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Transportation

Over Half Canadians Opposed To Fed’s Unaffordable 2035 Ban On Gas Powered Cars

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Over Half of Canadians Oppose Fed’s Plan to Ban Sale of Conventional Vehicles by 2035: Poll
An electric vehicle is seen being charged in Ottawa on on July 13, 2022. The Canadian Press/Sean Kilpatrick

More than half of Canadians DO NOT support the federal government’s mandate to require all new cars sold in Canada to be electric by 2035, a recent Ipsos poll finds.

Canadians across the country are “a lot more hesitant to ban conventional cars than their elected representatives in Ottawa are,” said Krystle Wittevrongel, research director at the Montreal Economic Institute (MEI), in a news release on Oct. 3.

“They have legitimate concerns, most notably with the cost of those cars, and federal and provincial politicians should take note.”

The online poll, conducted by Ipsos on behalf of the MEI, surveyed 1,190 Canadians aged 18 and over between Sept. 18 and 22. Among the participants overall, 55 percent said they disagree with Ottawa’s decision to ban the sale of conventional vehicles by 2035 and mandate all new cars be electric or zero-emissions.

“In every region surveyed, a larger number of respondents were against the ban than in favour of it,” MEI said in the news release. According to the poll, the proportion of those against the ban was noticeably higher in Western Canada, at 63 percent, followed by the Atlantic provinces at 58 percent. In Ontario, 51 percent were against, and in Quebec, 48 percent were against.

In all, only 40 percent nationwide agreed with the federal mandate.

‘Lukewarm Attitude’

Just 1 in 10 Canadians own an electric vehicle (EV), the poll said. Among those who don’t, less than one-quarter (24 percent) said their next car would be electric.

Fewer Canadians Willing to Buy Electric Vehicles: Federal Research

ANALYSIS: ‘Bumpy Road’ Ahead as Canada Moves Toward 2035 EV Goals

A research report released by Natural Resources Canada (NRCan) in March this year suggests a trend similar to that of the Ipsos poll’s findings. The report indicated that only 36 percent of Canadians had considered buying an EV in 2024—down from 51 percent in 2022.

“Survey results reveal that Canadians hold mixed views on ZEVs [Zero-Emission Vehicles] and continue to have a general lack of knowledge about these vehicles,” said the report by EKOS Research Associate, which was commissioned by NRCan to conduct the online survey of 3,459 Canadians from Jan. 17 to Feb. 7.

The MEI cited a number of key reasons for “this lukewarm attitude” in adopting EVs, including high cost (70 percent), lack of charging infrastructure (66 percent), and reduced performance in Canada’s cold climate (64 percent).

Canada’s shift from gas-powered vehicles to EVs is guided by federal and provincial policies aimed at zero-emission transportation. The federal mandate requires all new light-duty vehicles, which include passenger cars, SUVs, and light trucks, sold by 2035 to be zero-emission—with interim targets of 20 percent by 2026 and 60 percent by 2030.

Some provincial policies, such as those in Quebec, are even stricter, including a planned ban on all gas-powered vehicles and used gas engines by 2035.

‘Unrealistic’

The MEI survey indicated that two-thirds of respondents (66 percent) said the mandate’s timeline is “unrealistic,” with only 26 percent saying Ottawa’s plan is realistic.

In addition, 76 percent of Canadians say the federal government’s environmental impact assessment process used for energy projects takes too long, with only 9 percent taking the opposite view, according to the survey.

A study by the Fraser Institute in March said that achieving Ottawa’s EV goal could increase Canada’s demand for electricity by 15.3 percent and require the equivalent of 10 new mega hydro dams or 13 large natural gas plants to be built within the next 11 years.

“For context, once Canada’s vehicle fleet is fully electric, it will require 10 new mega hydro dams (capable of producing 1,100 megawatts) nationwide, which is the size of British Columbia’s new Site C dam. It took approximately 10 years to plan and pass environmental regulations, and an additional decade to build. To date, Site C is expected to cost $16 billion,” said the think tank in a March 14 news release.

On April 25, Prime Minister Justin Trudeau announced that Canada since 2020 has attracted more than $46 billion cad in investments for projects to manufacture EVs and EV batteries and battery components. A Parliamentary Budget Officer report published July 18 said Ottawa and the provinces have jointly promised $52.5 billion cad in government support from Oct. 8, 2020, to April 25, 2024, which included tax credits, production subsidies, and capital investment for construction and other support.

On July 26, a company slated to build a major rechargeable battery manufacturing plant in Ontario announced that it would halt the project due to declining demand for EVs.

In a news release at the time, Umicore Rechargeable Battery Materials Canada Inc. said it was taking “immediate action” to address a “recent significant slowdown in short- and medium-term EV growth projections affecting its activities.”

For The Silo, Isaac Teo with contribution from the Canadian Press.

Isaac Teo
Transportation

How To Reboot Ottawa’s Zero Emission Vehicle Mandate

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The federal government has proposed regulations requiring the sale of a minimum numbers of Zero Emission Vehicles (ZEVs) in Canada (20 percent of all light vehicles in 2026, ramping up to 60 percent in 2030 and 100 percent in 2035). The flip side of this requirement is that the sale of internal combustion engine (ICE) light vehicles will be reduced and eventually prohibited in 2035.

  • This ZEV mandate will require an increase in ZEV sales from about 100,000 ZEV light vehicles in 2022 to 300,000 in 2026, 900,000 in 2030 and 1.5 million in 2035.
  • This paper examines whether or not Canadians will be able to buy enough ZEVs (either domestically produced or imported) to meet this ZEV mandate requirement. The findings show that Canada should be able to meet the 2035 100 percent ZEV mandate for about 270,000 passenger cars (only 18 percent of the market) but will be unlikely to meet the 2035 ZEV mandate for the 1,240,000 remaining light vehicles (pickup trucks, vans and SUVs/crossovers) comprising 82 percent of the market.
  • Canada cannot wait until 2035 to realize that the federal ZEV mandate will not be met. The gap between light-vehicle demand and forecasted ZEV light-vehicle supply will cause severe market disruptions. A better approach would be to reject a hardline ZEV mandate and instead to substitute a more flexible Plan B. Plan B should focus more on emissions rather than ZEV targets. For example, permitting some ICE light vehicles to be sold, particularly ones that can use renewable fuels. In addition, permitting plug-in hybrids (PHEVs) and hybrids to be included as ZEVs.
  • Finally, the federal government may have to accept that the 100 percent ZEV target is not feasible by 2035, and therefore must include flexibility in the federal ZEV mandate to back away from the 100 percent ZEV target.

A ZEV mandate is government legislation that imposes a requirement on the sellers of light vehicles to sell a certain minimum of ZEVs in a year. (ZEV is used interchangeably with BEV for battery electric vehicle in this paper. PHEVs can also qualify as ZEVs to a limited extent). The theory is that this minimum requirement will give certainty to vehicle sellers that there will be a market for ZEVs, and will therefore give an incentive to companies to construct ZEV manufacturing facilities. In essence, the ZEV mandate assumes that the demand for ZEVs will be there and will displace the demand for ICE light vehicles, and therefore the increase in supply of ZEVs will occur.

The federal government has introduced a ZEV mandate for all of Canada. In December 2022, the federal government issued proposed regulations under the Canadian Environmental Protection Act (CEPA). Section 30.3 of these proposed regulations state that all sales of light vehicles (passenger cars, pickup trucks, vans and SUVs/crossovers) must meet the thresholds for ZEV sales in a year shown in the table to the right.

Minimum Percentage of ZEV sales

The flip side to a ZEV mandate is that it imposes a prohibition on the sale of ICE vehicles, plus a penalty for contravening this prohibition. A company selling light vehicles in effect has an ever-shrinking quota for the maximum number of ICE light vehicles that it can sell in a year (none in 2035).

A company creates one credit for each battery electric vehicle (BEV) it sells. A sale of a PHEV with a range of more than 80 kilometres can also create a credit, but this ability is capped at 20 percent from 2028 onward. For example, a company selling 100 percent PHEVs in 2028 would only get credits for 20 percent.

If a company’s sales create fewer credits than required by the ZEV mandate, it can still remain in compliance by using two mechanisms. First, it can buy credits from another ZEV company that has exceeded its ZEV mandate. This mechanism will likely provide hundreds of millions of dollars of extra revenue to companies such as Tesla. An alternative second mechanism would allow the company to create a credit by contributing about $20,000 to specified ZEV activities such as supporting charging infrastructure. This second mechanism is capped at 10 percent of the ZEV mandate for the particular year, and is only available for the years prior to 2031.

For the Silo, Brian Livingston/The C.D. Howe Institute.

The author thanks Benjamin Dachis, Daniel Schwanen, Dave Collyer and anonymous reviewers for comments on an earlier draft. The author retains responsibility for any errors and the views expressed.