LOCATION: National
ISSUE/SOURCE: Incentives for Medium- and Heavy-Duty Zero-Emission Vehicles Program
DATE: May 2025
SUGGESTED RESPONSES
- Transportation serves as the backbone to all trade and economic growth but it is also the second leading source of greenhouse gas emissions, representing about a quarter of Canada’s emissions. Despite only representing about 9% of on-road vehicles, medium and heavy-duty vehicles accounted for 26% of total transport emissions in 2023.
- Zero-emission trucks have the potential to significantly reduce Canada’s greenhouse gas emissions and are a pathway to decouple Canada’s economic growth from its negative environmental impacts.
- In 2022, the Government of Canada invested $547.5 million in the Incentives for Medium and Heavy-Duty Zero-Emission Vehicles Program, which will continue until March 2026, subject to funding availability.
- The Incentives for Medium- and Heavy-Duty Zero-Emission Vehicles Program helps Canadian businesses make the transition to lower emission alternatives by providing point-of-sale incentives of up to $200,000.
- Eligible vehicles available under the program continue to increase as the technology advances. The program now covers many different vehicle types such as shuttle buses, refuse trucks, terminal trucks, highway tractors and delivery vans like the Chevrolet BrightDrop, which is built here in Canada.
- To date, Canadian businesses have submitted over 6,500 incentive requests, worth approximately $128 million, helping to contribute to environmentally responsible economic growth.
- As Canada moves forward with the Build Canada agenda, efforts to decarbonize the medium and heavy duty vehicle sector will be critical to limiting negative impacts on our environment and climate.
IF PRESSED
On the federal income tax write-off for businesses
- The government of Canada has also been supporting zero-emission vehicles use by offering businesses a temporary first-year tax write-off for new and used light-, medium- and heavy-duty vehicles.
On medium- and heavy-duty zero-emission vehicle sales regulations
- Regulations with respect to emissions from vehicles and zero-emission vehicle sales requirements fall under the purview of Environment and Climate Change Canada. Environment and Climate Change Canada is undertaking analysis on the impact of the final rules announced in the United States in March 2024.
On availability of medium- and heavy-duty zero-emission vehicle infrastructure
- The Government of Canada recognizes the importance of deploying charging and hydrogen refuelling stations to increase business confidence in medium- and heavy-duty zero-emission vehicles.
- To-date, federal infrastructure investments have mostly focused on light-duty vehicles, but as technologies for medium- and heavy-duty zero-emission vehicles advance, more dedicated efforts to support the deployment of medium- and heavy-duty zero-emission vehicle charging and refuelling infrastructure are anticipated.
BACKGROUND INFORMATION
- Since its launch on July 11, 2022, over 6,500 incentives have been requested through the Incentives for Medium- and Heavy-Duty Zero-Emission Vehicles Program, worth approximately $128 million. Initial estimates suggested that the program will help fund approximately 20,000 vehicles over 4 years and is expected to result in annual greenhouse gas reductions of up to 0.2 million tonnes per year by 2026.
- In 2023, medium- and heavy-duty vehicle emissions account for approximately 26% of Canada’s transportation-related greenhouse gas emissions, and 6% of the country’s total emissions.
- As of December 2024, there were 2.6 million medium and heavy-duty trucks in operation in Canada (0.26% of which are zero-emission, or about 6,700 vehicles).
- In October 2024, the Government of Canada introduced a 100% surtax on all Chinese-made electric vehicles to protect Canada’s electric vehicle sector. To align Canada’s electric vehicle measures, Transport Canada’s electric vehicle incentive programs implemented amendments barring any electric vehicles made in countries with which Canada does not have a free trade agreement with from being eligible to receive incentives.
- Currently, British Columbia, Yukon and Nova-Scotia are also offering purchase incentives that can be combined with the Incentives for Zero-Emission Medium- and Heavy-Duty Vehicles Program to make the transition even more affordable.
- Quebec’s incentive program, which offered up to $175,000 was paused in September 2024 due to a surge in demand over the summer months. The program’s relaunch is expected in 2025.