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The latest report from the Windfall Centre argues Ontario’s economy could benefit from the production of electric vehicles (EVs) to the tune of $3.6 billion by 2025.
The latest report from the Windfall Centre argues Ontario’s economy could benefit from the production of electric vehicles (EVs) to the tune of $3.6 billion by 2025.
The Windfall Centre, a non-profit, sustainability advocacy group, argues in Getting to 80: Meeting Ontario’s Emissions Targets that if electric vehicles can reach a 10 per cent share of total passenger vehicles by 2025, the province can expect total income from the auto sector to jump substantially. Over 34,000 person-years of work will be created in the process, they write.
Ontario’s Go Green Action Plan on Climate Change commits the province to reducing greenhouse gas emissions by 6 per cent by 2014, 15 per cent by 2020 and 80 per cent below 1990 levels by 2050. The province’s environmental watchdog, Gord Miller, has previously stated Ontario is on track to meet its 2014 targets but warns that meeting the 2020 targets is no sure thing.
Reducing the number of fossil-fuel burning cars on the road is only a small part of this strategy, but it can do more, the report argues. Electric vehicles can do much to help lower GHGs from the transportation sector, the single largest GHG-emitting sector in the province.
The Liberals’ goal to have 5 per cent of new vehicles on the road be EVs by 2020 is simply too “ambiguous,” writes Windfall executive director Brent Kopperson. And the automotive sector can do more to help drive this change, he feels.
“Considering Ontario is home to 10 automotive assembly plants and 300+ independent parts manufacturers that employ over 90,000 people, transitioning from manufacturing traditional vehicles to electric vehicles is expected to create more opportunities across various occupations,” Kopperson writes in the report.
The shift from traditional vehicles to EVs will also have the additional consequence of creating “disruptive change throughout business supply chains, the oil and gas industry, energy production and storage and the electrical infrastructure sector.”
Implementing such a sea change in how cars are made and purchased in Ontario wouldn’t be easy, especially not at first, Kopperson notes. In the beginning there would be economic losses, some of them substantial. They break down as follows:
- Reduction in gasoline use would cause $206 million in losses by 2025;
- Job losses in the oil and gas sector could reach 1,243;
- All levels of government would lose approximately $57 million in revenue and personal income tax loss of close to $14 million;
- $52 million would be lost by Ottawa on the fuel tax and $29 million lost by Ontario; and
- $8.3 million would be lost in HST by the federal government and an additional $15.5 million lost by the province.
These losses are nothing to sneeze at. But the economic and environmental benefits would more than make up for any disruptions in traditional transportation methods and financial setbacks to either Ottawa or Queen’s Park, the report argues.
Economic benefits of a 10 per cent switch to EVs by 2025 include a sizable bump to federal, provincial and municipal coffers, they argue. Additional tax revenue for all three levels of government would reach $1.08 billion with $526 million to Ottawa, $424 million to Ontario and $140 spread out over the province’s 444 municipalities.
“It is imperative that Ontario proactively engages to make Ontario an important hub of EV manufacturing not just for Canada but for all of North America,” Kopperson concludes. “Failure to do so would result not just in missed economic opportunities but also in economic losses.”
If Ontario fails to take advantage of its traditional automotive sector and help nudge it in a more sustainable direction it will likely find itself playing catch-up to more progressive jurisdictions soon enough, they note.
“It would likely never recover from these missed economic opportunities.”
