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Canada’s medium- and heavy-duty transportation sector is looking to transition away from diesel-powered transportation. But mass adoption of zero-emission alternatives won’t happen overnight, due to a range of factors from cost to limited availability of commercial alternatives for certain applications.

What is the role of alternative fuels in Canada’s transportation future? Where are the bottlenecks to adoption of lower-carbon fuels and how can we overcome them? Highlights and video from an Electric Autonomy Canada three-part webinar series examining the issues

Canada’s medium- and heavy-duty transportation sector is looking to transition away from diesel-powered transportation. But mass adoption of zero-emission alternatives won’t happen overnight, due to a range of factors from cost to limited availability of commercial alternatives for certain applications.

In the interim, this means alternative fuels — in the varying states of gas, solids and liquids — will play a key role in lowering emissions to help Canada meet its climate targets. And on this front, there are many tools that need to be used.

This week, Electric Autonomy Canada hosted a three-part discussion series, sponsored by Suncor, Petro-Canada, exploring the alternative fuels landscape in Canada. In all, 11 speakers from different companies and organizations addressed a range of topics that included the release of the Clean Fuel Regulations in Canada, future barriers to alternative fuels adoption and the costs to pull it all off.

You can read a summary of key themes and highlights from all three webinars and view the recordings of the discussions below.

Clean Fuels Regulations signal change in market

In an effort to encourage the adoption of alternative fuels in Canada, the federal government released the final version of the Clean Fuel Regulation (CFR) this past July. Its aim is to incentivize the market to produce and advance alternative fuel technologies, while suppliers are pressured to cut carbon in their products.

“The Clean Fuel Regulations are going to let all kinds of energies compete — whether it’s ethanol, biodiesel, RNG, CNG, hydrogen, electricity, as well as lower-carbon gasoline that incorporates technologies like carbon capture and storage or co-processed renewable feedstocks,” says Bora Plumptre, research director at Electric Mobility Canada.

“I think an important thing to consider in terms of the timeline dynamic for new adoption is that market penetration and domestic demand is going to vary by the type of alternative fuel and, of course, by their relative costs.”

Even though the CFR won’t be put into force until July 2023, its impending arrival is already signalling a shift in the alternative fuels marketplace.

But over time, Plumptre adds, he expects companies will succeed under the CFR and expects that it will, ultimately, result in an increased volume of cleaner alternative fuels on the market.

Revisit the conversation

Alternative Fuels webinar series episode 3: On the road, rails and in the sky
Alternative Fuels webinar series episode 2: Developing the ecosystem to support alternative fuel vehicles
Alternative Fuels webinar series episode 3: Looking into the future, where do we go from here?

Public transit leading in adoption and infrastructure

Although the marketplace for alternative fuels continues to expand, there are still adoption barriers that need to be removed, especially those related to infrastructure.

Ian Thomson, president of Advance Biofuels Canada, explains that the alternative fuel industry often runs into a “chicken and egg” problem of what should come first — building out the infrastructure or accelerating the uptake of these alternative fuel vehicles.

“We’ve run into that in biofuels [where] you have these mandates and then you don’t have enough fuel to fill them, or you build a plant but you don’t have a market because you don’t have a mandate,” says Thomson. “Those are all of the challenges and we need to solve those issues if we’re going to get the alternatives really off the ground.”

One of the areas of transportation that seems to be ahead of the curve in both increasing the adoption of these sorts of vehicles and developing the necessary infrastructure to meet the demand is public transit.

“While we often pay attention to trucking and cars, it’s actually public transit and battery electrification and hydrogen that is going to change the landscape in the next five years and that includes the infrastructure buildup,” says Josipa Petrunic, president and CEO of The Canadian Urban Transit Research & Innovation Consortium (CUTRIC).

“The reason for that is [because] public transit buys in fleet, buys in mass and it’s buying now and there’s absolutely no discussion buying diesel — even if it’s clean diesel.”

Public transit systems are also building out the proper infrastructure that private fleets likely cannot afford.

“Those pieces of infrastructure will not be 100 per cent leveraged and used by transit 24 hours a day. There’s going to be times on those infrastructure pieces…that’s available to rent for trucking, so that is an immediate pathway opportunity.”

Education and cost of ownership

For fleets, the impetus for greater adoption will depend on how attractive the total cost of ownership is to own these vehicles.

“We can have government programs that subsidize a certain amount of initial deployment but broader adoption is going to depend on meeting the economic requirements so that the end users are the ones that are actually financing the transition,” says Ben Nyland, president and CEO, of Loop Energy.

“In many scenarios, hydrogen fuel cell vehicles make a tremendous amount of sense. The operating costs are approaching what you can have with diesel, and the capital cost has some way to go, but that’s not surprising. So we really see those sectors of commercial vehicles and specifically returned to base commercial vehicles like buses, drayage, trucks, logistics vehicles, is where the costs are going to reach parity the fastest.”

There is also a need for increased education to assist fleets with this transition and help them understand the differences between all of these various alternative fuel kinds.

“I think a lot of customers are gaining knowledge in this sector about alternative fuels. But there’s a lot of skepticism around some of the results. There’s really a role to play in sharing of real-world case studies and information and experiences,” says Shannon Wing, senior director of strategy and development at Suncor, Petro-Canada, which is currently offering an alternative drop in fuel called EcoDiesel.

“Organizations that previously considered themselves competitors [are] going to have to band together on this transition and share information more readily than we may have in the past, to have those customers really believe how this transition can work.”

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