From the Fraser Institute

By Annika Segelhorst and Elmira Aliakbari

According to Steven Guilbeault, former environment minister under Justin Trudeau and former member of Prime Minister Carney’s cabinet, “Switching to an electric vehicle is one of the most impactful things Canadians can do to help fight climate change.”

And the Carney government has only paused Trudeau’s electric vehicle (EV) sales mandate to conduct a “review” of the policy, despite industry pressure to scrap the policy altogether.

So clearly, according to policymakers in Ottawa, EVs are essentially “zero emission” and thus good for environment.

But is that true?

Clearly, EVs have some environmental advantages over traditional gasoline-powered vehicles. Unlike cars with engines that directly burn fossil fuels, EVs do not produce tailpipe emissions of pollutants such as nitrogen dioxide and carbon monoxide, and do not release greenhouse gases (GHGs) such as carbon dioxide. These benefits are real. But when you consider the entire lifecycle of an EV, the picture becomes much more complicated.

Unlike traditional gasoline-powered vehicles, battery-powered EVs and plug-in hybrids generate most of their GHG emissions before the vehicles roll off the assembly line. Compared with conventional gas-powered cars, EVs typically require more fossil fuel energy to manufacture, largely because to produce EVs batteries, producers require a variety of mined materials including cobalt, graphite, lithium, manganese and nickel, which all take lots of energy to extract and process. Once these raw materials are mined, processed and transported across often vast distances to manufacturing sites, they must be assembled into battery packs. Consequently, the manufacturing process of an EV—from the initial mining of materials to final assembly—produces twice the quantity of GHGs (on average) as the manufacturing process for a comparable gas-powered car.

Once an EV is on the road, its carbon footprint depends on how the electricity used to charge its battery is generated. According to a report from the Canada Energy Regulator (the federal agency responsible for overseeing oil, gas and electric utilities), in British Columbia, Manitoba, Quebec and Ontario, electricity is largely produced from low- or even zero-carbon sources such as hydro, so EVs in these provinces have a low level of “indirect” emissions.

However, in other provinces—particularly Alberta, Saskatchewan and Nova Scotia—electricity generation is more heavily reliant on fossil fuels such as coal and natural gas, so EVs produce much higher indirect emissions. And according to research from the University of Toronto, in coal-dependent U.S. states such as West Virginia, an EV can emit about 6 per cent more GHG emissions over its entire lifetime—from initial mining, manufacturing and charging to eventual disposal—than a gas-powered vehicle of the same size. This means that in regions with especially coal-dependent energy grids, EVs could impose more climate costs than benefits. Put simply, for an EV to help meaningfully reduce emissions while on the road, its electricity must come from low-carbon electricity sources—something that does not happen in certain areas of Canada and the United States.

Finally, even after an EV is off the road, it continues to produce emissions, mainly because of the battery. EV batteries contain components that are energy-intensive to extract but also notoriously challenging to recycle. While EV battery recycling technologies are still emerging, approximately 5 per cent of lithium-ion batteries, which are commonly used in EVs, are actually recycled worldwide. This means that most new EVs feature batteries with no recycled components—further weakening the environmental benefit of EVs.

So what’s the final analysis? The technology continues to evolve and therefore the calculations will continue to change. But right now, while electric vehicles clearly help reduce tailpipe emissions, they’re not necessarily “zero emission” vehicles. And after you consider the full lifecycle—manufacturing, charging, scrapping—a more accurate picture of their environmental impact comes into view.

Annika Segelhorst

Junior Economist

Elmira Aliakbari

Director, Natural Resource Studies, Fraser Institute

From the Canadian Energy Centre

By Deborah Jaremko

For Canada, the path to a stronger economy — and stronger global influence — runs through energy.

That’s the view of David Detomasi, a professor at the Smith School of Business at Queen’s University.

Detomasi, author of Profits and Power: Navigating the Politics and Geopolitics of Oil, argues that there is a moral case for developing Canada’s energy, both for Canadians and the world.

David Detomasi. Photo courtesy Smith School of Business, Queen’s University

CEC: What does being an energy superpower mean to you?

DD: It means Canada is strong enough to affect the system as a whole by its choices.

There is something really valuable about Canada’s — and Alberta’s — way of producing carbon energy that goes beyond just the monetary rewards.

CEC: You talk about the moral case for developing Canada’s energy. What do you mean? 

DD: I think the default assumption in public rhetoric is that the environmental movement is the only voice speaking for the moral betterment of the world. That needs to be challenged.

That public rhetoric is that the act of cultivating a powerful, effective economic engine is somehow wrong or bad, and that efforts to create wealth are somehow morally tainted.

I think that’s dead wrong. Economic growth is morally good, and we should foster it.

Economic growth generates money, and you can’t do anything you want to do in social expenditures without that engine.

Economic growth is critical to doing all the other things we want to do as Canadians, like having a publicly funded health care system or providing transfer payments to less well-off provinces.

Over the last 10 years, many people in Canada came to equate moral leadership with getting off of oil and gas as quickly as possible. I think that is a mistake, and far too narrow.

Instead, I think moral leadership means you play that game, you play it well, and you do it in our interest, in the Canadian way.

We need a solid base of economic prosperity in this country first, and then we can help others.

CEC: Why is it important to expand Canada’s energy trade?

DD: Canada is, and has always been, a trading nation, because we’ve got a lot of geography and not that many people.

If we don’t trade what we have with the outside world, we aren’t going to be able to develop economically, because we don’t have the internal size and capacity.

Historically, most of that trade has been with the United States. Geography and history mean it will always be our primary trade partner.

But the United States clearly can be an unreliable partner. Free and open trade matters more to Canada than it does to the U.S. Indeed, a big chunk of the American people is skeptical of participating in a global trading system.

As the United States perhaps withdraws from the international trading and investment system, there’s room for Canada to reinforce it in places where we can use our resource advantages to build new, stronger relationships.

One of these is Europe, which still imports a lot of gas. We can also build positive relationships with the enormous emerging markets of China and India, both of whom want and will need enormous supplies of energy for many decades.

I would like to be able to offer partners the alternative option of buying Canadian energy so that they are less reliant on, say, Iranian or Russian energy.

Canada can also maybe eventually help the two billion people in the world currently without energy access.

CEC: What benefits could Canadians gain by becoming an energy superpower? 

DD: The first and primary responsibility of our federal government is to look after Canada. At the end of the day, the goal is to improve Canada’s welfare and enhance its sovereignty.

More carbon energy development helps Canada. We have massive debt, an investment crisis and productivity problems that we’ve been talking about forever. Economic and job growth are weak.

Solving these will require profitable and productive industries. We don’t have so many economic strengths in this country that we can voluntarily ignore or constrain one of our biggest industries.

The economic benefits pay for things that make you stronger as a country.

They make you more resilient on the social welfare front and make increasing defence expenditures, which we sorely need, more affordable. It allows us to manage the debt that we’re running up, and supports deals for Canada’s Indigenous peoples.

CEC: Are there specific projects that you advocate for to make Canada an energy superpower?

DD: Canada’s energy needs egress, and getting it out to places other than the United States. That means more transport and port facilities to Canada’s coasts.

We also need domestic energy transport networks. People don’t know this, but a big chunk of Ontario’s oil supply runs through Michigan, posing a latent security risk to Ontario’s energy security.

We need to change the perception that pipelines are evil. There’s a spiderweb of them across the globe, and more are being built.

Building pipelines here, with Canadian technology and know-how, builds our competitiveness and enhances our sovereignty.

Economic growth enhances sovereignty and provides the resources to do other things. We should applaud and encourage it, and the carbon energy sector can lead the way.