Ottawa is set to unveil its anticipated electric vehicle (EV) regulations on Tuesday, which aim to ensure that all new passenger cars sold in Canada by 2035 are zero-emission vehicles, according to a senior government source.
These regulations, named the Electric Vehicle Availability Standard, are intended to compel automakers to produce sufficient affordable zero-emission vehicles to meet the rising demand. The Canadian government is particularly concerned about other countries, such as the U.S., dominating the supply of zero-emission vehicles, as some U.S. states have already implemented sales targets for such vehicles.
The regulations will apply to automakers, who must earn credits to demonstrate compliance with the targets. These credits are based on the number of low- and no-emissions vehicles sold, with various vehicles earning different credit amounts based on their proximity to a zero-emissions standard.
Automakers can also earn early credits by introducing more EVs to the market before 2026, up to a maximum of 10% of their overall compliance requirements for that year. Additionally, they can gain more credits by contributing to the expansion of EV charging infrastructure.
Companies that exceed or fall short of their targets can sell or buy credits from other companies or use previously banked credits.
The government intends to release further details about these regulations, which will be enacted under the Canadian Environmental Protection Act, on Tuesday. The regulations will take effect in model year 2026, with increasing sales targets leading up to 2035.
The federal government’s goal is for 20% of all vehicles sold to be zero-emission vehicles by 2026, rising to 60% by 2030 and 100% by 2035. These efforts are part of the government’s plan to reduce greenhouse gas emissions and combat air pollution resulting from the transportation sector.
However, auto industry representatives argue that the sales mandates are too aggressive and suggest that the government should create incentives rather than dictate individual purchasing choices. They also raise concerns about affordability, charging infrastructure, and the capacity of the electric grid to handle the increasing demand for EVs. Despite these challenges, the government aims to facilitate an equitable transition to EVs and ensure accessibility for all Canadians.
Environmental organizations and think-tanks argue that EVs will save money for households, and a recent report suggests that a typical Canadian household could save up to $4,000 annually by switching to an electric vehicle.