Canadian Manufacturing

Liberals tap $2.75B of promised transit dollars for zero emission buses

The investments could help the country's six electric-bus manufacturers scale up to compete internationally.

March 5, 2021  The Canadian Press

The federal Liberals are setting aside some of the billions of dollars planned in short-term transit spending to help municipalities further green their bus fleets.

The hope is that the $2.75 billion in traditional grant money will dovetail with the $1.5 billion an infrastructure-financing agency is supposed to invest toward the same cause.

Infrastructure Minister Catherine McKenna says the grant money is supposed to help cover the upfront cost of purchasing electric buses to replace the diesel-powered ones rumbling through Canadian streets.

She says federal funding has helped cities buy 300 buses and the government hopes the funding will help them add 5,000 zero-emission buses over the next five years.

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But she acknowledged there are added costs that need to be addressed, including having charging stations on transit routes and in existing depots.

The Liberals are hoping cities then turn to the Canada Infrastructure Bank to finance the cost of the remaining work.

The bank’s chief executive, Ehren Cory, says the energy savings expected from not having to buy diesel could, for instance, be used to pay off a low-interest loan from his agency.

“It’s quite a from-the-ground-up reinvestment and the savings will pay for a lot of that, but not for all of it,” he said, via video link.

“That’s why the combination of a grant from the government, a subsidy, combined with a loan against savings together will allow us to get the most done, allow us to make wholesale change quickly and do so at minimal impact to taxpayers.”

Garth Frizzell, president of the Federation of Canadian Municipalities, welcomed the funding as a way to speed up work in cities to replace diesel buses.

Joanna Kyriazis, senior policy adviser at Clean Energy Canada, noted that the investments could help the country’s six electric-bus manufacturers scale up to compete internationally.

“As Canada develops its battery supply chain — from raw metal and mineral resources to our North America-leading battery recycling companies — we must build the market for electric vehicles and their batteries at home,” she said in a statement.

The Liberals are promising billions in permanent transit funding as part of a post-pandemic recovery, including $3 billion annually in a transit fund starting in five years.


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