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goldstein: subsidizing evs isn’t about saving the environment
electric vehicles were developed to save the auto sector not the planet
jul 27 2024
3 minute read
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with floods and wildfires overwhelming municipal infrastructure across canada these days, is it really a good idea for federal and provincial governments to have earmarked over $52 billion to subsidize the manufacture of electric vehicles and ev batteries?
according to the parliamentary budget officer, that’s just the cost taxpayers are facing for developing an ev supply chain across canada in 13 different project groupings.
it doesn’t include such added costs as subsidizing ev sales by the federal government and six provinces, developing a national ev charging network, or strengthening and reconfiguring electricity grids across the country to handle the increased demand for electricity to power evs.
all of this when federal ev mandates to increase the sale of new evs to 60% of all new passenger vehicles by 2030 is only expected to lower canada’s industrial greenhouse gas emissions by 2% to 3% compared to what they would otherwise have been, according to a recent report by the canadian climate institute.
that’s a hugely inefficient way of reducing emissions among the more than 100 programs the federal government alone has created to address climate change, with a total price tag of more than $200 billion so far.
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it should also make it painfully obvious that evs weren’t developed to save the planet.
they were developed to save the auto sector and that’s already facing headwinds.
belgium-based umicore announced last week that it is delaying construction of its $2.8 billion ev battery materials manufacturing plant near kingston – to which the federal and ontario governments have earmarked almost $1 billion in public support – because of slow ev sales.
ford announced earlier this month that for the same reason, a $1.8 billion retrofit of its oakville assembly complex to manufacture evs it announced in 2020 – to which the federal and ontario government earmarked a total of $590 million – will now manufacture conventionally-powered super-duty trucks instead.
that followed an earlier announcement by ford in april that it was going to delay the production of evs until 2027, instead of the original start-up date of 2025.
to be fair, much of the federal and provincial support aimed at creating an ev supply chain in canada is tied to the actual production of evs and ev batteries – meaning the money hasn’t yet been spent.
in addition, canada’s auto sector was being subsidized by the federal and provincial governments long before the move toward evs, ostensibly to protect canadian jobs both directly and indirectly reliant on the auto sector.
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but as an environmental policy, public investments in the ev sector are notoriously inefficient.
a better use of the money would be to shore up canada’s beleaguered public infrastructure sector – roads, bridges, tunnels, public transit, sewers, water treatment plants, as well as our ability to fight wildfires – to make them more resilient to severe weather.
in that context, it’s also time to start calling out federal, provincial and municipal politicians who attribute the damage caused by any and all natural disasters these days to “climate change” as an excuse for decades of failures by all levels of government to properly maintain public infrastructure.
as one of countless examples, we saw this excuse at play in the wake of a major flood in toronto earlier this month that shut down roads, public transit, flooded basements and dumped more than 1.3 billion litres of partially-treated sewage into the city’s waterways.
in the real world, canada has always had severe weather caused by “climate change,” regardless of whether it’s the result of natural or human-induced factors.
toronto has been flooding since the last ice age ended 12,000 years ago, not because of human-induced climate change but because of local geography, the water systems that surround it and, in the modern era, urban densification.
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