: Canada is stepping into the ZEV driver’s seat, eh?