By Pamela Chelin and Josh Wingrove, Bloomberg News
The Ontario government said it will offer rebates of up to $14,500 to electric vehicle owners, matching a British Columbia program that will double as a source of loan guarantees for automakers importing electric vehicles into Canada.
Ontario’s move will put the province at odds with federal Finance Minister Bill Morneau, who wants to see the federal government’s $4,500 federal incentive for plug-in cars expire on schedule next year. The Ontario government, led by Premier Doug Ford, announced Monday it will make rebates available to eligible buyers starting Nov. 1.
The Ontario program responds to “intense customer demand for a rebate,” the province said in a statement. Officials will be meeting with industry and users of electric vehicles in coming weeks to work out more details, including how the scheme will be applied.
Canadian electric vehicle sales have been sluggish: Statistics Canada said in August that Ford Motor Co. had the most EVs sold in Canada by market share in the second quarter of 2018, though sales of those vehicles are concentrated in only one province.
The Ontario government, which said in May it was considering a “stronger policy,” is launching the program even though sales of new electric vehicles aren’t strong yet in the province, where most recent data comes from the province of Quebec. Ford’s Financial Services Agency wrote in June that Ontario would be “diverting significant amounts of tax revenues that could have been invested in more infrastructure and services to provide a 10-percent rebate for a volume-based purchase.”
Still, the province says incentives are key to making electric vehicles “viable” and reduce the cost of ownership. Federal incentives encourage buyers of plug-in vehicles to save as much as $7,500 in federal taxes and levies and government levies for gasoline-powered cars that many can’t, and there’s no current end date for the Canadian discount. The Ontario version allows more incentives for older models that take longer to burn their way through a customer’s bill.
“This supports broader electrification and puts us in line with federal policy, which intends to see 50 percent of all new vehicles sold in Canada be electric by 2030,” Ontario’s Minister of Economic Development, Trade and Employment Brad Duguid said in a statement.
The Quebec government offered rebates of up to 50 percent in 2016 and Quebec city authorities recently announced plans to offer a “diversion” fee to discourage charging electric vehicles in suburban neighborhoods.
Canada has committed to reducing greenhouse gas emissions to 30 percent below 2005 levels by 2030.
Carmakers had warned the province would need to provide rebate incentives that are comparable to what their customers elsewhere would be paying because of the high cost of new batteries.
— With assistance by Alexandre Robillard, Jordan Press, Melanie Ehrenkranz, and Claudia Cattaneo