Transport minister mulls expanding EV rebate program to include larger, pricier models
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Dec 15, 2021
Mehanaz Yakub

With new electric SUVs and pickup trucks hitting the market next year, minister Omar Alghabra says the Liberal government could be looking to make more expensive EVs eligible for the federal rebates

While keeping the Canadian consumer in mind, the Federal government is revisiting the requirements to qualify for an EV rebate.

With new electric SUVs and pickup trucks hitting the market next year, minister Omar Alghabra says the Liberal government could be looking to make more expensive EVs eligible for the federal rebates

The federal government’s electric vehicles (EV) rebate program is considering a significant overhaul that would make pricier electric SUVs and pickup trucks eligible for a rebate.

The news was first reported by The Canadian Press, after receiving a written statement from the transport minister, Omar Alghabra’s, office.

“The vast majority of vehicles purchased today are SUVs and pickup trucks, and while (zero-emission vehicle) options are becoming available for these segments, many of these will be priced out of the current iZEV program,” read the statement as reported by CP.

An email statement provided to Electric Autonomy Canada from Alghabra’s office said that “ZEV demand in Canada remains strong, and our government is encouraged that we are on track to set a new ZEV sales high in 2021, despite all the downward pressures caused by the pandemic and supply chain risks.”

Transport Canada announced in June that it was considering additional mandatory measures that would help accelerate ZEV sales in Canada and improve supply over the longer term. This was reiterated during last month’s Speech from the Throne. The government, recently announced the launch of a consultation process that will look into “how we should go about delivering on the commitment,” says Alghabra’s office.

Today’s rebate program

Under the current Incentive for Zero-Emission Vehicles (iZEV) program, only vehicles with a base price of under $45,000 (or models under $55,000 with seven or more seats), can qualify for up to $5,000 off the purchase price of a new EV, through the federal rebate program.

This means that many of the EVs coming to Canada next year, such as the Volvo C40 Recharge SUV crossover and the Ford F-150 Lightning electric pickup, with higher price tags of $72,600 and $58,000, respectively, will miss out on federal rebates. Recently the Tesla Model 3 (the 2021 and 2022 years) became ineligible for the iZEV program after a price increase, despite it being a year-over-year top-selling EV in the country.

Alghabra says the government’s iZEV program needs to be “revised to better align” with the types of vehicles Canadians are interested in buying, which, increasingly, is EVs and especially those of the larger variety. Zero-emission passenger vehicles make up the majority of new EV registrations, nationally. So far, there are only four SUV models available in Canada.

Liberals election promises

First launched in 2019, the iZEV program has been successful at providing more than 100,000 Canadians with incentives to purchase a zero-emission vehicle. The government initially allocated $300 million to the iZEV program and subsequently topped it off with an additional $287 million in funding last year.

Transport Canada estimates that those already participating in the program are reducing up to 352,000 tonnes of greenhouse gases emissions per year.

In tandem with moving up the 100 per cent zero-emission new car and light-truck new sales targets to 2035, the Liberal’s promised during this Fall’s federal election campaign, to add $1.5 billion more to the iZEV rebate program over the next four years.

“Transportation is the second-largest source of greenhouse gas emissions in Canada and the iZEV program is one way to reduce emissions on the road. By making zero-emission vehicles more affordable, and by putting more of them on the road, we help to reduce pollution in our cities and towns, while protecting the planet for future generations,” reads the statement from Alghabra’s office.

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