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Aggressive sales target needed to decarbonize trucks, buses: Pembina Institute

Transition could also increase energy security and revitalize Canadian manufacturing

Transitioning heavy-duty vehicles like trucks to clean energy will play a pivotal role in Canada's climate target, argues the latest report from the Pembina Institute. (Courtesy Pembina Institute)

A stringent sales standard and billions in infrastructure upgrades for Canada’s medium- and heavy-duty trucks and buses can drive the decarbonization of the country’s transportation sector, according to a report by the Pembina Institute.

In Canada’s Pathway to Net-Zero for Medium- and Heavy-Duty Trucks and Buses, the national energy think tank lays out its ZeroX2040 strategy, designed to transition the country’s fleet of fossil-fuelled medium- and heavy-duty vehicles to electric and hydrogen-fuelled versions by 2040.

The report, co-authored by Adam Thorn, director of the transportation program at Pembina Institute, establishes a myriad of steps covering zero-emissions vehicles (ZEVs) and infrastructure to fulfill ZeroX2040, such as stronger emissions standards and more funding for charging networks.

It could serve as a blueprint for the government, as Canada does not have a strategy to meet its sales mandate for zero-emissions medium- and heavy-duty vehicle (MHDV) sales, Thorn told Sustainable Biz Canada.

Energy security, supplying critical minerals and revitalizing Canadian manufacturing are additional benefits.

“I think this is good for Canada. This shouldn’t necessarily rely on any political parties. They should be able to see the advantages of that, of increasing Canadian leadership in manufacturing, in jobs,” Thorn said.

Cleaning up medium- and heavy-transportation

The report points out the importance of decarbonizing the transportation sector, which the federal government found is the second-largest source of greenhouse gas emissions after the oil and gas industry.

With little room for error for Canada to achieve net-zero by 2050, the Pembina Institute says implementing its plan would play a pivotal role in the country reaching its climate target. Following ZeroX2040 would cut MHDV carbon emissions from 35 megatonnes in 2020 to 10 or less megatonnes by 2050, it states.

The two-part report focuses on ZEVs and the charging and refuelling infrastructure the institute says will help Canada meet its zero-emissions MHDV sales targets of 35 per cent by 2030 and the 100 per cent by 2040.

Recommendations for vehicles

Key to the vehicles portion of the plan is a sales standard – requiring manufacturers and importers to gradually increase ZEV sales to 100 per cent. The sales requirements would be staggered across different categories to give time for a smoother transition across markets and infrastructure.

The strain on the electrical grid is something the plan addresses by phasing sales requirements across vehicle categories, Thorn said.

“Because of the phased-in approach, focusing on those areas that are relatively low-hanging fruit right now — buses and medium-duty vehicles — we know there is time to both build the capacity in the grid as well as the capacity to deliver electricity to the vehicles over this phased-in period of time.”

The report urges more precise steps including:

  • encouraging provincial governments to require all new school and transit bus purchases are ZEVs by 2030;
  • collaborating with Canada-based ZEV manufacturers to train 10,000 technicians by 2030; and
  • increasing the stringency of the vehicle emissions standard as an interim policy for new non-zero-emissions MHDVs.

Hydrogen fuel cell vehicles have a “real opportunity” to decarbonize heavy-duty vehicles, Thorn said, because battery technology is not suitably advanced for the category. “The advantage of hydrogen is that you got really fast refuelling times, sort of like diesel as opposed to battery-electric vehicles,” he said.

The Pembina Institute recommends Canada support R&D and innovation in hydrogen fuel cell vehicles, such as federal support to incentivize small and medium enterprises to undertake “innovative initiatives within the hydrogen supply chain.”

Approximately $16 billion by 2030 will be needed to enable the production and uptake of zero-emissions MHDVs through reforms like the Zero Emission Transit Fund, the report states.

Building out ZEV infrastructure

To charge the zero-emissions MHDVs on the road, infrastructure improvements will be necessary. The institute points to issues like the lack of public and private funding and incomplete transitional planning.

There is also the sheer scale. The report estimates by 2030, 70,000 Level 2 private, fleet depot chargers will need to be in place, up to 450,000 by 2050. Hydrogen refuelling stations must increase 15-fold — from 2,000 in 2030 to 30,000 in 2050.

The Pembina Institute’s prescriptions for infrastructure are:

  • financial support and incentives to address the costs associated with building out an infrastructure network;
  • establishing milestones and targets that set out where and when charging and refuelling stations should be installed;
  • creating standardization protocols for chargers and a clear outline of utility responsibilities to support a well-connected and reliable network; and
  • capacity building supports and initiatives specifically designed to upskill and prepare a ZEV-ready labour force.

For example, the Canadian government could allocate $1 billion under the Zero Emission Transit Fund by 2030 toward the deployment of chargers for transit and school buses. Ottawa could also establish a consistent standard for charging infrastructure.

The price tag for infrastructure under ZeroX2040 is approximately $4.5 billion by 2030.

It will be an expensive transition to go from mostly internal combustion engines to electricity and hydrogen, Thorn concedes, which means new financial tools are required to fund the change. He named innovations like electrification-as-a-service as one option.

Following this report, the Pembina Institute plans to study how the remaining internal combustion engine vehicle fleet could reduce emissions by using alternative energy sources like biofuels or renewable natural gas.

Editor's note: A sentence mistakenly attributed the Pembina Institute as the source of data that found the transportation industry is the second-highest emitting industry in Canada, when it was from the Canadian government. Sustainable Biz Canada regrets the error.

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