Despite the growing demand for electric vehicles, it appears that Canada will still fall short of meeting its zero-emission vehicle sales targets by 2025 despite government rebates tax credits.
Transport Canada has recently revealed that its target of having 10% of all passenger vehicle sales in Canada being electric will likely not be achieved by 2025, nor will its targets of 30% by 2030 and 100% by 2040. Instead, the most recent analysis suggests that Canada will only reach approximately 4% to 6% of electric vehicle sales by 2025, and 10% by 2030. Transport Canada director general of environment policy Megan Nichols said to the House of Commons back in October that although the demand for zero-emission vehicles has been rising, the government still needs to do more in terms of reaching its sales targets.
Currently, the rebates provided by the federal government include a $5,000 rebate for the purchase of a new, fully electric car, and a $2,500 rebate for plug-in hybrid models. However, in order for consumers to quality for the rebates, the base model purchase price cannot exceed $45,000 – something that is likely to disqualify some models of EV car makers such as Tesla. Nonetheless, the $300 million program, which was first unveiled back in May 2019, has only $45 million in rebates remaining, despite scheduled to not phase out until at least 2022.
According to Clean Energy Canada senior policy adviser Joanna Kyriazis, the federal government needs to do more in order to achieve its existing targets, including extending the current rebates to cover the sale of used cars, in addition to targeting rebates towards Canadians that would otherwise be unable to afford an electric vehicle. Moreover, Kyriazis suggests that an electric car mandate that would legislate sales targets should also be implemented. British Columbia and Quebec are currently the only two provinces that have both sales quotas and provincial rebates, and as a result they accounted for nearly 8 out of 10 electric vehicle purchases.
According to data compiled by Statistics Canada, new vehicle registrations of electric and plug-in hybrid vehicles rose from just over 500 in 2011 to more than 50,000 in 2019, which amounts to an increase of over 97%. Likewise, passenger vehicles create over one-tenth of Canada’s greenhouse gas emissions, and despite the introduction of more stringent emission standards, total emissions have nonetheless increased by 10% over the last decade.
Information for this briefing was found via the Associated Press. The author has no securities or affiliations related to this organization. Not a recommendation to buy or sell. Always do additional research and consult a professional before purchasing a security. The author holds no licenses.