The Pembina Institute is calling for investment and targeted policy to support the shift to electric vehicle production in Canada and help address the financial fallout from the COVID-19 crisis.
In their report Power Play: Canada’s role in the electric vehicle transition, the energy think tank along with the International Council on Clean Transportation argue massive financial injections in electric vehicle production are needed to help Canadians weather the impacts of the global pandemic and stimulate Canada’s economy post-COVID-19.
Carolyn Kim, Ontario director, Pembina Institute says the “choices we make will help determine our competitiveness and economic success in a decarbonizing global market in the years to come.”
She argues that as demand for electric vehicles rises, Canada is at risk of losing market share and its position as a leader in automobile production.
Currently, Canada is the 12th largest vehicle producer in the world, but electric vehicle production in Canada is 80 per cent lower than the global average.
“Canada has an opportunity now to support Canadian workers across the auto manufacturing sector with financial injections for the light- and heavy-duty electric vehicle production sectors, and the hydrogen industry, paired with a comprehensive suite of policies, including a zero-emission vehicle sales mandate, to support local demand,” said Kim.
In terms of electric heavy duty vehicle production, or HDV, Canada ranks sixth in the world despite its relatively small share of the global electric HDV production.
Pembina and ICCT argue that the electrification of the transportation sector can play an important role as federal and provincial governments and industry seek to stabilize Canada’s economy while keeping Canada on a path to net-zero emissions by mid-century.
The report finds that although Canada has a strong history of auto production to build on, particularly in Ontario, targeted investments are needed to grow light-duty and heavy-duty electric vehicle production and demand.
Pembina and ICCT say that if Canada does not find a way to rapidly develop raw materials, supply base, and electric vehicle production, it is at risk of losing a major pillar of its economy as the market rapidly shifts toward electric vehicle adoption.
As a result, efforts should be focused on training workers to support the production of both light- and heavy-duty electric vehicles. Since 2012, there has been an increase of over 60 per cent of light-duty electric vehicle sales globally.
While the transition to electrification in trucking is in the early stages, Pembina and ICCT say Canada seems to be ahead of the curve, with several Canadian-based companies and manufacturing facilities that have emerged in recent years, concentrated in Quebec.
Lastly, the report recommends Canada build on its leadership in developing and producing hydrogen fuel cell technology, especially in heavy-duty vehicles. Hydrogen fuel cell vehicles are expected to play a larger role in the electrification of the commercial vehicle sector, opening up a critical opportunity for investment and associated job growth in Canada.