Ottawa: All new vehicles to be electric by 2035; but young buyers need lower EV costs & more chargers

As 2023 fades into memory and we begin to make our resolutions for the new year, investing in an electric vehicle might top your list. 

That’s what the federal government is hoping, as it unveils its Electric Vehicle Availability Standard which provides a roadmap for achieving a 60 percent share of new vehicle sales being electric by 2030 and 100 percent by 2035. 

According to Environment and Climate Change Canada, the transportation sector makes up approximately 25 percent of Canada’s overall greenhouse gas emissions. About half of this comes from light-duty vehicles, which includes passenger cars, SUVs and light trucks. In order to achieve the federal targets of a 40 percent reduction in greenhouse gas emissions below 2005 levels by 2030 and net zero by 2050, Canada must work rapidly to adapt the transportation sector.

According to a government analysis from 2022, when the draft of the standards was released, the implementation of the new requirements would prevent the release of approximately 430 million tonnes of greenhouse gas emissions, the equivalent of about 65 percent of Canada’s total greenhouse gas emission in 2021. 

The standards are coupled with further commitments to enhance charging infrastructure, investing over $1.2 billion toward charging stations across the country to bring 43,000 individual chargers online, almost double the current number. A recent audit by the Environment Commissioner found most of these chargers are installed in British Columbia, Quebec and Ontario, leaving other provinces with very little accessibility, something the government plans to change.  

Another concern that has surrounded EV adoption in Canada is accessibility for rural and northern communities. While the strategy addresses evolving technologies to enhance cold weather performance of batteries, it does not make any mention of improving charging infrastructure in the north.

“Canadians are leaders in building a sustainable transportation future, and the Government of Canada is supporting them,” Julie Dabrusin, Parliamentary Secretary to the Minister of Environment and Climate Change and to the Minister of Energy and Natural Resources, said in a press release. “Across the country this year, we deployed tens of thousands of electric vehicle chargers and secured historic job-creating projects across the critical minerals and battery value chain.”

While the ambitious targets will help support Canada in building a sustainable future — the monetized benefits of greenhouse gas reductions from these goals is estimated to be between $78.6 billion and $90 billion — auto industry experts note two key flaws in the plan: EV costs and charging availability.

“Achieving 100 percent ZEV sales requires a comprehensive, long-term plan to support ZEV adoption that includes stronger consumer purchase incentives, a widespread public charging network, and enhancements to the electricity grid to prepare Canada for more ZEVs on the road,” Brian Kingston, president and CEO of the Canadian Vehicle Manufacturer’s Association, said in a press release.

The purchase of a first vehicle is a milestone for many Canadians, but factors like cost and comfort often override sustainability. The electric model KIA pictured above is twice the price of some entry level vehicles that are not electric.

(Dilawri)

The Pointer used social media to reach out to dozens of young adults between the ages of 20 and 30 to get their perspective on electric vehicle use. The poll was public for 24 hours and asked three questions: whether the consumer would ever consider purchasing an EV, what their number one concern when purchasing a vehicle was and what their number one barrier to purchasing an EV was. Out of the 27 responses, 21 said they were interested in purchasing an electric vehicle; however, their interest was greatly hindered by cost.

Eighty-one percent of respondents said cost was their number one concern when purchasing a vehicle. Given the current state of the Canadian economy, even those who identify as caring about sustainability, said cost is the main driver when deciding on a vehicle purchase. 

The median income in Ontario is about $42,000 while the average cost of a home is $900,000. Even for renters, Ontario has some of the most costly rates in the country, with the average rent for a one bedroom apartment going for $2,500 in Toronto, $2,300 in Mississauga, $2,100 in Ottawa and $1,800 in Hamilton. On top of accommodation, food costs are at an all time high with a seven-percent increase in 2023, a trend that is expected to continue in 2024. With increases in costs of living far outpacing wage increases, there is no surprise that young consumers are turning away from the $50,000-plus price tag of a new electric vehicle.

The Chevrolet Bolt, for example, is an entry level compact EV, and would cost a buyer close to $50,000 to put the cheapest model on the road. The popular Toyota Prius, which is larger, would cost about the same for the base model. 

But despite the hefty price tag upfront, EVs often end up being the cheaper alternative. 

“It's already much cheaper to buy an electric car because of the total cost of ownership if you consider that the cost of fuel is 20 percent. When you fill up with a gas car and it costs you $100 to fill the tank, to get the same distance out of an electric car, you're paying about $20 in electricity,” Tim Burrows, President of the Mississauga chapter of the Electric Vehicle Society, told The Pointer. “So it's a huge saving. The more you drive, the more you save.”

In addition to savings on fuel, EVs also avoid much of the wear and tear costs that often creep up on consumers when they least expect it. With EVs, there are no worries about replacing mufflers, spark plugs and oil changes, just a few benefits of moving away from internal combustion vehicles. The only major parts of an electric vehicle that need to be replaced are the battery and the tires, and tires have an average lifespan of 10 years while EV batteries can last anywhere between 10 and 20 years, making these upkeep costs relatively minimal.

But for young adults who are increasingly living paycheck to paycheck, scraping by just to make ends meet, the upfront cost is a brick wall they can’t get around, regardless of the savings down the road.

“All EVs are so, so expensive—regardless of not having to pay gas down the road it’s still a drawback,” Chelsea Parkes, a 24 year-old resident of Toronto, told The Pointer. 

Currently, the federal government offers two different incentive plans to encourage uptake of electric vehicles. Battery-electric, hydrogen fuel cell and longer-range plug-in hybrid vehicles (with an electric range equal to or greater than 50 kilometres) are eligible for a $5,000 rebate, while shorter-range plug-in hybrids (with an electric range less than 50 kilometres) are eligible for a $2,500 rebate. Five provinces — Quebec, New Brunswick, Nova Scotia, PEI and Newfoundland — all offer some form of EV rebates. But for consumers in Ontario, which has the highest rate of new vehicle registrations of battery electric, plug-in hybrid and hybrid vehicles combined, rebates are a thing of the past. When Premier Doug Ford was elected in 2018, one of his first moves was scrapping Ontario’s electric vehicle incentive program, and last year, he hinted Ontarians should not expect it to come back.

“When electric vehicles first hit, you would see an influx of customer interest and any subsidy or large amount off of the vehicle would essentially put the cost of the vehicle right parallel with gas vehicles,” Victor Grant, assistant sales manager at Chrysler, Dodge, Jeep, Ram on Dundas street in Mississauga, previously told The Pointer. “Now, customers are weighing the differences: pay a little bit more and save on fuel or just get a gas vehicle. Most customers would rather save up front and that’s what we’re finding.”

The roll out of charging infrastructure has been slow, turning some away from the purchase of an electric vehicle.

(Alexis Wright/The Pointer)

But even as more individuals are willing to break the bank for the higher upfront cost of an electric vehicle, many others are concerned about the lack of widespread charging infrastructure needed to sustain a transition to fully electric vehicles. 

Parkes told The Pointer that a couple years ago she purchased a used 2015 electric Kia Soul. Everything about the car was to her liking, except she could only make it 80 kilometres on a full charge, which rapidly decreased in poor weather, or if she used the air conditioning or radio. Even when she replaced the battery — which she was eligible for under the warranty — the maximum distance was still only 170 kilometres. 

Range is something that is improving. While ten years ago, EVs had a maximum distance of 150 to 200 kilometres on a full charge, newer models can travel up to 350 kilometres. The average commuter drives approximately 50 to 100 kilometres across the GTA and beyond during the average workday (with daily commutes taking almost two hours, both ways, on average), so charging the vehicle at home overnight is enough for a typical day. 

What about when you want to make a long distance trip? During the summer months, lots of families pack their cars for a road trip. The drive between Toronto and Montreal, for example, is about 500 kilometres, with at least one charge required along the way. 

With tens of thousands of cars doing the trip on the same day, the bottlenecks are easy to imagine.

After 33,000-plus EVs were bought by Australian consumers in 2022, doubling the number from the previous year, two-hour waits for a charging unit were reported on busy travel days. 

But it was a good news story, the inevitable growing pains of a new clean, green transportation economy—the country’s government quickly gathered data to focus charging investments where they were needed most. 

Currently most rest stops on Canadian highways only have a handful of chargers available. It’s a dilemma for cash strapped municipalities contemplating the construction of new chargers. Mandating this is difficult without proof that sales of EVs are increasing, but consumers are less likely to buy if good charging infrastructure doesn’t exist. Lack of available charging infrastructure was the second highest reason young people cited as a barrier to purchasing an EV, according to The Pointer’s poll. 

Peel municipalities are in the process of amending parking bylaws to advance ZEV requirements in new developments. This means when developers propose new commercial projects with large parking lots, Brampton, Caledon and Mississauga will require a minimum number of electric vehicle charging stations.

Some Canadian cities like Vancouver are taking this requirement to the next level, penalizing those who do not provide the means to charge EVs.

“I think that kind of thing where you have the carrot and stick where the federal government is mandating the sales targets, which will create demand for private investment and charging, but also the stick as well with the financial penalty, and that those sorts of things should be working together,” Nate Wallace, Program Manager of Clean Transportation at Environmental Defence, previously told The Pointer.

In Ontario, the reality is grim. While Ford has stormed ahead with his developer-friendly Bill 23, with the potential to create more sprawl, he has failed to simultaneously introduce a transportation plan aligned with his commitment to build 1.5 new homes by 2031. Charging infrastructure where the rapid growth will occur could mitigate some of the increased emissions generated by longer commutes, but efforts on this front have been minimal. 

As of March the Province reported there were about 1,800 public charging stations in Ontario with more than 5,000 charging ports; 32 Level-2 EV chargers (which provide about 50 kilometres of driving range per hour of charge time, on average, compared to a Level-1 which provides about 6.5 kilometres) were located at public carpool parking lots that offer free charging.

This is still miles away from where Ontario needs to be if consumers are to feel they are part of a large province-wide charging network. The federal government estimates 442,000 to 469,000 public charging ports will be needed by 2035 to support the new EV takeup policy. There is a huge gap.

Across the country, the number of chargers increased 30 percent between the end of 2021 and March 2023. In all, approximately 7,500 gas stations have Level-2 chargers while 1,500 are DC fast chargers. As Level-2 chargers are the most commonly available option for charging on the go, Canadians have to get used to the reality that for every charge required on a trip, it adds about an hour to the duration.

But even with the increase in available chargers, we are still far from matching the widespread accessibility of gasoline being pumped from stations on every major street corner. These stations can service many more consumers per hour than an EV charger. 

Consumers also complain about the continued domination of the electric vehicle market by one company. Tesla broke ground in 2003 and was the first exclusive EV maker in the market. While Teslas still make up approximately 30 percent of EV purchases in Canada, electric models of more modest cars are becoming increasingly popular as the electric vehicle market grows to include a range of automobile classes. Yet, approximately seven percent of all EV chargers available in Canada are part of the Tesla charging network and can only be used by the company's cars. This provides another roadblock for consumers of EVs from other manufacturers.

Some industry experts have criticized Ottawa's new standards as a gateway to aid the uptake of foreign electric vehicles while the domestic market struggles to keep pace with cost and demand. To reach the goal of having all new vehicles sold in Canada be electric in just over ten years, the federal government is providing over $100 million in credits to foreign vehicle makers. In turn, the Canadian market is struggling to provide its own vehicles at costs accessible to consumers. 

“If you don’t care where EVs come from, most will come from China,” Flavio Volpe, President of Canada’s Automotive Parts Manufacturers’ Association, tweeted following the release of the standards. “If you care that Canadian industry, mining, [and] workers should lead in EV production, you won’t be mad if we fix that scheme.”

Natural gas production continues to rise in province’s like Ontario, creating a black mark on a relatively clean electricity grid.

(Alexis Wright/The Pointer)

Another concern for some consumers and environmental groups is the need for clean electricity. According to the Canadian Climate Institute, 84 percent of Canada’s electricity comes from clean sources, far better than the United States which sits around 40 percent. 

While Canada already has one of the cleanest electricity grids, the federal government is stalling when it comes to eliminating fossil fuel energy entirely. During COP28 last month, Canada announced its cap on oil and gas emissions. While it limits the ability of oil and gas companies to pollute, Minister of Natural Resources Johnathon Wilkinson has remained adamant that it is not a cap on production. This means with up and coming technologies like carbon capture and storage, Canada will continue to produce oil and gas in the coming decades, with little proof these technologies trumpeted by producers actually have much impact in reducing pollution. 

In provinces like Ontario, the consequences of moving backward on clean energy are already being felt. When Premier Ford was elected in 2018, he cancelled over 700 contracts for renewable energy production and has instead ramped up the use of natural gas. 

A report from The Atmospheric Fund (TAF) showed that emissions from Ontario’s electricity grid rose 28 percent in 2021 citing an “increasing use of natural gas-powered generating plants, which increase the carbon intensity of the Ontario electricity grid overall.”

According to the Independent Electricity System Operator, which administers Ontario’s market, 34 percent of the province’s electricity supply comes from nuclear; 27 percent from gas; 23 percent from hydro; 13 percent from wind; 1 percent from solar; and less than a percent from biofuels. The slow progress in the green energy sector is a stark contrast to many jurisdictions around the world where wind and solar energy investments have exploded. 

As consumers transition to electric vehicles over the next decade, Ottawa's own energy policies will have to transition in tandem with its new EV standards.

Email: [email protected]

Twitter: @rachelnadia_

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