Notices of Meeting include information about the subject matter to be examined by the committee and date, time and place of the meeting, as well as a list of any witnesses scheduled to appear. The Evidence is the edited and revised transcript of what is said before a committee. The Minutes of Proceedings are the official record of the business conducted by the committee at a sitting.
Welcome to meeting number three of the House of Commons Standing Committee on Environment and Sustainable development. We are here to study zero-emission vehicles.
Today's meeting is taking place in a hybrid format, pursuant to the House order of September 23, 2020. The proceedings will be made available via the House of Commons website.
To ensure an orderly meeting, I would like to outline a few rules to follow. Members may speak in the official language of their choice. Interpretation services are available for this meeting. You have the choice at the bottom of your screen of the floor, English or French.
For members participating in person, proceed as you usually would when the whole committee is meeting in person in a committee room. Keep in mind the directives from the Board of Internal Economy regarding masking and health protocols.
Before speaking, please wait until I recognize you by name. If you are on the video conference, please click on the microphone icon to unmute yourself. For those in the room, your microphone will be controlled as normal by the proceedings and verification officer.
I'll remind you that all comments by members and witnesses should be addressed through the chair. When you are not speaking, please mute your mike.
Today we have four witnesses before us from the Department of the Environment, Department of Natural Resources, Department Transport and Department of Industry. In light of the tightness of time and the fact that the witnesses have already presented their speaking notes, I will deem their opening statements as read into the record.
[See appendix—Remarks by Helen Ryan]
[See appendix—Remarks by Sharon Irwin]
[See appendix—Remarks by Paula Vieira]
[See appendix—Remarks by Megan Nichols]
With that, we will start with Monsieur Godin.
I will be controlling the time.
Mr. Godin, I wrote in French what I just said, but the clock is ticking. I'll let you know when you have 30 seconds left.
Thank you to the witnesses for being here and for being patient, given the vote that was held in the House of Commons. After going over their presentations, I was wondering about something. I have a specific question for the witnesses from the four departments.
Can you confirm that Quebec and British Columbia account for 78% of all the electric vehicles sold in Canada? Kindly keep your answer brief.
Madam Chair, I'm done with that question. I'd like to switch topics. I got confirmation that it was indeed 78%.
Thank you, Ms. Nichols, from the Department of Transport.
The purpose of this study is to determine the feasibility of federal legislation on zero-emission vehicles. A number of programs were rolled out, so I'd like to know how they were designed and examined to ensure they were as effective as possible.
Given the importance of respecting provincial and territorial jurisdiction, did you consult the provinces and territories? If so, which ones? That question is for whomever can answer first.
I can confirm that we have a federal-provincial-territorial zero-emission vehicle working group. It has been meeting for a number of years. It meets to discuss best practices and lessons learned on how to increase the uptake of zero-emission vehicles.
Since the government has been in power, it has introduced various programs to achieve very specific targets: 10% in 2025, 30% in 2030 and 100% in 2040. In September 2020, Clean Energy Canada confirmed that Canada is going to miss those targets, just like the ones in the Paris agreement.
Do we have the tools we need to achieve them, and what's being done right now?
As a follow-up question, I'd like to know why Canada doesn't look to Quebec and British Columbia as models since they, alone, account for 78% of the electric vehicles sold in the country. I think the two provinces have expertise that the Canadian government should leverage to achieve Transport Canada's targets.
Certainly, Canada has set very ambitious ZEV sales targets of 10% in 2025, 30% in 2030 and 100% in 2040. We are making progress. In 2018 we were at 2% of zero-emission vehicle sales across the country. In 2019 we were at 3%. For the first half of 2020, we are at 3.4%.
Since the launch of the incentives for the zero-emission vehicles program, we have seen sales increase by 25% in the first year. We are making progress; however, we are continuing to assess progress to determine whether additional measures are required to meet these targets.
You have six minutes. According to the routine motions that we adopted at the first meeting, both you and the NDP have six minutes in the first round and you can ask any witness. Monsieur Godin chose Ms. Nichols, but you can choose whomever you want.
I'd like to start off with Clean Energy Canada. It's a great report. It looks as if the think tank is doing a lot of really good work that we're going to benefit from in our report.
One think I was looking for was that there's a SCRAP-IT program in British Columbia for taking vehicles off the road and helping to get new vehicles on the road. Did you do any work on whether a program such as SCRAP-IT, which provinces would run, would help to stimulate the purchase of zero-emission vehicles?
We are aware of B.C.'s SCRAP-IT program and of the success it has had in removing older vehicles from the road. As I mentioned earlier, we are continuing to look at potential additional tools to help us meet our zero-emission-vehicle sales target. I know that my colleagues at Natural Resources Canada and Innovation, Science and Economic Development may have additional information on such a program that they may wish to share.
This is one of the programs, one of the instruments that we have been looking at, to see how it can work together with the instruments and with the programming that is currently in place.
A SCRAP-IT program is used predominantly to accelerate fleet turnover. If that is the government's objective, to try to get consumers to make a purchase decision in advance of when they naturally would, then that instrument can be very effective. However, if what we're trying to do is simply to help incent ZEV purchases, then incentives are also very effective. It's really important to understand what the ultimate objective is. Is it to purchase more zero-emission vehicles or to accelerate the pace at which—
The interpreter just signalled that she can't interpret what's being said because the department official doesn't have the right tools to communicate clearly. That's a breach of my parliamentary rights. I would like access to interpretation. Can we find a solution?
As I previously noted, it is really important to understand the objective of the measures that we would put in place. Something like a SCRAP-IT program is very effective in accelerating fleet turnover. What that means is—
Recently, there was the announcement about the Ford Motor Company producing EVs and batteries in Canada at Windsor and Oakville. Fiat Chrysler has an announcement on hybrid vehicles or EVs in Canada. One of the presentations showed the difficulty that dealerships in Canada have in obtaining EVs.
Could you comment on when these programs will roll out and whether that can help us get more EVs through the dealerships?
With respect to the Ford and recent Fiat Chrysler announcements on the investments they're making, as negotiations with the unions came to a close in the last few weeks, certainly I think there is one thing we have to keep in mind. Those decisions are very key to the transformation of the automotive sector and in helping Canada reach its overall goals with respect to reductions of GHG emissions. It's important to understand that those particular decisions do take some time to be realized. The time between when a decision is made and when a firm brings that particular transformation to either a production or manufacturing line usually has about a four- to five-year window; so, of course, there will be a bit of a lag until we have that full, easy production within Canada. Certainly, it's a significant development in terms the transformation and electrification of the sector in Canada.
To Natural Resources, we've been working with the Ivy network in Ontario to get charging stations around the province to try to stimulate EV use and take that barrier away from its use. Could you talk about the progress of that system, please?
Ms. Vieira, in your brief, you talk a lot about range anxiety, but I'm inclined to point out that, first, there have to be vehicles. Has your department considered adopting a policy along the lines of a zero-emission mandate to address the supply problem?
Bear in mind that, like British Columbia and Quebec, 10 U.S. states, including California, have such mandates and all of those states and provinces have a supply of vehicles.
My question is for Ms. Vieira. In her brief, she talks a lot about range anxiety. What came to mind when I read that was the importance of having a supply of vehicles, first. I would point out that, like British Columbia and Quebec, 10 U.S. states, including California, have zero-emission mandates and all of those states and provinces have a supply of vehicles.
Has your department considered the possibility of adopting a zero-emission mandate to address the supply problem?
Thank you. We are looking at all measures, including regulatory measures, to ensure that we're supporting the entire value chain. What can increase supply? What can increase consumers' adoption? What are the enabling measures like infrastructure? We are looking at what combination of instruments it will take to increase deployment of EVs in Canada.
My question is for Helen Ryan. According to her brief, Environment and Climate Change Canada has legislative authority under the Canadian Environmental Protection Act, 1999. Before that, she mentions heavy-duty and light-duty vehicles.
Has the department explored policy options to deal with this specific issue? After all, the department has legislative authority to regulate light-duty, heavy-duty and off-road vehicles.
As I mentioned in the brief, under the Canadian Environmental Protection Act, we also have regulations to control greenhouse gas emissions from heavy-duty and light-duty vehicles.
For light-duty vehicles, our standards are based on the performance of vehicle fleets, and there are incentives for electric vehicles, hybrid vehicles and hydrogen vehicles. Automakers have to meet certain standards, and one way to do that is to supply zero-emission vehicles.
Coming back to the greenhouse gas emission regulations, I'd like to draw your attention to a study conducted by British Columbian John Axsen. He uses modelling to determine the failure or success rate in relation to the federal targets. The greenhouse gas emissions regulations alone won't ensure the targets are met.
Do you recognize that, in order to tackle climate change, the government needs to incentivize automakers to adapt and transition quickly?
As my colleague Ms. Vieira mentioned, we realize multiple elements need to be in place to increase the number of zero-emission vehicles, including incentives, infrastructure and education. The answer, then, is yes.
Ms. Vieira mentioned in the written statement that it's essential to support consumers through the entire consumer continuum, and Ms. Nichols wrote about the initiatives to help meet Canada's ZEV sales targets.
What work if any has been done to support the purchasing of used EVs, second-hand electric vehicles? For many Canadians, purchasing a new vehicle, whether it's gas or electric, isn't an option. With the high cost of rent, child care, medication and other essentials, 50% of Canadians are living paycheque to paycheque, and they often turn to second-hand vehicle purchases.
What are we doing to support these people and to ensure that electric vehicles aren't just for those who can afford a tens of thousands of dollars purchase?
Certainly while the incentives for a zero-emissions vehicle program do currently focus on new vehicle sales, we recognize there's an opportunity to make zero-emission vehicles more accessible to all Canadians. We also capture the used zero-emission vehicle market, and this was mentioned in ministerial mandate letters.
About 60% of vehicles acquired annually are done through the secondary market, so Transport Canada is currently exploring options to expand the program to include used vehicles.
Following up on Mr. Godin's question about targets, we did receive information from Clean Energy Canada, describing how Canada is not on track to meet its target of selling 100% zero-emission vehicles by 2040. They quoted Transport Canada:
Analysis has shown that without any further action, Canada could achieve zero-emissions vehicle sales of 4% to 6% of all new light-duty vehicles purchased by 2025 and 5% to 10% by 2030.
Ms. Nichols, you mentioned that we're exploring all options, but is there going to be a plan that outlines how we're going to meet the 10% target by 2020, 20% by 2030, 50% by 2040 and 100% by 2050—if I've got those right?
Yes. With the measures currently under way, we are hoping to see better performance than those previous numbers. We are closely tracking the progress made.
In budget 2019, $700 million was allocated to various measures to increase the uptake of zero-emission vehicles, not only the purchase incentive program but also additional funding for infrastructure as well as some other measures. So we do continue to assess progress to determine whether additional measures are needed.
It was mentioned that Environment and Climate Change Canada has legislative authority to regulate the sectors under the Canadian Environmental Protection Act. They've implemented six regulations under CEPA.
CEPA is over two decades old. It's in desperate need of modernization. Are there any current plans to develop regulations under CEPA that require automakers to achieve Canada's sales targets and a national zero-emission vehicle standard for passenger vehicles? This is probably for ECC.
We're currently undertaking a mid-term review of our light-duty vehicle regulations. The current regulations go out to model year 2025. They are aligned with the U.S. EPA regulations. We're undertaking a review, because when we first set those regulations, they were viewed by industry as quite ambitious.
Since then the U.S. has rolled back its standard and has put in place provisions that go out to model year 2026. We're finalizing our mid-term review to determine what action is needed in the context of our current regulations. We expect this work to be completed in early 2021.
With respect to exceeding our 2030 targets and getting to net zero by 2050, we're also evaluating what is needed with respect to the transportation sector, including for light-duty vehicles, heavy-duty vehicles and off-road vehicles.
I think Ms. Irwin, in her statement, mentioned the innovation and skills plan and the strategic innovation fund. I'm just wondering if work is going towards skills development training and transition for auto sector workers who have lost their jobs and want to work in electric vehicle production.
Specifically, to answer your question very directly, no. Our department has not undertaken studies to look at the feasibility of that in heavy-duty trucks. What we have been doing at ISED, through our programs such as the strategic innovation fund, is to engage with producers, parts manufacturers and others across the spectrum of light-duty vehicles and heavy-duty vehicles to see where we can support and incentivize research and development, as well as technology development for the lightweight reduction fuel efficiency. There are a number of elements there to help meet those targets.
Yes, we certainly are aware that the heavy-duty vehicle sector is a very significant source of greenhouse gas emissions in Canada. Of the emissions from the transport sector, it accounts for 35% of those emissions. It's certainly an area that needs to be addressed. There are a number of challenges and barriers that are unique to this sector. Certainly, one is the significant cost of the purchase of these vehicles. Another is that the technology is still very much in a development phase. While there are more and more models coming online, particularly for the return-to-base segment and shorter haul, there still remains a significant technology gap for long-haul, heavy-duty vehicles. There are barriers that need to be addressed across the spectrum. There's also the question of the availability of fuelling infrastructure, and also the development of necessary codes and standards. We continue to look at all of these areas. At this point it would be premature to comment on potential solutions the government may choose to bring forward.
I might just ask, further to that, with CUSMA and other international agreements, are there going to be difficulties trying to subsidize or to encourage transitions? In fact, could that even be illegal under these treaties?
Certainly, the heavy-duty vehicle regulatory frameworks are highly integrated between Canada and the U.S. I couldn't comment on barriers from a trade perspective, though. I would have to defer to experts in our international trade department.
I'm not aware of direct work to create a working group. However, there are a number of measures being considered under the heavy-duty regulations to look at ways to decarbonize, as well as working with other departments to see what combination of measures will accomplish this. There are some programs that have been put in place by provinces looking at retrofitting the existing fleet, for example energy-saving devices like skirts on trucks, deflectors and tires. Those are the main measures that improved the efficiency of the current fleet.
Are you saying that there have been no discussions to create a working group to get industry players in line with this, no efforts to get all of the people at the table to help develop these types of regulation?
I'd like to start with a question for Natural Resources Canada. One of the things that I've been reading about is that there's some consumer anxiety when it comes to the range of these vehicles—how far the batteries will last—especially in the winter. Are they going to have enough of a charge?
I know that Natural Resources Canada is undertaking a mass infrastructure program for mass EV adoption. What is your thinking on that range anxiety being one of the barriers to more adoption? What proposals do you have to limit that anxiety?
Range anxiety, absolutely, is a barrier to deployment. That is why Natural Resources Canada is spending over $300 million on two infrastructure programs to ensure that Canadians can charge coast to coast if driving their EV. In the coast-to-coast network, we are looking at having chargers every 65 kilometres on both sides of the highway. The reason we picked 65 kilometres—which is very much within the international standards for EV charging—is that even some of the lower technology vehicles have a range of at least 65 kilometres. Now many vehicles are well over 200 or 300 kilometres per battery recharge, but we wanted to ensure that there was quite frequent charging along the highways.
In 2019 we received an additional $130 million to get charging much closer to where Canadians work, live and play. It is really important to note that the lion's share of charging happens at home. The second most frequent charging happens at the workplace. Then you may think about highways and more public places. That is why, in our charging program, we are addressing all of those. We are addressing the highways, and having charging at home and in public places and the workplace.
The next question is for Transport Canada. As you're well aware, there was a recent report given to your department, the Dunsky Energy Consulting report, and one of the things they found is that this is mainly about supply. The supply has been reduced by 24%, and the supply is basically in two provinces. Madame Pauzé touched on this. I think that we need to change some of our policy direction.
When you look at B.C., Quebec, California, and Canada, the States or even China, they're adopting ZEV standards to make sure that they increase supply. Part of that is to give them certain credits they can trade or they can keep and sell to other companies. How are we going to incentivize companies to increase supply when it's already being done? Why are we not trying to make this pan-Canadian in some sort of way?
Certainly there is low inventory of some zero-emission vehicle models at Canadian dealerships, but despite that, we still have seen quite good uptake of the incentives for the zero-emission vehicle program across the country, even in provinces that do not have regulations or mandates for sales in place. We've seen significant increases. For example, in Saskatchewan in 2019 we saw sales increase by 95%. In Manitoba they were up by 71%. In Alberta, they were up by 53% from 2018 numbers.
That said, we know that we need a greater diversity of models in Canada to meet the needs of Canadians living in all types of communities and situations, and it's certainly something that's at the top of our minds. In terms of supply, we do recognize that it's an important element of making sure we meet our sales targets. As I said, that is why we continue to look at what additional measures would help us to achieve those.
Has Environment Canada thought about the uptick that will be required in electricity consumption as more people are adopting this technology? Madame Vieira was right that 80% of the charging happens at home. The other 20% is either at work or somewhere else. If more and more people on a street continually charge more and more, there will be an electrical uptick. Have we thought about how we're going to manage that surge in electricity?
The answer is yes. That is an issue that we are paying attention to, and we are looking at our electricity generation and supply system in order to be able to service the growing demand for electric vehicles.
My question is for you, Ms. Vieira. In your brief, you refer to a hydrogen strategy for Canada. The Pembina Institute contrasts green hydrogen with grey hydrogen and blue hydrogen. Is that something you've taken into account?
Yes, absolutely. The hydrogen strategy will look at all pathways to hydrogen production. What's really important is not the colour. There's actually an international initiative, of which Canada is a leading part, that is looking to get away from colours.
What's really important is the carbon intensity of hydrogen. With CCUS, we can produce hydrogen from natural gas in Alberta and in Saskatchewan that has the same carbon intensity as hydrogen produced from clean power—for example, through electrolysis. It's really important that we focus on clean hydrogen as well as carbon intensity.
I'm going to stop you there, Ms. Vieira, since I have just two and a half minutes.
In Quebec, hydroelectricity can produce hydrogen.
My next question is for Mrs. Irwin.
Naturally, automakers want to make money and profits. Although there is a demand, it's not strong enough. The only way to stimulate production is to create a market that can't be ignored, and that requires regulations. Would you agree with that?
With respect to your question as it relates to regulations, I would defer to my colleagues at environment and other departments to answer specifically anything related to that.
With respect to production, I think it's a fine balance in terms of our discussions with the industry, which is what ISED focuses on in understanding where the industry is at. There's a fine balance between the health of the industry, which is a major economic driver within the country, and supporting its transformation over a period of time, and the need to accelerate and to move more quickly towards electrification within our transportation sector in Canada. As—
Maybe I'll repeat my last question. It was about the work towards skills development, training and transition help for auto sector workers who have lost their jobs and who want to work in the electric vehicle production industry.
I believe that one was directed at me. Is that correct, Ms. Collins?
Ms. Laurel Collins: Yes.
Ms. Sharon Irwin: Okay. Thank you.
With respect to skills development and training for auto workers and other people who are looking to reskill and retrain, it's probably a question best directed at a colleague from Employment and Social Development Canada. Within ISED, our focus is on industry development and industry support, research and development, and technology, but certainly, in building those programs and working with the sector, those considerations about the benefits brought to Canada do come in, from both an economic and a social perspective.
Some sectors are seeing a downward trend in emissions, but transportation-related emissions have been rising by about 8% since 2015. It doesn't seem that we're on track to meet our climate targets or our emissions targets with electric vehicles. Even if light-duty vehicle emissions peak and drop, the heavy-duty truck emissions seem to be increasing.
When it comes to hydrogen fuelling stations, the documents that were provided talked about metropolitan areas, but not so much key freight corridors. The focus was more on natural gas refuelling. Is that just because of the technology that's available now? I'm wondering why that was the case and if there are other barriers.
Certainly, in the new programming that we got in 2019, we are looking at hydrogen refuelling along freight corridors as well, because we do see that as having huge potential for long-haul trucking, whereas with a battery, you would have no room for payload. Hydrogen is absolutely a huge opportunity for long-haul.
I have a question for the transport department. You said that approximately 60,000 Canadians, or Canadian businesses, have benefited from the incentives for zero-emission vehicles program, the iZEV program.
Can you further break down that number? Of those 60,000, how many Canadians and Canadian businesses have used this program?
No, in fact there is a limit to how many zero-emission vehicle purchases a business can make under the program. It's limited to 10 purchases per year. There is a limit, and it would be safe to say that the majority are by individual Canadians.
You're indicating that, essentially, more Canadians are walking into a dealership and buying a zero-emission vehicle than businesses. I get that there's a 10 limit per business, but that doesn't limit all businesses from going and then purchasing vehicles, is that correct?
Obviously, the cost is a major deterrent to purchasing a vehicle. That said, there's also the convenience or ability to ensure that you'll make it from point A to point B, mostly referring to Canadians who live in rural areas.
You've addressed a little bit of this, but I'm hoping you can answer this specific question. If the goal is to have everyone driving a zero-emission vehicle, what is being done to ensure that rural Canadians can conveniently charge their vehicles?
I believe that question would be for Natural Resources Canada. That is administered in the infrastructure program.
We are working with all jurisdictions to ensure that we are supporting projects in not only urban centres, but in rural locations as well. Actually, a lot of our coast-to-coast network does cover some rural locations.
We are working with stakeholders and provinces to amplify the availability of the program every time we put out a request for proposals. It is important to note that the business case in the rural communities where the charging will be very infrequent makes the business case very difficult. We are dependent on the private sector approaching the government to help de-risk those purchases. We are seeing that it is difficult to get the private sector interested in deploying infrastructure in locations where there is just not going to be large volumes of charging.
We are looking at making changes to the program, making the program more attractive and working with industry to ensure that we are enabling rural deployment of infrastructure as much as possible.
Thank you to all of our witnesses. I appreciate the work you do.
Regarding the electric vehicles subsidy for consumers, of the 60,000 users, how many purchases were replacing a gas-powered vehicle and how many were adding another car to their household while keeping the existing emitting vehicle? Do you track that information?
Thank you to all of the witnesses for being here today and for presenting to us.
My first question is around the impediments to zero-emission vehicle adoption. We've talked about a number of them here. I've read about a number of them. Impediments could be things like the range of vehicles, performance, reliability, the cost of purchasing the vehicle, the cost of the fuel or the electricity and the cost of maintenance or extra repair and parts. Maybe there are other obstacles.
I wonder if you could tell me what the most important obstacles are [Technical difficulty--Editor] to achieving the adoption levels that the government has laid out as targets. Which of those things that I've mentioned—or maybe there are others—would you identify as the most important obstacles to people adopting zero-emission vehicles?
I don't know if this question is is best placed for Ms. Ryan or for Ms. Nichols.
There is general agreement amongst experts that there are about four key barriers that need to be overcome. The first is the affordability barrier, as you mentioned. Zero-emission vehicles presently have higher purchase prices compared to ICE vehicles. The second one, as we've touched on several times this afternoon, is related to sufficient supply to make these vehicles in large numbers and available to Canadians. The third is the importance of access to charging and refuelling infrastructure to support more zero-emission vehicles on the road in all parts of the country. The fourth is around consumer awareness of zero-emission vehicles.
Those are really the four key barriers that there is quite wide consensus on.
Thank you for that answer. That's very informative.
As a result of that, is it fair to say that these are the areas where you're focusing your analysis or an evaluation of options to provide the necessary incentives? Not incentives necessarily.... Are these the areas where you're trying to identify incentives, where that's appropriate, and address some of the challenges that you've identified?
I think it's safe to say that. In budget 2019, $700 million was allocated to addressing many of these areas, such as the purchase program to address affordability and new funding for infrastructure to address the infrastructure question. That is certainly where we see most of the analysis that needs to be done.
I used to be a member of the provincial parliament in Ontario prior to being elected federally last year. One of the things that I know has changed is the Government of Ontario's policy with regard to incentives around zero-emissions vehicles.
Ms. Nichols, this is directed to you.
Could you quickly describe what the change in that policy has been and what the impact has been of that?
I can't speak specifically to the change in Ontario's policy. I can say that we did see a decrease in the percentage of zero-emissions vehicle sales in Ontario following that change. As I mentioned earlier, we have seen those numbers increasing again over the last year, specifically coinciding with the federal incentive purchase program.
We don't necessarily have a specific cost-per-tonne estimate yet for this particular program—again, being that it's fairly new. We do know that of the 60,000 vehicles that have been incentivized to date, they will bring reductions of about 207,000 tonnes per year. If you look over the vehicle's lifespan of about 12 years, it's about 2.5 million tonnes.
Madam Chair, if you can bear with me, I have information on some of the trends on some of the consumers who have taken advantage of the incentive. About 61% of the purchasers were between the ages of 35 and 59. About 86% of claims were from Canadians living in centres with a population of 30,000 people or more.
We are continuing, as I mentioned earlier, to gather more information on who, for example, is taking advantage of this.
Are you concerned about the situation where a manufacturer sets a base model just under the threshold price so that the purchaser can access the subsidy, and then later charges them extra for add-ons, ensuring that the taxpayer is essentially underwriting a luxury purchase?
Madam Chair, the way that the program has been designed is that if a vehicle meets the eligibility criteria the department has set out, then higher-priced trims on that vehicle can also be eligible, up to a certain cap.
I'm happy to go through that if the committee wishes.
What is the total lifetime greenhouse gas emissions impact of the average electric vehicle, including its manufacturer, and what is the greenhouse gas reduction impact per taxpayer dollar spent for this subsidy?
Sure. What is the total lifetime greenhouse gas emissions of an average electric vehicle, including the manufacturing process, and what is the greenhouse gas reduction impact per taxpayer dollar that is spent on the subsidy?
We actually do know, though, that your department has said that the estimated cost per tonne of greenhouse gas reduction from the subsidy was almost $900. This is highest per tonne of any government emission reduction program.
If the subsidy is expensive and only helping wealthy people buy cars that they were actually going to buy anyway and is not resulting in commensurate greenhouse gas reductions, what is the policy justification for this subsidy?
Madam Chair, we have set the eligibility thresholds for eligible vehicles to be within the range that we know Canadians do spend on vehicles on average, so that is why the current cap is set at $45,000 for base models for most vehicles and $55,000 for vehicles that seat more than six people.
You don't track household income. You don't track some of these other metrics we've talked about. Are we not essentially allowing people to subsidize a luxury car purchase? You said before that the base model has workarounds.
Madam Chair, I would just like to clarify that I don't think I mentioned anything about workarounds earlier. What I did say is that for vehicles whose base model costs $45,000, other trims up to a limit of $55,000 are also considered eligible. For vehicles that will accommodate more than six people, that base model can go up to $55,000. Then there is a cap for other trims set at $60,000.
I'd like to thank Ms. Pauzé for suggesting this study. It's clear that the work we are doing is timely and important to tackle climate change.
I'd like to piggyback on what Mr. Albas was saying. The electric vehicle subsidy for reducing greenhouse gas emissions is $900 per tonne. Did I hear that correctly? I'm not sure who can answer that. I believe I heard $900 per tonne of greenhouse gas emissions.
Madam Chair, I assume that the question is being directed to me.
I would just like to clarify, as mentioned earlier, that there are a number of ways to define and calculate cost per tonne. As I mentioned earlier, because the program is still in its early months, we have not yet finalized what that cost per tonne is.
I can say that, of the 60,000 vehicles incentivized to date, according to our estimates they brought reductions of about 207,000 tonnes per year and about 2.5 million tonnes over their lifespan. Also, the average reduction that is brought by a zero-emission vehicle on the road is about 3.5 tonnes over its lifetime.
When Canada reaches its target of replacing all gasoline-powered vehicles by 2040, do you have a general sense of how much it will reduce Canada's total greenhouse gas emissions, percentage-wise? I'm not looking for an exact figure.
Am I to understand that all charging stations being installed across Canada right now are for electric vehicles? Are some for vehicles powered by other fuel sources—ones that are more or less clean—like hydrogen? Are they all EV charging stations, or are there other types?
Natural gas, hydrogen, and electricity are really what we're talking about, but when it comes to passenger vehicles, the major source would be electric charging stations. You seem to mention that hydrogen and natural gas are more useful for freight vehicles. Is that correct?
That's correct. For light-duty vehicles it would be predominantly electric vehicle charging, although hydrogen stations are being deployed in metropolitan centres—for example, in Montreal, in Quebec City and in Vancouver—where original vehicle manufacturers are also deploying some hydrogen fleets.
It's just a quick question. I was in transit while that was happening. Were there two rounds that went by? Did we not pass a motion whereby the Bloc and the NDP were supposed to get their turns in between the Conservative and Liberal second rounds? Is that not correct?
Actually, I print only what the clerk gives me, and that printing says that in the first and second rounds, you got your two and a half minutes, and in the third round you were supposed to get your two and a half minutes, but we extended the time, and I had to clarify. You won't be able to ask the question, because the interpreters say they would not be able to translate if you are not—
With respect to the strategic innovation fund, there is a series of criteria applied, whether it be for an automotive company that applies through the program or others, setting out the economic benefits, the risks, societal benefits, etc. Certainly I should be able, if you wish, to give you a more detailed list as to what the criteria are for companies in making an application [Inaudible--Editor] for that program.
Sorry, but I'm going to stop you there to frame the question in a clearer way.
Does it have an environmental responsibility component? Specifically, are companies in the automobile industry held to account for their environmental performance as a condition of their funding? In other words, do you assess their environmental efficiency under the innovation fund?
The strategic innovation fund does not have a direct stream related to skills, retraining and those sorts of things. The streams that are within the fund relate to research and development, that promotes facilitating growth and expansion of firms in Canada, retaining and attracting large investments, projects that advance industrial research, development and technology demonstration, as well as large-scale national ecosystems.
In short, the program has an industry sector focus, and that's across a number of industries, of which the automotive sector is one that is a strong participant in the program.
I just want to go back to my question about the Canadian Environmental Protection Act. Would ECCC mind forwarding some written information about the specific regulations under CEPA that have to do with electric vehicle emission targeting, and additionally any reports or work that's being done or plans to develop regulations under CEPA that require automakers to achieve Canada's sales targets?
Madame Chair, in the written material that I provided in my opening statement, I included the links to our regulation, as well as the links to our annual report. If I'm not mistaken, I also included the links to the work being done on the mid-term evaluation. I'll see if there is any further documentation that we might have.
In that, I believe the six regulations under CEPA might have been mentioned, but I wonder specifically about the plans to develop or any work that has been done around regulations requiring automakers to achieve the targets.
The next question is to follow up on Madame Pauzé's question and Mr. Saini's question, that despite the growing demand for electric vehicles, we're still seeing the number of them accessible at dealerships decreasing—or at least they were in the past few years. Of the dealerships in Canada, 70% didn't have a single EV available for purchase, and the vast majority of them cited wait times of three to six months before someone could actually drive it off the lot.
In dealing with some of those accessibility issues, can you speak to the specific instruments that the government is employing to ensure that there are EVs available without long waits?
To build on previous answers, despite the low inventory of models across Canada, we still have seen some good uptake. However, we do recognize that limited supply continues to be a barrier to greater uptake of these vehicles. To that end we are continuing, with the other departments, to assess additional measures that we will need to consider to put Canada on track to meet its sales target.
Madam Chair, I know Mr. Scarpaleggia sought the same answers I did. A reporter had a story where their math was 270,000 tonnes per year, at a cost of $186 billion in rebates; that's where the $900 per tonne comes from. Transport Canada has not yet answered if it has its own estimate. Could Transport Canada supply the committee? Mr. Scarpaleggia, I believe deserves an answer.
Oh, don't worry. Ms. Nichols will get that request from the clerk.
Thank you very much. Thank you for staying half an hour. Mondays are always a bad day; we seem to end up having votes on Mondays. Thank you to the witnesses for coming in early. We hope that every witness comes with the right headset from now on.