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It is time for a serious rethink of the province’s EV mandates
By Resource Works
More News and Views From Resource Works Here
Two things can be true at once.
On the one hand, British Columbia’s electric vehicle (EV) sales mandates are ambitious, probably established with the best of intentions. On the other hand, they are also divorcing very rapidly from the present-day automobile market.
Transportation is a vital necessity for our economy, and all other modern economies for that matter.
There is no debate that BC, and Canada for that matter, should transition towards cleaner modes of transportation, whether that be for commuting to work or transporting goods and various products between destinations.
The problem lies in the method. BC’s provincial government has imposed a very aggressive timeline for the transition to EVs, and along with it a heavy-handed approach to enforcing compliance that will increase costs for consumers, manufacturers, businesses, and even low-income families.
As part of the BC government’s larger CleanBC plan, 26 percent of new vehicles purchased in the 2026 model year have to be electric. That is the easy part, if it can be called that.
By the 2030 model year, 90 percent of all new vehicle sales must be electric. The requirement rises to 100 percent by 2035. Even so, it will be years before all vehicles travelling the roads in BC are electric because of how long it takes before the existing vehicle fleet is “retired,” a polite way of saying they are scrapped.
And if all vehicles in BC were EVs, the equivalent of two more Site C dams’ worth of electricity would be needed, adding even more debt for BC Hydro customers to pay.
On paper, CleanBC and its EV mandates are all part of a progressive plan to help put the province on a green path towards its environmental goals.
In practice, however, EV mandates are beginning to resemble trying to fit a square piece into a round hole. The stark realities of the automobile market in 2025 should result in a serious reassessment.
EV sales in BC reached almost one-quarter of the total market share by mid-2024, before falling sharply to 18 percent by February of this year.
The slide started when the provincial government tightened up eligibility for its EV rebates last summer, which had the effect of making about 75 percent of EV models ineligible.
Making matters worse, Ottawa’s own EV rebate program suddenly ran dry early this year after a run of suspicious, last-minute sales claimed by Tesla. This has prompted an ongoing investigation into possible misconduct and abuse of the program.
Under BC’s electric vehicle mandates, manufacturers who fail to meet EV sales targets may be hit with penalties of up to $20,000 for every sale that exceeds their allotment of non-electric vehicles, i.e., those with internal combustion engines. If automakers want to avoid paying the penalties but can’t sell enough EVs, they have the option of buying credits from those car companies that have sold more than the required percentage of EVs.
Guess which company stands to profit because it has lots of credits to sell? That would be Tesla, the most prolific electric vehicle company in North America.
It’s an ironic twist of fate that BC policy may be helping funnel millions of Canadian dollars to one of the US President’s closest political allies, Elon Musk.
In the meantime, everyday consumers suffer from a loss of choice in the market. By distorting the market by reducing the supply of non-EVs, prices for all automobiles will likely increase.
This is what transpired during COVID-19, as supply chain ruptures resulted in a tighter supply of automobiles, prompting consumers to turn to the used vehicle market, which also saw its prices inflate. Lower-income people suffered the brunt of this, as used vehicles are the most affordable and realistic option.
Proponents defend EV mandates by asserting that strict and drastic action is required to slash emissions, but it flies in the face of economic history, the principle of consumer choice, and the need for innovation. Synthesizing these three will create the most cost-effective pathway to sustainably adopting new technologies.
The auto industry has already invested an astronomical $250 billion+ into expanding EV production in North America, partly in response to government policy direction and market shifts. However, policy reversals in the United States, combined with tariff uncertainty unleashed by our southern neighbour and lingering resistance to change from many consumers, have complicated the EV equation.
BC must rethink its strategy. We all acknowledge the need to adapt to a changing environment, and the economic climate has indeed changed.I
In the face of this change, there is no more effective way to destroy goodwill towards the CleanBC plan and electric vehicles than by having politicians force a punitive, heavy-handed mandate on the public.
A more realistic alternative is to encourage innovation by setting overall emission reduction targets on a graduated timeline, and allowing industry and consumers to choose which options help accomplish those goals. History has shown that whenever governments set out to select winners instead of losers, more often than not they end up backing the wrong horse.
When it comes to reducing emissions, the stakes are too high not to ride a winner.
Barry Penner is chair of the Energy Futures Institute, former president of the Pacific Northwest Economic Region and former four-term B.C. MLA and cabinet minister.
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