The government of Prime Minister Justin Trudeau will require the sale of electric vehicles and seek a 42% reduction in emissions from the oil and gas industry as part of Canada’s strategy to fulfil its 2030 emissions reduction target.
The government states in its 2030 Emissions Reduction Plan that it would establish a sales requirement to guarantee that at least 20% of new light-duty vehicle sales be zero-emission cars by 2026, 60% by 2030, and 100% by 2035.
The Government of Canada’s goal to reduce emissions from medium- and heavy-duty vehicles (MHDVs) is to have ZEVs account for 35% of total MHDV sales by 2030. It makes no mention in the report of “mandating” those numbers in the same manner that it does for light-duty vehicles.
The government has announced an increase in the electric vehicle incentive scheme of C$1.7 billion ($1.36 billion).
According to The Canadian Press, the upcoming government budget is set to expand the scheme to cover used vehicles and more costly EV models, allowing new SUVs and pickup trucks to qualify.
In Canada, for example, the Ford F-150 Lightning and Chevrolet Silverado EV will both start at around — or beyond — C$60,000.
Additionally, the government will invest an extra C$400 million in ZEV charging stations, advancing its goal of adding 50,000 ZEV chargers to Canada’s network. Additionally, the Canada Infrastructure Bank will invest C$500 million in electric vehicle charging infrastructure.
Transportation accounts for 25% of total emissions and has increased its carbon footprint by 16% over the previous 17 years, according to the plan.
According to David Adams, CEO of the Global Automakers of Canada, which represents the interests of all brands in Canada except the Detroit 3, “the automobile sector is totally committed to decarbonizing its products,” but the plan still requires effort and further specifics.
“The Minister’s report issued on March 29 lacks clarity about previously announced commitments to ZEV purchase incentives and charging infrastructure, as well as what additional cash is truly required to encourage Canadians to make the switch,” he said in a statement.
“Regardless of this lack of clarity, the greater issue is the increasing aim – mandated by legislation – for 20% ZEV sales by 2026 and ‘at least 60%’ ZEV sales by 2030.
“We want some confidence that the customer will accompany us on this journey, which is not quite obvious at the moment.”
Ambitious objectives
Trudeau’s proposal commits to establishing a carbon-capture tax credit for business by 2022, with specifics to be provided “soon.” It does not, however, contain details on the emissions cap the government intends to impose on the fossil-fuel industry, which accounts for roughly a tenth of overall economic output in Canada.
The agreement, which Environment Minister Steven Guilbeault tabled in parliament on Tuesday, commits Canada to an additional C$9.1 billion in new expenditure to meet the country’s climate commitments. By 2030, the government intends to cut emissions by more than 40% below 2005 levels.
Guilbeault told Bloomberg earlier this month that current initiatives, such as the phase-out of coal-fired energy generation and the adoption of a national carbon price, had already put the country on course to cut emissions by 36%. Passing the 40% mark, he stated, would take “a great deal of heavy lifting.”
It will not be inexpensive. According to a Royal Bank of Canada research last October, the total investment required over the next three decades to get Canada to net zero is C$2 trillion, which amounts to at least C$60 billion in annual spending given existing technology.
According to the new strategy, the government is aiming to cut oil and gas methane emissions by at least 75% by 2030 and to encourage sustainable technology that will further decarbonize the sector.
Canada produced 730 megatons of carbon dioxide equivalent in total greenhouse gas emissions in 2019. Petroleum and natural gas production account for around 26% of total emissions, and the government will mainly rely on the carbon capture tax credit and the emissions cap to guarantee the industry meets its targets.
The government stated that a discussion paper on the emissions cap will be released this spring, followed by discussions with provinces, Indigenous partners, business, and civil society. Additionally, the government stated that it does not intend to utilise the restriction to reduce output that is “not driven by global demand reductions.”
Trudeau vowed during last year’s election campaign that his Liberals would require oil and gas corporations to establish five-year emission reduction targets with the goal of attaining net zero emissions by 2050. The programme is scheduled to launch in 2025. A component of this proposal is a C$2 billion fund dedicated to green employment creation in oil-producing regions.
Canada is the only Group of Seven countries whose harmful emissions increased between 2015 and 2019. Trudeau has laid the burden for his country’s emissions record to date squarely on the shoulders of the previous Conservative administration, which withdrew from the Kyoto treaty in 2011, a forerunner to the 2015 Paris deal. Additionally, the prime minister stated that four years of climate denial in the United States under Donald Trump effectively held back Canada.
This study was compiled with the assistance of Bloomberg.