Ottawa Moves to Permanently Scrap Federal EV Sales Mandate

An electric car at a Canadian Tire charging station in Scarborough, Ont., on June 14, 2023. The Canadian Press/Doug Ives

The federal government has moved to formally repeal the controversial electric vehicle (EV) sales mandate, but it has not yet finalized the more stringent emission standards that will replace the policy.

The Liberal government said in an Aug. 15 Regulatory Impact Analysis Statement that it will repeal the mandate, implemented in 2023, that set a target for 20 percent of all vehicle sales in 2026 to be EVs. That target was set to increase to 100 percent by 2035.

Ottawa announced in September that it was pausing the 2026 mandate and launching a 60-day review of the program. In February, Ottawa outlined a revised goal to reach an EV adoption rate of 75 percent by 2035 and 90 percent by 2040, which would be achieved through stricter greenhouse gas emission standards for vehicle purchases starting in 2027.

The federal government’s decision to scrap the EV sales mandate came following pressure to do so from the auto industry and several provinces, who argued that the strictness of the mandate made it unrealistic and costly to implement.

The September announcement also came as the United States imposed 25 percent tariffs on Canadian vehicles and automotive parts, and U.S. President Donald Trump signed resolutions blocking an EV mandate in California and 17 other states.

Environment Minister Julie Dabrusin’s press secretary said in an email on Aug. 17 that Ottawa plans to launch a national charging infrastructure strategy in the coming months, and is also launching consultations with the automotive industry and environmental groups.

The Regulatory Impact Analysis Statement said that the savings from the repeal of the mandate were “estimated to be $57.6 billion from 2026 to 2050,” or the equivalent of $2.3 billion annually. The report said fewer EVs would be purchased, and consumers would no longer need to “bear the higher upfront cost” of EVs and at-home charging units.

“Conversely, these same consumers would forgo fuel and vehicle maintenance savings that accrue from electric vehicle ownership,” the report said, noting that fuel savings are estimated at $53.8 billion over the same period.

However, the report said ending the EV mandate would slow the rate of adoption of EVs, and could cause $90.3 billion in “potential climate change-induced global damages.”

Alberta Premier Danielle Smith called the end of the EV mandate a “clear victory for Albertans,” and that Ottawa was getting rid of it “thanks in large part to our government’s advocacy.” Smith also commended the federal Conservative Party for the “work they did advocating for the removal of these policies.”