If present trends continue, transportation will be the Canadian largest source of greenhouse gas emissions by 2030. Canada’s objective for a legislated 2035 zero-emission vehicle (ZEV) target for all new light duty models is too little, too late. Canada can adopt incremental legislative objectives between now and 2035, much like what the European Union and China have done. The latter jurisdictions may reach 50% ZEVs, mostly electric vehicles, by 2025. Just as automakers can adjust to safety regulations while offering vast lineups of trendy vehicles, they can do the same with Canadian ZEV regulatory mandates.
Transportation impacts on climate change
Canada, according to an October 2021 Carbon Brief report, currently has the highest cumulative emissions per population in the world, closely followed, by the U.S., in second place.
According to an Electric Mobility Canada (EMC) presentation at their virtual annual conference Oct-5-7, 2021, transportation consumption related emissions represent 25 percent of Canada’s total emissions. By 2030, transportation will be Canada’s number one source of emissions.
When upstream emissions are taken into account, oil extraction, oil refining and refined product transport, the current transport share of total Canadian emissions comes to 31.25 percent. Road transportation accounts for over 80 percent of Canadian transportation emissions.
The Canadian transportation portrait is exacerbated by having the distinction of having the highest emissions per km driven in the world. It would appear that Canadians drive more large engine SUVs and pick-up trucks than elsewhere.
Emissions from light duty trucks have increased 169 percent in the last 30 years, while emissions from conventional models have decreased 9 percent over the same period.
In the 21 municipalities of Metro Vancouver, transportation accounts for 40 percent of local emissions, 75 percent stemming from light duty vehicles. Approximately 70 percent of trips are represented by personal transportation.
With about 1.4 vehicles per household, it is clear that a staggering leap must be made for significant transition favouring public transportation, cycling and car-sharing. Evidently, part of the answer includes curbing urban sprawl. These are things that only government initiatives can alter.
This is a tall order given Canada’s starting point and the proliferation of workplaces outside city centres. The decentralization trend goes against the grain for public transport oriented to mobility to and from downtown areas. As a result, while public transportation has an enormous potential to reduce dependencies on personal vehicles and traffic congestion, private transportation will remain a significant portion of transportation emissions.
Clearly, vehicle sector regulatory and policy initiatives are critical components of an effective Canadian climate action plan.
Legislation in Canada and elsewhere
The Trudeau administration has made a declaration that it will legislate a requirement that every new light duty vehicle (LDV) must be zero-emission vehicle (ZEV) in 2035. That’s nice, but the actions of other jurisdictions may imply that all new passenger vehicles will be ZEVs in 2035 anyway.
What is missing in Canada is not having any legislated ZEV sales targets between now and 2035. Vague government statements have suggested 50 percent of LDV sales must be ZEVs by 2030, but nothing official has been divulged. How Canada will reach 50 percent electric vehicle (EV) sales is a mystery.
Third quarter 2021 EV sales at 5.3 percent of the market. Based on current and planned Government of Canada measures and data, this will rise up to 10 percent by 2025 and reach 18-24 percent by 2030. Evidently, the two provinces with EV rebates, BC and Quebec, have skewed the national average with 13 percent and 9.9 percent EV sales respectively, compared to Ontario coming in at 3.1 percent. This is especially reflected in EV sales percentages in Vancouver 15.6 percent, Montreal 11 percent and Toronto 4 percent.
The above-mentioned Canadian federal projections sharply contrast with those of Stellantis (formerly Fiat Chrysler) which estimates that EVs will represent 40 percent of its sales in the U.S. in 2030.
The absence of a federal plan between now and 2030 and failure to acknowledge what is feasible in the interim, equally contrasts with the City of Montreal target of 47 percent of vehicles to be EVs by 2030.
The difference between the federal game plan regarding the interim years applies also to that of Metro Vancouver for a 55 percent greenhouse gas (GHG) reduction target from personal transportation by 2030.
The preceding projections of municipalities may be hard to compare, but definitely illustrate that the federal government can do better.
A similar vacuum in actions over the coming decade, and thereafter, exists with the federal overarching Law C-12, The Canadian Net-Zero Emissions Accountability Act. The Act requires that the Government of Canada have a climate plan in place for 2030 and every subsequent 5 years. As such, the Act leaves a void between now and 2030. Canada will have an interim target in 2026, but this will not be a mandatory goal. And the law does not stipulate any consequences for missing a legislated target.
Notwithstanding the Canadian climate action gap between now and several elections to come, a rapid and massive the transition to electric vehicles is underway.
Specifically, the world is well into a vehicle sector industrial revolution. Automakers and the auto parts industry must scrap a century of incremental investments in internal combustion engine vehicles; work from a blank page to develop EV engines and propulsion systems; conceive batteries and battery recycling capacity; and embrace blueprints for new vehicle shapes, from the ground up, for models that can accommodate the new technologies. Cumulatively this implies investments of billions in each automaker’s EV supply chain.
This revolution, involving several hundreds of billions of investments, is happening because of the vehicle emission legislative initiatives in China and the European Union (EU), the largest and third largest vehicle markets. Since most major automakers are global enterprises, and all must compete in the global economy in critical markets, the actions of these two jurisdictions have global impacts. The vehicle industry is not engaged in a swift expensive revolution because it wants to, rather because it has to.
Thanks to their head start, China and the EU are ahead of the pack in both the development of the EV supply chain and the proportions of new vehicle sales that are EVs. In 2021, up to September, 24 percent of LDV sales in Germany were EVs and plug-in hybrids. Based on the rate of EV adoption in the EU and China, these jurisdictions may reach 50 percent EV sales by 2025.
Ford plans call for 100 percent of its European lineup to be electric by 2030.
Norway will ban the internal combustion engine vehicle (ICEV) for 2025. The Netherlands, Denmark, the U.K., Germany, Belgium, France, Iceland, India, Ireland, Israel, Slovenia, Slovakia and Sweden will do so for 2030.
EMC believes Canada too should have a ZEV legislated LDV mandate by 2030 along with a ZEV requirement for medium and heavy duty trucks at least by 2040.
Will Canadian consumers buy electric vehicles?
It seems that consumer choices of vehicle types are much like clothing fashion. Nobody wants to buy bell bottom jeans anymore. In the same vein, conventional two-wheel drive small sedans are not now in vogue.
But the vast range of models on the market all comply with vehicle safety regulations. Similarly, if all vehicles were required to conform with zero and low-emission regulations, the choices would be as immense for “cool”, “prestige” and other trendy vehicles. The automakers would make sure of that.
To get a consumer to shift to a zero emission vehicle (ZEV), there must be EVs on the market that resemble the category of the internal combustion engine vehicles (ICEV) the consumer already owns.
With the right regulatory framework, consumers will have a complete array of electric vehicles, meaning ICEVs will not be missed.
The owner of an ICEV Ford F-150 pick-up is not likely to be attracted to an EV compact car. Ditto for the owners of large ICEV luxury vehicles. Right now, most of the EVs available are compact vehicles. Between now and 2025, the EV lineups will greatly expand to cover all segments of the market.
The Ford-150 EV version, the F-150 Lightening, will be on the market in 2022. The current F-150 is the bestselling vehicle on the Canadian market.
At the high-end, Mercedes has committed US$47 billion to its electric EQ lineup. The company will have 3 dedicated electric platforms by 2025. The top of the line EQS sedan will hit the North American market in 2022.
Will truck fleet owners go electric?
For trucks, the momentum is already in gear.
Having invested several hundred million in the U.S. start-up Rivian, Amazon has pre-ordered 100,000 Rivian electric trucks for U.S. roads by 2030, the first of which have already appeared on the U.S. truck transportation landscape. On its first day on NASDAQ in early November 2021, the Rivian initial public offering brought in US$11.9 billion achieving the biggest listing of 2021, ending the day at a valued at US$88 billion, more than that of Ford and at par with GM.
In addition, Amazon has signed an agreement with Quebec’s Lion Electric to reserve up to 2,500 trucks by 2025. For 2025 to 2030, Amazon has the option to acquire 10 percent of Lion’s electric truck production, which could bring the total to 10,000 to 15,000 electric trucks by 2030. Amazon has an option to acquire up to 20 percent interest in Lion.
Another major electric truck development to come is that of FedEx which has indicated half of its purchases will be electric by 2025. FedEx has begun the transition with an order of 500 units of GM’s Brightdrop EV600 which will be manufactured in Ingersol, Ontario.
The U.S. national fleet manager, Merchants Marine, has ordered 12,600 EV600 vans for acquisition over the next 2 years.
On the potential for small cargo vans to go electric, research in the Greater Toronto Hamilton Area revealed most of the commercial vehicles in urban centres are cargo vans making last mile deliveries, only traveling 60 km/day. This means that these vans can be readily charged overnight.
Canada and the myth of the integrated North American market
A longstanding federal tradition is Canada must emulate U.S. vehicle initiatives. This tradition remains intact today to the effect that Canada has little choice but to be aligned with U.S. initiatives as much as possible. The rationale persistently given is that the Canadian vehicle industry is part of an integrated North American industry. This was emphasized at the October 2021 EMC conference.
This leads us to the Biden administration ZEV intentions for 2030. So far, the descriptions of these intentions are nebulous, 50 percent of sales electrified by 2030, but this could include plug-in hybrids, 5 years behind the EU and China.
The Canadian federal movie played over and over again regarding the integrated North American market no longer applies in the global economy with global automakers. Global automakers can more closely approach EU EV sales proportions in Canada.
Canada need only adopt legislation with incremental vehicle emission objectives, much like what the EU has done, adjusted for a Canadian context. To-date, federal intentions for the attainment of the 100 percent ZEV goal in 2035 rely on reviewing ZEV awareness campaigns, rebate continuity, subsidies for charging stations, marketplace signals and collaboration with the U.S.
Yet, as indicated earlier, vehicle safety regulations have proven that vehicle manufacturers can comply with new sets of regulations while offering consumers equivalent ranges of “trendy” choices at reasonable prices.
Consequently, Canadian incremental emission standards, EU style, are not only feasible in the marketplace. Such an adoption would also encourage global vehicle and supply chain stakeholders to render Canada a North American preference to establish EV manufacturing and R & D facilities on the continent.
Especially important, following in the EU footsteps would immensely improve Canada’s capability to reach its 2030 greenhouse gas emission (GHG) target of 40-45 percent by 2030, based on 2005 levels.
Indeed, the Trudeau administration target is sheepish compared to the European Climate Law adopted by the EU in June 2021 to reduce emissions by at least 55 percent by 2030, based on 1990 levels. The European Commission 3,500-page Fit for 55 proposed measures to comply with the European Climate Law include more demanding emission standards for vehicles and a 55 percent fleet average emissions reduction by 2030, compared to 2021 existing requirements.
Transportation: One of the cracks in achieving Paris Agreement compliance
Based on trends in the EU and China where stringent vehicle emissions legislation exists plus the ICEV 2030 bans in several countries, Canada would be within the realm of modest regulatory targets with requirements for 75 percent ZEV LDV sales for 2030 and an interim goal of 25 percent by 2025.
The above is an especially docile suggestion in that the CleanBC Roadmap to 2030 calls for 90 percent LDV ZEV sales by 2030 and includes a target for 26 percent by 2026.
Like the federal and Quebec governments, BC has a 100 percent ZEV goal for 2035.
However, the federal, BC and Quebec ZEV goals fall short of the aforementioned 100 percent EMC ZEV mandate for 2030. Among EMC measures proposed to achieve this goal are tax levies for high fuel consumption vehicles to support rebates for EVs; financial support for fleet transitions; and changes to building codes regarding charging infrastructure.
With transportation headed to be the number one source of Canadian emissions by the end of the decade, it is clear that incremental LDV regulatory mandates are essential to put Canada on the right track to achieve the current Canadian 40-45 percent total emissions reduction target by 2030, over 2005 levels.
Even conservative incremental LDV ZEV goals up to 2030 exceeding the timid inclinations of President Biden, would set the stage for Canada to be a North American leader, both at the vehicle sales and manufacturing levels.
Right now, the missing link is political will for the reduction of emissions transportation which is intertwined with emissions from the fossil fuels industry.
Accordingly, along with massive investments in public transit, vehicle regulatory parameters of the types proposed here are the MINIMUM required to achieving Canada’s 2030 existing Canadian GHG reduction goals.
Furthermore, in light of transportation share Canadian GHG sources, it is important to underline that Canada’s GHG target for 2030 is inadequate to align with the Paris Agreement.
Canada has never met any of its GHG reduction goals in the past. This has to change, and it can be corrected. To quote the late Jack Layton, “Don’t let them tell you, it can’t be done”.
Note, a big thank you to the Electric Mobility Canada virtual conference, Oct 5-7, 2021, a source of considerable information that appears in this article, but not the analysis/perspectives found here.