Incentives for Medium- and Heavy-Duty Zero-Emission Vehicles ProgramPembina Institute comments and recommendations

Publication - May 16, 2022 - By Carolyn Kim

The Pembina Institute welcomes the opportunity to provide input on the design of Transport Canada’s new incentive program for medium- and heavy-duty zero-emission vehicles (iMHZEV). This new, four-year, $547.5 million purchase incentive program is a critical component to help businesses and municipalities make the switch from internal combustion engine vehicles to zero-emission vehicles. Our comments include insights from our Urban Delivery Solutions Initiative, a national network of businesses and organizations working to reduce freight emissions in Canadian cities.

MHDVs are a significant contributor to Canada’s greenhouse gas emissions. Freight trucks currently account for nearly 35% of Canada’s transport sector emissions, and nearly 10% of Canada’s overall emissions. This share has grown since 1990, when these figures were at 16% and 3% respectively.

Financial incentives are crucial in reducing one of the main barriers to electric vehicle adoption: high upfront purchase prices. We are pleased to support the proposed Transport Canada incentive program as we believe this measure — along with other complementary zero-emission MHDV demand- and supply-side programs and policies, including support for charging infrastructure — will help bridge the gap and kickstart Canada’s adoption of 35% of medium- and heavy duty vehicle sales to be zero-emission by 2030.

Recommendation summary

  • Offer information on the program as soon as possible
  • Ensure the eligible vehicle list is flexible to changes in the market, and operates on a rolling basis
  • Allow non-Canadian OEMs and vendors to distribute Canadian voucher incentives to Canadian companies
  • Ensure incentives cover at least 50% of the incremental cost
  • Include lighter cargo vans in the class 2b category
  • Ensure transparency and clarity at all stages of the program, especially regarding the remaining yearly funds
  • Earmark a portion of the funding for small trucking fleets and organizations that operate in or serve under-resourced communities
  • Allow incentives to be stacked with provincial and territorial incentives, where available
  • Initiate extensive, multi-lingual outreach campaigns to fleets as well as vendors and manufacturers in and outside of Canada
  • Enhance data collection and reporting

Subscribe

Our perspectives to your inbox.

The Pembina Institute endeavors to maintain your privacy and protect the confidentiality of any personal information that you may give us. We do not sell, share, rent or otherwise disseminate personal information. Read our full privacy policy.