Canada’s drive for zero-emission trucks will hinge on financial support

There is no shortage of pledges to reduce vehicle emissions these days.

Corporations are enshrining targets in Environmental, Social and Governance (ESG) statements. Governments are signaling tougher standards for future internal combustion engines. And cities around the world are establishing dates when they don’t want diesel engines to come ‘round here no more. (With apologies to the late, great, Tom Petty.)

Canada’s federal government is now building on such pledges with a series of specific sales targets and other measures included in a newly released 2030 Emissions Reduction Plan.

While much of the attention has focused on targets for light-duty vehicles, limiting all new sales to zero-emission models after 2035, the plan also includes targets for heavier trucks. More than one-third (35%) of medium- and heavy-duty vehicles sold in Canada will need to be zero-emission designs by 2030. Where feasible, entire subsets of vehicles will need to be zero-emission models by 2040.

They’re remarkably aggressive targets given that such products are only now finding permanent positions on established and emerging assembly lines. The units on Canadian roads are still rare enough that they warrant formal announcements and press releases.

The underlying technology is proving its worth, though. In the worlds of local and regional hauls, early battery-electric equipment appears to be delivering the all-important range needed between charges. Fuel cells are showing promise for heavier equipment that needs to travel longer ranges or warrants extra flexibility. Energy densities continue to improve in lithium-ion battery packs, and advances in solid state batteries might take us further yet.

We’ve come far enough that a growing list of fleets are anxious to kick the tires on zero-emission vehicles to see where the equipment will fit into existing operations, and discover where they might still fall short.

But a key barrier to this next step comes in the form of costs. As promising as the total cost of ownership appears — thanks to things like a battery-electric truck’s lack of combustion-related parts — early investors face some undeniable sticker shock when it comes to initial purchase prices.

Aside from the trucks themselves, such businesses need to plan for changes to everything from charging infrastructure to maintenance. There are plenty of lessons to learn and costs to be absorbed.

This is where another key aspect of Canada’s announcement comes into play.

While further details will emerge in the coming federal budget, there are promises of more than $780 million in related financial incentives that could apply to trucking. These include $547.5 million in purchase incentives for medium- and heavy-duty zero-emission vehicles; another $199.6 million to retrofit large trucks on the road; and $33.8 million for projects that demonstrate hydrogen-electric trucks.

Early adoption hinges on such financial support. Look no further than projects linked to incentives offered in jurisdictions such as B.C. and Quebec, not to mention California.

The support goes beyond individual vehicles, too.

Lion Electric’s coming battery-pack assembly plant in Saint-Jerome, Que., will be supported by $100 million from the federal and provincial governments. Meanwhile, LG energy and Stellantis – maker of the Ram ProMaster van – announced in March that their joint venture will establish a $5 billion electric vehicle battery plant in Windsor, Ont. Provincial and federal governments are reportedly investing hundreds of millions of dollars into that.

There is a path to zero emissions, but it will need to be paved, and governments at every level need to recognize that such roadwork comes at a price.