Draft federal plan for clean fuel credit system omits 80 per cent of EV charging, carmakers and owners say
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Aug 27, 2020
Kerry Banks

The exclusion in the Clean Fuel Standard means only “network charging” and relatively cleaner liquid fuel services will benefit from credits, missing an opportunity for rebates to invest in EV education and charging infrastructure, critics claim

The exclusion in the Clean Fuel Standard means only “network charging” and relatively cleaner liquid fuel services will benefit from credits, missing an opportunity for rebates to invest in EV education and charging infrastructure, critics claim

The federal government recently released an updated draft of the Clean Fuel Standard (CFS), which aims to achieve 30 million tonnes of annual reductions in greenhouse gas emissions by 2030. With the plan set for implementation in the fall, stakeholders across the industry had been eagerly anticipating the draft — but the removal of a few key provisions has sparked concern among some market participants.

The most contentious change is that electric vehicle charging that is not done on chargers tied to a network will no longer qualify for credits — the tradeable, sellable environmental commodities that underpin the CFS system.

“More than 80 per cent of the electricity delivered to electric vehicles in Canada comes from charging stations that are not connected to a network,” says Kelsey Lane, co-chair of the government relations committee for the Electric Vehicle Society, a not-for-profit organization that represents electric vehicle owners and enthusiasts across Canada.

Non-network charging includes the majority of charging sessions at home, in residential buildings or on the street.

Valuable credits lost

That’s not the only revision seen diminishing the CFS’s potential to boost EV adoption.

Last year’s version of the CFS also included a provision that allowed credits to be used towards education and public awareness campaigns — but it has been removed. “[Along with] dropping non-network charging from the CFS the government is removing education and outreach as eligible activities for revenue recycling,” says Lane.

The EV Society is not alone in opposing the changes.

David Adams, president and CEO of Global Automakers of Canada, the association representing most major carmakers other than those based in the U.S., notes, “We don’t like the fact that home charging has been dropped because we understood that we could receive some of the credits connected with home charging.”

EV owner groups, industry association Electric Mobility Canada, the Clean Energy Canada think tank and at least one charging network operator also support non-network home-charging’s inclusion in the CFS.

“We strongly support the inclusion of all types of credits in the CFS,” says Travis Allan, vice-president of public affairs at national charging network operator FLO. “We want to create as many credits as possible to benefit the industry.”

Other concerns

The government began work on the CFS in 2016, and the process of establishing regulations had been advancing steadily until the onset of COVID-19. That prompted the government to postpone the target to complete the regulations from last spring until the fall, followed by a move to relax initial emission reduction targets for fuel producers. But those were changes in timing, not substance.

The EV Society cites two other problem areas in the latest draft. Overall, it believes that the CFS as written will result in unequal distribution of investment across Canada, favouring urban centres while offering little or no support for some Prairie, Atlantic and rural sectors of the country.

The group is also puzzled by the phasing out of credits for network charging in 2027, three years before the government’s zero-emission vehicle sales target for 30 per cent ZEV adoption by 2030. “We believe that this phase-out will reduce the amount of revenue available to reinvest in activities that reduce barriers to EV adoption,” says Lane.

In a letter to Environment and Climate Change Canada, Daniel Breton, CEO of Electric Mobility Canada voices similar concerns, stating that EMC “recommends broadening the scope of reinvestment to include other activities (e.g. consumer education, investments in the grid that support EV adoption). This will allow for the value of credit revenue reinvestments to be maximized and ensure that the CFS supports the growth of e-mobility in Canada.”

Late last week, the EV Society sent a letter to Jonathan Wilkinson, Minister of Environment and Climate Change, requesting a meeting to discuss its concerns and to urge the government to reverse its decision and include non-network charging in the plan. It has also created an information page on its website recapping the changes with a link that readers can use to submit their own letter to the minister.

Timing urgent

There is significant urgency to the request as the current proposals will be entered in the Canada Gazette Part I in five weeks. After that, there’s a 75-day consultation period when changes will be considered before it goes to parliament in Canada Gazette Part II. However, if changes are not made before CG1, they are unlikely to happen at a later stage in the process.

Why the government changed its plan to include non-network charging in the CFS credit system has not been officially explained. According to Allan at FLO, “We understand that it creates some technical and administrative challenges. It’s harder to figure out a method to calculate credits with non-network charging.”

However, David Adams says any such challenges can be easily addressed. “It’s not complicated if the vehicle has the capacity to monitor it. Most of the new model EVs can do this.”

Matt Stevens, vice-president of electric vehicles at Geotab, an Oakville, Ont.-based analytics company that monitors and tracks EV usage, agrees that vehicle telematics make measurement and administration “easy.” Vehicles without telematics could be networked by adding a small device to provide connectivity, he says, but this will be essentially a non-issue with new EVs going forward.

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