Incentives For Medium- and Heavy-Duty Zero-Emission Vehicles Program
Location: National
Issue/Source: Incentives for Medium- and Heavy-Duty Zero-Emission Vehicles Program / TRAN
Date: March 2024
Suggested Responses
- In Canada, transportation accounts for about a quarter of our greenhouse gas emissions, of which 27% (or 41 megatonnes) was attributed to the use of medium- and heavy-duty vehicles in 2021.
- To meaningfully reduce emissions in this sector, the Government of Canada has set an ambitious target of reaching 100% medium- and heavy-duty zero-emission vehicle sales by 2040 (for a subset of vehicle types based on feasibility), coupled with a suite of support measures from purchase incentives to safety research and more.
- Zero-emission vehicles have the potential to significantly reduce Canada’s greenhouse gas emissions and support Canada’s transition to a low-carbon transportation system.
- The federal Incentives for Medium- and Heavy-Duty Zero-Emission Vehicles Program provides point-of-sale incentives of up to $200,000 for the purchase or lease of eligible medium- and heavy-duty zero emission vehicles. Since the launch of the program in July 2022, Canadian businesses have submitted over 1,600 incentives requests (worth approximately $51.3 million).
- To date, the Government of Canada has 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).
- Since the launch of the Program, the number of eligible vehicle models continues to increase, covering various vehicle types across medium and heavy-duty segments, such as zero-emission delivery vans, shuttle buses, ambulances, refuse trucks, terminal trucks, tractors, fire trucks, and more.
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:
- The Government of Canada is introducing regulated sales targets to require 100% of medium- and heavy-duty vehicle sales to be zero emission by 2040 for a subset of vehicle types based on feasibility, with interim 2030 or earlier regulated sales requirements that would vary for different vehicle categories based on feasibility.
- These regulations are led by Environment and Climate Change Canada and proposed requirements are planned to be published in 2024.
- The medium- and heavy-duty zero emission vehicle market is still in its early stages relative to the light-duty market, but demand for medium- and heavy-duty zero emission vehicles is increasing.
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 1600 incentives have been requested through the Incentives for Medium- and Heavy-Duty Zero-Emission Vehicles Program, worth approximately $51.3 million. Initial estimates suggest 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.
- Medium- and heavy-duty vehicle emissions account for approximately 27% of Canada’s transportation-related greenhouse gas emissions, and 6% of the country’s total emissions.
- Currently, Quebec and British Columbia 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.