Canada - Policies and Legislation

By Country


In 2011, vehicle manufacturers began marketing EVs in Canada. In most cases, OEMs have developed these vehicles with the expectation that Province Governments will support early adoption through incentive programs. These incentive programs make EVs more cost-competitive with conventional vehicle prices, and encourage consumers to try out a new technology.

While there is no Federal incentive program in Canada, a number of provinces offer a range of tax rebates or credits on the purchase of an EV. However, all government incentives will eventually disappear and vehicle manufacturers will need to offer EVs that will appeal to consumers with or without subsidies.

Beyond cost, there are a number of other barriers to address for the uptake of EVs to succeed. Infrastructure and public acceptance will be key issues that will require government attention for the successful adoption of these vehicles. Only time will tell if consumers in Canada will purchase vehicles such as the Chevrolet Volt or the Nissan Leaf, but a trend of rising gasoline prices, coupled with government incentives, would cause EVs to become a more attractive option for Canadian consumers.

New vehicles sold in Canada are required to meet national emissions and safety standards administered by the Federal Government. Although most of Canada’s federal regulations for motor vehicles generally do not distinguish hybrid electric vehicles (HEVs), plug-in hybrid electric vehicles (PHEVs), and electric vehicles (EVs) from conventional vehicles, national policies continue to move towards increasingly stringent GHG emissions standards that could encourage growing use of all EV vehicle types. At the provincial level, some provinces have started to address PHEVs and EVs in their policies. Québec, Ontario, and British Columbia have announced a variety of goals and plans to support the introduction of these vehicles.

 Federal Policy

Emissions Standards

Because of the rising concern about the impact of GHG emissions, vehicle fuel consumption has become an issue of importance for governments. Over the past 30 years, Canada has had a voluntary policy for improving the fuel consumption of cars and light trucks. Despite some improvements in fuel consumption and emission-control technology that have resulted from adherence to these voluntary policies, the total fuel consumed and GHG emissions have still risen substantially over the last two decades.

In response to this increase, in 2005 the Canadian automotive industry signed a memorandum of understanding (MOU) to reduce GHG emissions from cars and light trucks by 5.3 million metric tons in 2010. As part of this MOU, a report was released in the fall of 2010 indicating that the Canadian automotive industry surpassed the first interim goal set out in the MOU, having reduced annual GHG emissions by over 3 million metric tons in 2007. 

In October 2010, the Minister of the Environment announced new regulations that establish progressively more stringent GHG emission standards for new passenger automobiles and light trucks for the 2011–2016 model years. Through the implementation of the proposed standards, it is anticipated that the average GHG emission performance of the 2016 Canadian fleet of new cars and light trucks would match the average level of 155 g CO2/km (250 g CO2/mile) that has been projected for the United States.

As a result of the regulations, it is projected that the average GHG emission performance of new vehicles for the 2016 model year will be about 25% lower than the vehicles that were sold in Canada in 2008. Given that these stringent GHG emissions regulations were finalized in October 2010, the voluntary GHG MOU was terminated. Canada’s national emissions regulations are established under the authority of the Canadian Environmental Protection Act and administered by Environment Canada.

Because of Canada’s geopolitical links with the U.S., all the above-mentioned standards and regulations are being continually developed with the intent of achieving full harmonization, both to ease the burden on the automotive industry and to facilitate trade and product availability. Canada also participates in the United Nations Economic Commission for Europe (UNECE) world forum for the creation of global technical regulations.

Safety Standards

Canada’s Motor Vehicle Safety Act (MVSA), administered by Transport Canada, regulates the manufacture and import of motor vehicles and motor vehicle equipment in order to reduce the risk of death, injury, and damage to property and the environment.

In Canada, electric passenger vehicles must meet the safety standards required by the MVSA that apply to all passenger cars. Electric low-speed vehicles (LSVs), however, do not have the same legal status as a passenger car, and are not required to meet the same strict safety standards. Specific requirements for low-speed vehicles with the full specifications are outlined in Technical Standards Document No. 500 of the Canadian Motor Vehicle Safety Standards .

The Federal government does not have any statutory role in regulating LSV road use; however, it provides advice and recommendations regarding vehicles and their usage to Canadians. While provinces and territories regulate public road use and vehicle and driver licensing, Transport Canada does not encourage the use of LSVs on public roads, since they are not required to provide the same level of safety as mainstream vehicles. The provinces of Québec, Ontario, Manitoba, and British Columbia have introduced legislation or pilot projects for the use of LSVs.

In 2001, Transport Canada amended the Motor Vehicle Safety Regulations to allow the introduction of power-assisted bicycles in Canada. This amendment created a definition specifically for power-assisted bicycles and applied separate technical and safety requirements.

Policy by Province

The provincial policy instruments for PHEVs and EVs as of 2010 are summarized in a downloadable table.