The environmental footprint of an electric vehicle represents a sectorial industrial revolution, including the first lifecycle end of an EV battery. With existing technologies, 95% of an EV battery can be recycled for inclusion in a new EV battery and/or energy storage. The remaining 5% can be handled by third party recyclers. Because the price of mined lithium is rising exponentially, recycled EV battery materials are set to compete with mined content. The result is massive investments underway and planned for EV recycling, especially in China and Europe. The U.S federal government is supporting EV battery recycling and there is a nascent industry in Canada. But there remains a colossal challenge for the Canadian national and provincial governments to assure Canada is a major player alongside China and Europe.
Electric vehicles have been around for some time, but global automakers have been reluctant to migrate because doing so represents the biggest technological revolution since the Ford Model T.
This revolution entails scrapping a century of incremental investments in the internal combustion engine and replacing it with a 100 per cent different set of propulsion technologies, along with all the requirements to design their vehicles differently. This means it would take many years for automakers to recover their investments in electric vehicles (EVs), all while there are big profits to be made on conventional pick-ups and SUVs.
While North America’s automakers have been sluggish to respond, manufacturers elsewhere are prepared to comply with Chinese and European Union requirements for a migration to zero- and low-emission vehicles.
Oil’s brief dip into negative values this month was the result of fear that storage space would run out and buyers would have nowhere to put their oil amid the current pandemic. While widely reported, this sudden plunge is a distraction. Prices are now back above zero, but futures contracts (the price of oil delivery in the coming months) are expected to linger at unprecedented levels.
What’s important to take away from this sensational plunge in value is that the COVID-19 crisis has placed the fossil fuel sector in such a precarious state that it may accelerate the arrival of peak demand for all fossil fuels. This provides an opportunity to plan a Canadian transition to a green economy within upcoming recovery initiatives.
While General Motors is tying its decision to close its Oshawa, Ontario manufacturing facility to the rise of electric and autonomous vehicles, GM is not the only casualty of Canada’s inaction on clean transportation policy.
Other companies in the space are shifting their activities outside of Canada, opportunities within Canada are being missed, and Canadian cleantech leaders are losing their global competitive advantage, all for lack of a coherent national cleantech manufacturing strategy.
TM4 is one of several examples. The company is a world leader in electric vehicle motor powertrains. But its main manufacturing facility is in China, the world’s largest electric vehicle market, where TM4 products are produced under licence by Prestolite e-Propulsion Systems.
There’s not much urgency about tackling climate change and driving the switch to electric vehicles in Canada’s new federal budget. There are some incentives and voluntary targets for EVs but, on balance, the budget is an example of the mediocre policies holding North America back from catalysing the migration to electric vehicles (EVs). We now have proof from around the world that strong policies are what drives change.
China has disruptive legislation accompanied by a plethora of complementary measures. Canadian/North American initiatives are mild while the European Union is somewhere in between. The results are that China already offers a wide selection of EVs and sales are already booming, the European migration to EVs is imminent while North American governments and automakers are lagging behind, with modest exceptions in some progressive U.S. states and Québec and B.C..
These differences are important because the transportation sector accounts for approximately 60 per cent of oil consumption. Three studies confirm that even a moderate penetration of EVs will have devasting impacts on the petroleum sector. Even Shell believes peak oil is imminent and is engaged in major strides to migrate to clean tech and become the world’s largest power company.
The North American lack of urgency makes it harder for us to stop runaway climate change and even threatens the future of the North American auto industry.
The next federal government mandate will determine whether Canada complies with the Paris Agreement and makes the transition to a green economy. We must move quickly. As a former federal government “green” employee, I know government staff can deliver an effective climate change action plan within three months.
A green economy is one in which economic and sustainable development are fused together. A plethora of measures are required by way of annual budgets, legislative initiatives, policies and other agendas. The Liberals and Conservatives want us to believe that a price on carbon is a ballot question, but a carbon price is not a climate change action plan any more than buying a child winter clothing is a strategy for raising the child.