Location: National
Key Messages:
- The Government of Canada is committed to support a greener Canada.
- Canada is committed to meeting a mandatory target for all new light-duty cars and passenger trucks sales to be zero-emission by 2035, accelerating it’s previous aspirational goal of 100 percent sales by 2040.
- Putting more zero-emission vehicles on the road is a key step in Canada’s pathway to a cleaner transportation system. The growing demand for zero-emission vehicles in Canada demonstrates that consumers are committed to doing their part to reduce pollution from the transportation sector.
- The federal Incentives for Zero-Emission Vehicles (iZEV) Program contributes to a clean transportation system. Increasing the adoption of zero-emission vehicles in Canada through purchase/lease incentives (up to $5,000 per vehicle) helps to reduce air pollution and greenhouse gas emissions from the transportation sector.
- Many provinces and territories are also offering consumer purchase incentives that can be combined with the zero-emission vehicle incentives to make zero-emission vehicles even more affordable.
- Since its launch in May 2019, Canadians and Canadian businesses have benefitted from the Program, with over 230,000 incentive claims having been submitted to Transport Canada.
- To date, the Government of Canada has invested $2.3 billion in the Incentives for Zero-Emission Vehicles (iZEV) Program, which will continue until March 2025 (or until available funding is exhausted).
Summary of Issue / Background:
- In Canada, transportation accounts for about a quarter of our greenhouse gas emissions. The Government of Canada has an ambitious target of 100 percent zero-emission vehicle sales by 2035, coupled with a suite of support measures from purchase/lease incentives to charging infrastructure.
- Light-duty vehicle emissions account for approximately 50% of Canada's transportation-related greenhouse gas emissions, and 12% of the country's total emissions. Decarbonizing these vehicles is critical to reducing overall emissions in Canada.
- Zero-emission vehicles are vehicles that can operate without producing tailpipe emissions, such as battery-electric, plug-in hybrid electric, and hydrogen fuel cell vehicles.
- In order to encourage the adoption of zero-emission vehicles by Canadians and Canadian businesses, the Government of Canada launched the Incentives for Zero-Emission Vehicles (iZEV) Program in May 2019.
- Through Budget 2022, the Government of Canada invested more than $2.6 billion in measures to support accelerating the light-duty zero emissions vehicle adoption, including $900 million to build zero-emission vehicles charging infrastructure, and $1.7 billion to expand the types of vehicle models eligible under the Program to include larger vehicles (such as vans, sports utility vehicles, pick-up trucks).
- In April 2022, the iZEV Program’s manufacturer’s suggested retail price caps were increased to accommodate more vehicles. To be eligible:
- Base model passenger cars must have a manufacturer’s suggested retail price under $55,000, with higher trims eligible up to a maximum of $65,000.
- Station wagons, pickup trucks, sports utility vehicles, vans, and special purpose vehicles must have a base model manufacturer’s suggested retail price under $60,000, with higher trims eligibility up to a maximum of $70,000.
- The Incentives for Medium- and Heavy-Duty Zero-Emission Vehicles (iMHZEV) Program started in July 2022, offering Canadian organizations (for profit and non-profit), provinces, territories, and municipalities incentives towards the purchase/lease of eligible vehicles.
- Budget 2022 provided the iMHZEV program $547.5 million until March 2026 as it strives to reach 35% of total new medium- and heavy-duty vehicle sales being zero-emission vehicles by 2030.
- The Government of Canada also recognizes the importance of deploying charging and hydrogen refueling stations to increase consumer and business confidence in zero-emission vehicles.
- Since 2016, over $1.2 billion has been invested to deploy charging infrastructure from coast to coast to coast, with the goal of supporting at least 84,500 new chargers across Canada.