Environment Committee on Nov. 2nd, 2020

[Joanna Kyriazis]

Of course, automakers tend to prioritize markets that have policies in place requiring the sale of cleaner vehicles and zero-emission vehicles, and so we know that automakers globally are pouring hundreds of billions of dollars into the development of EVs and rolling out new models every year. Again, in looking to the EU as an example, just in the first quarter of 2020 we saw automakers introduce 42 new electric vehicle models. That's more than all of the EV models available in Canada.

The way we can address the supply issue is to move forward with a phased-in zero-emission vehicle standard and other supply-side policies that help automakers decide to make the EVs they are producing here in Canada available to Canadians, including those outside British Columbia and Quebec. Once Canadians have more choice of which EV makes and models are available, and once they see options at various price points, that's going to help electric vehicle uptake.

[Laurel Collins, NDP, Victoria, BC]

Great. On this idea of price points, what's Clean Energy Canada's position on the idea of providing incentives to purchase used EVs?

[Joanna Kyriazis]

Clean Energy Canada supports this.

In terms of making sure that the iZEV program and the incentive money is best used and reaching a broad range of Canadians, opening up this incentive program to used vehicles is going to get at the majority of Canadians. That's what lower- and middle-income Canadians can afford.

I, for one, can't afford a new vehicle, but that doesn't mean I don't want to go electric. To use our government and taxpayer dollars most prudently and reach the most price-sensitive consumers, for whom those extra few thousand dollars can make the difference in their decision between an ICE vehicle or an EV, pursuing a used vehicle incentive is an effective approach.

[The Chair, Liberal, Yasmin Ratansi]

Thank you very much.

We now go to the second round of questions.

For five minutes, Mr. Albas, you're up.

[Dan Albas, Conservative, Central Okanagan—Similkameen—Nicola, BC]

Thank you, Madam Chair.

Obviously, we just heard that supply is a major issue here in Canada. I've seen data from the European Union that says electric registrations have now surpassed diesel ones.

I'd like to ask Ms. Kyriazis, do you have anything to explain this, or do you go back to some of the arguments you just gave to Ms. Collins?

[Joanna Kyriazis]

I would just reiterate that the fact that they're moving forward with supply-side policies is very important. We're seeing automakers in Europe.... Honda just last week announced that it would sell only zero-emission vehicles in Europe by 2022. These are fast timelines, and automakers are responding to incentives and regulatory moves in these markets.

[Dan Albas, Conservative, Central Okanagan—Similkameen—Nicola, BC]

Thank you for that.

I'd like to ask Mr. Kingston, now that he has joined us again, what needs to be done in his industry, beyond just subsidies. They are obviously stoking demand, but how do we get more supply of products to Canadians?

[Brian Kingston]

I offer my apologies for the Internet issues.

With respect to supply, I have good news. When you look at what my three members are doing by way of investing—and this is outlined in the brief—there are literally dozens of new models coming online in the next few years.

In fact, concerning global supply, according to a recent Deloitte study, by 2030, the capacity to build EVs is going to outstrip demand by 14 million units because there are so many new players entering this market, plus the traditional OEMs who are investing billions. I'm confident that supply is not an issue. The key is how we stoke demand.

[Dan Albas, Conservative, Central Okanagan—Similkameen—Nicola, BC]

To me, having more units coming online could also drop price, so I guess it's a technology issue. But why is the Canadian market not seen as a priority for new EV supply? Yes, you can quote that world stats are going up, but it seems that Canadians are waiting much longer than our counterparts in other parts of the world.

[Brian Kingston]

I would disagree with the analysis that was provided to Transport Canada on supply. When you look at supply of EVs across Canada, it's quite consistent with that of other vehicles that sell in those volumes. If you look at sales since 2015, they've been increasing on average by around 75% to 80%. If supply were such an issue, you wouldn't see sales increasing like that. If a Canadian wants to purchase one of these vehicles, they are available.

[Dan Albas, Conservative, Central Okanagan—Similkameen—Nicola, BC]

With all due respect, Mr. Kingston, when I chat with people, I find that some are waiting six weeks or six months and are told they have to put a deposit down and will eventually get a car.

But there's a difference. When you have a family and are making a big investment decision, usually you want to test out a car. That possibility has not been available unless someone is willing to put money down. I recognize that there is some supply coming, but I also would simply say that it seems to me Canadian markets are being underserved by various product offerings.

I would like to ask the Canadian Electricity Association a question.

Mr. Bradley, you've raised a very interesting point. I've always wondered about the B.C. Utilities Commission's process. Their mandate is, if I have this correct—Ms. May can correct me later—“affordable power for generations”. They will literally not hold hearings to create new infrastructure unless there is sufficient demand for it. Usually, that is what has already been lagging. These projects take a long time to develop.

What aspects of those utilities commissions' processes need to be changed? Quite honestly, if you have to be hitting that load target in order to even open up a hearing to have a conversation about building new infrastructure to serve it, it seems to me that the system lags behind the market.

[Francis Bradley]

It's an interesting question. Thank you very much for it.

[The Chair, Liberal, Yasmin Ratansi]

You have 40 seconds.

[Francis Bradley]

Okay.

I can't comment specifically about the particular cases within B.C. and at the BCUC, but generally with respect to electricity generation, much as I was saying with respect to metering, we have a regulatory system and a regulatory compact that was developed for the industry as it was in the 1960s rather than in 2020. The systems are not flexible, they're not built for innovation, and they're not built to meet the challenges of the future writ large.

Then, with respect to your earlier question about the challenges with getting to test vehicles, we have been partnering with an organization called Plug'n Drive—

[The Chair, Liberal, Yasmin Ratansi]

I am so sorry, but you'll answer him later. He has another turn coming up.

We now go to Mr. Longfield for five minutes.

[Lloyd Longfield, Liberal, Guelph, ON]

Thank you, Madam Chair.

I'd like to follow up with Ms. Kyriazis. On that article last week, which I also read with great interest, about how Honda in the U.K. phasing out diesel vehicles in favour of EVs three years ahead of schedule, I'm wondering whether that was due to the regulations on clean fuels. Were there incentives in place in the U.K. or the EU that bumped up volumes? Was there a combination? What's behind that change?

[Joanna Kyriazis]

There is a myriad of policies being introduced, as well as investments in various countries in the EU. In part as a response to the coronavirus pandemic, we are seeing countries expand their purchase incentives, investing hundreds of millions of dollars in EV charging networks—

[Lloyd Longfield, Liberal, Guelph, ON]

Excuse me, is that companies or countries?

[Joanna Kyriazis]

Countries.

We're also seeing auto industrial policies and investments as well. Just today, I read that Germany is close to agreeing to a $2 billion package for its auto industry to help it build and prepare for cleaner vehicles and to train staff. France as well, as part of its package, is helping to invest in its auto industry. It wants to become one of the top producers of zero-emission vehicles in the world.

Again, we're seeing policies that focus on the demand and supply sides, and also that help to support these auto companies to capture a piece of the growing global EV market. Canada needs to do the same.

[Lloyd Longfield, Liberal, Guelph, ON]

Thank you.

Madame Pauzé also mentioned this. When the Ontario government removed their incentive, the dealers in Guelph said to me that it was like turning off a light switch. Immediately, they went from 4% demand to less than 1% demand. The federal government came in and there's been some increase, but there needs to be participation by all levels of government. Would you agree with that?

[Joanna Kyriazis]

Yes. Certainly, the steps that provincial governments have taken have been very effective. We support continued action at the provincial level, but at this point, we have an uneven electric vehicle market in Canada and there needs to be some action at the federal level to help address that.

[Lloyd Longfield, Liberal, Guelph, ON]

Great. Thank you.

Mr. Kingston, welcome back. Technology isn't our friend all of the time. I'm interested in other incentives to drive demand. In British Columbia there's a scrappage program. There could be scrappage programs in other provinces. They're very narrowly focused. Could you comment on how we could try to get the older vehicles off the road, because we know that newer vehicles have better emissions standards and could go a long way towards climate change reductions.

[Brian Kingston]

Yes, scrappage programs are critically important. The reason is that only 6% to 7% of vehicles on the road in a year are new. In fact, 35% are 12 years or older with higher GHG emissions. While it's great to focus on ZEV adoptions through things like incentives, ZEVs right now are only 3.2% of new vehicle purchases, amounting to 0.2% of the total fleet. If the government wants to have an impact on fleet-wide emissions, the only way to do that is to put in place a scrappage program that actually makes the overall fleet of millions of vehicles more efficient. That can include both ZEVs and ICE vehicles.

[Lloyd Longfield, Liberal, Guelph, ON]

A push-pull approach could be a combination of incentives on ZEVs, as well as an incentive to get vehicles off the road.

[Brian Kingston]

Exactly.