Canada needs to move aggressively to divert the transportation sector from fossil fuels and get people out of cars while taking full advantage of the economic opportunities available in transition.

In an online roundtable meeting Wednesday, a group of policy experts urged the federal government to make a 10-year, billions of dollars effort to electrify the transportation sector as part of efforts to achieve zero net greenhouse gas emissions.

Transportation – including passenger vehicles, commercial trucks, planes and trains – accounts for 25% of Canadian emissions. Emissions from this sector have grown by 53% since 1990.

“We have to deal with this sector if you are going to reach the net-zero target,” moderator Diana Fox Carney said in a session hosted by Knight Company magazine as part of the seven-part Building Back Better event series. “Canada may lag behind several other countries in this regard,” with lower penetration of electric vehicles, lack of EV making and lack of forward thinking on mass transit, he said.

Other analysts, including the International Energy Agency, have noted that Canada’s passenger fleet has one of the worst fuel efficiency ratings because of lower gasoline prices, long distance and preferences for gasoline-consuming SUVs and pickups.

The federal government has promised to pursue a net zero emission target by 2050 – a target that requires massive efforts to virtually eliminate the use of fossil fuels in industrial, transportation and heating buildings. (Any remaining emissions from sustainable use of fossil fuels will be balanced through natural means and technology to remove carbon from the atmosphere.)

To increase progress towards the net-zero target, Knight Company is encouraging the Liberal government to launch a massive clean energy stimulus program because it looks like it will revive an economy that has been devastated by the COVID-19 pandemic.

Some environmental organizations also echoed advice from the International Energy Agency that governments should focus stimulus spending on clean energy initiatives to accelerate the transition to a low carbon economy.

The government needs to introduce policies that expand the demand and supply of electric cars, but also electric and hydrogen-powered transport vehicles, which make up 42% of transportation emissions, said Carolyn Kim, Ontario’s regional director for the Builder Institute.

The table setting white paper prepared by Ralph Torrie from Torrie Smith Associations and CĂ©line Bak from Analytica Advisors said that a $ 24 billion net transportation investment over 10 years would save the driver $ 57 billion in gas stations while generating the equivalent of 17,700 full-time work a year and cutting greenhouse gas emissions by 96 million tons during this decade.

Included in the proposal is a one-year, $ 6-billion plan to provide free transit passengers. This program will encourage commuters to return to mass transit after the practice of social cessation ends. It will also target poorer Canadians who depend on the public system.

“With COVID-19, there is a risk that people who have used transit will return to the car,” Bak said in an email after the webinar. Ensuring these systems “ensures that public transport authorities are not weakened by COVID-19 and that the GHG impact of COVID-19 is minimized while putting money directly into many people’s pockets,” he added.

The plan also proposes to “shake up” the Trans-Canada Highway with a network of fast charging stations that can recharge vehicle batteries in five minutes. And it urges Ottawa to help finance the purchase of electric vehicles, especially for fleet owners who currently face higher financing costs for EVs than they do for traditional gas or diesel-fueled vehicles.

While there are incentives and policies designed to encourage people to buy EVs, the government must also act to ensure Canada seizes the opportunities that arise from the transition, said Amarjeet Sohi, a former Liberal cabinet minister. That includes areas such as supplying metals and minerals needed for batteries and cables, expanding the country’s current presence in the manufacture of low-carbon trucks and buses, and attracting investment from the global automotive sector for new electricity models and their parts.

The decision on where to place the EV assembly plant is being made outside Canada, and that puts the country at a disadvantage, said Jerry Dias, president of the union union. Unifor represents thousands of manufacturing workers, mainly in the automotive industry based in Southern Ontario.

As global car manufacturers expand their EV and hybrid offerings, only a handful of these models are destined for Canadian factories, Dias noted. Parts manufacturers are at risk because EVs have far fewer components – no transmission, radiator or exhaust system. “We need to move and we need to move quickly” to the industrial strategy, Dias said. “I am afraid we are slow in entering the game and we have many reasons to make up.”

Marcelo Lu, president of BASF Canada, said the country was ready to participate in the economic opportunities that would come with the transition.

“I believe Canada is ready to contribute because it has the resources,” Lu said. However, he added the government might have to share the costs of developing these resources to “reduce scale.”

One area where Canada has carved a niche is the development of electric buses, run on plug-in batteries or hydrogen fuel cells that power electric engines.

Investment in charging infrastructure will support the further expansion of buses, trucks and battery-powered trains and hydrogen, said Josipa Petrunic, president of the Urban Transit Urban Research and Innovation Consortium.

Shawn McCarthy writes about sustainable finance and climate for Corporate Knights. He is also a senior advisor to the Sussex Strategy Group.


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