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Automotive

Government subsidies cost more than EV capital investments

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From the Canadian Taxpayers Federation

Author: Franco Terrazzano

The Canadian Taxpayers Federation is calling for an end to corporate welfare following today’s Parliamentary Budget Officer report showing government subsidies are 14 per cent more than the capital investments corporations are making in the electric-vehicle supply chain.

“Putting taxpayers on the hook for more money than these corporations are spending to build their own factories is an awful deal for ordinary Canadians,” said Franco Terrazzano, CTF Federal Director. “Taxpayers are being taken to the cleaners with this EV corporate welfare.”

The PBO released a report regarding recent government subsidies for EV factories.

“For the $46.1 billion in investments (capital expenses) across the EV supply chain, PBO estimates total corresponding government support (for capital and operating expenses) to be up to $52.5 billion, which is $6.3 billion (14 per cent) higher than announced investments,” according to the PBO report.

Of the $52.5 billion in taxpayer subsidies, the PBO estimates $31.4 billion is coming from the federal government and $21.1 billion is coming from provincial governments.

“These lopsided numbers show that these corporate handouts are nothing more than a vanity project for politicians,” said Jay Goldberg, CTF Ontario Director. “If these politicians want to grow the economy, they should cut taxes and red tape rather than make bad bets with taxpayers’ money.”

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Automotive

Two thirds of Canadians say banning conventional vehicles by 2035 is “unrealistic”

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From the Montreal Economic Institute

Seven in 10 Canadians are concerned about the negative impact of cancelled energy projects on Canadian jobs.

More than half of Canadiens are against the federal mandate forcing all new cars sold in Canada to be electric by 2035, shows a new MEI-Ipsos survey released this morning.

“Across the country, Canadians are a lot more hesitant to ban conventional vehicles than their elected representatives in Ottawa are,” said Krystle Wittevrongel, director of research at the MEI. “They have legitimate concerns, most notably with the cost of those cars, and federal and provincial politicians should take note.”

The poll shows that 55 per cent of Canadians disagree with Ottawa’s decision to ban the sale of conventional vehicles by 2035. In every region surveyed, a larger number of respondents were against the ban than in favour of it.

Among Canadians who don’t already own an electric vehicle, slightly fewer than one in four said their next car would be electric.

Key reasons cited for this lukewarm attitude included the high cost of the cars (70 per cent), the lack of charging infrastructure (66 per cent), and their reduced performance in Canada’s cold climate (64 per cent).

Across the country, only 26 per cent of Canadians believe Ottawa’s plan to ban the sale of conventional vehicles is realistic. Meanwhile, 66 per cent maintain that the plan is unrealistic.

“Canadians understand that 2035 is sooner than Ottawa thinks, and nothing indicates electric vehicle adoption rates are going to follow what federal lawmakers anticipated,” notes Ms. Wittevrongel. “Concerns with their high cost, the lack of charging infrastructure and their poor performance in our cold climate remain strong.”

The survey also found Canadians were troubled by the effects that federal legislation has had in stalling or cancelling energy projects.

Seven in 10 respondents were concerned by the negative impact on Canadian jobs arising from the cancellation of tens of billions of dollars in energy projects due to regulatory hurdles.

Slightly more than three in four Canadians (76 per cent) say the federal government’s environmental impact assessment project takes too long, with only nine per cent taking the opposite view.

“Canadians understand that our energy industry plays a key role in Canada’s economy, and that lengthy approval delays from regulators have a negative impact on a project’s chances of happening,” explains Ms. Wittevrongel. “They are looking for leadership in Ottawa and in the provinces to cut down on bureaucratic hurdles and shorten the time it takes to get shovels in the ground.”

A sample of 1,190 Canadians 18 years of age and older was polled between September 18th and 22nd, 2024. The results are accurate to within ± 3.3 percentage points, 19 times out of 20.

The results of the MEI-Ipsos poll are available here: https://www.iedm.org/wp-content/uploads/2024/10/ipsos_survey_energy_in_canada_september_2024.pdf.

The MEI is an independent public policy think tank with offices in Montreal and Calgary. Through its publications, media appearances, and advisory services to policymakers, the MEI stimulates public policy debate and reforms based on sound economics and entrepreneurship.

 

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Economy

Federal government’s environmental policies will do more harm than good

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From the Fraser Institute

By Matthew Lau

The study covered grocery bags, food packaging, soft drink containers, furniture, t-shirts and other plastic products. In most cases, replacing plastics with alternatives causes greenhouse gas emissions to rise by 35 to 700 per cent.

Through a variety of regulatory and spending initiatives, the Trudeau government is expanding its control over our lives, often in the name of climate change or other environmental objectives. For example, the government plans to force consumers to buy electric vehicles instead of conventional cars and has proposed or implemented plastics restrictions on consumers and businesses—everything from plastic drinking straws and plastic utensils to clothing material and food packages.

However, while evidence of the high costs to consumers continues to mount, evidence of the environmental benefits is notably absent. Indeed, many recent studies provide evidence that Ottawa’s restrictions on consumers may well cause net environmental harm. One reason is that the plastic products the federal government is so intent on restricting are more environmentally efficient than alternatives.

study published earlier this year in the journal Environmental Science & Technology concludes, “15 of the 16 applications a plastic product incurs fewer greenhouse gas emissions than their alternatives.” The study covered grocery bags, food packaging, soft drink containers, furniture, t-shirts and other plastic products. In most cases, replacing plastics with alternatives causes greenhouse gas emissions to rise by 35 to 700 per cent.

Why? Because plastic generally takes less energy to manufacture and transport than the alternatives. In fact, many plastic products that are more environmentally friendly than non-plastic alternatives (according to the study) are products the Trudeau government wants to ban or curtail through regulation.

Other evidence shows plastic bans of the type imposed in Canada cause environmental ruin, contrary to the predictions of politicians. For example, research in New Jersey found after single-use plastic bags were banned in 2022, shoppers switched to the heavier reusable bags. “Owing to the larger carbon footprint of the heavier, non-woven polypropylene bags,” reported the Wall Street Journal, “greenhouse gas emissions rose 500%.”

Similarly, the New York Times reported that while California banned single-use plastic bags almost a decade ago, in 2023 “Californians threw away more plastic bags, by weight, than when the law first passed, according to figures from CalRecycle, California’s recycling agency.”

Also from the Wall Street Journal, analyses suggest electric vehicles often emit more particulate pollution (dust, dirt and soot) than conventional vehicles. That’s because most particulate pollution these days is not from the tailpipe but from tire wear. EVs are much heavier than conventional vehicles so their tires wear out faster, increasing particulate pollution. The firm Emissions Analytics compared a plug-in electric to a hybrid vehicle and found the plug-in electric, which weighed more, emitted about one-quarter more particulate matter than the hybrid as a result of tire wear.

Last year, the chair of the U.S. National Transportation Safety Board noted that EVs manufactured by Ford, Volvo and Toyota were all about 33 per cent heavier than conventionally powered versions of those same vehicles. That’s a problem not only for the environment but also for driver safety—and yet more evidence that the Trudeau government’s EV mandates will harm Canadians.

When it comes to vehicles, plastic products and many other things, the Trudeau government should begin reducing its control over consumers. The harm to consumers is evident; the compensating benefits to the environment—if any—are not.

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