Shocking Lack of Details on Cost of Electric Car Push

REGINA, SK: New research from think tank SecondStreet.org shows that no level of government has properly researched what Canadians will have to pay — through their power bills — as a result of Ottawa’s push for widespread electric vehicle (EV) usage. The push for EVs is part of the federal government’s plan to ban new gas-powered vehicle sales by 2035.

Not only do electric cars require large amounts of power, many jurisdictions will have to upgrade parts of their electricity distribution systems (the power lines in neighbourhoods) and may need to build new transmission lines as new power plants and power sources are built.

“It’s good that there are companies producing electric cars as more competition in the auto sector is good for consumers,” said study co-author Colin Craig. “However, the federal government’s decision to push for everyone to drive electric vehicles means significant upgrades are required to our electricity grids. What will that cost households through their power bills? No one knows.”

SecondStreet.org filed Freedom of Information (FOI) requests with provincial governments, asking for any analysis on the impact to the electrical system and the cost to ratepayers due to the zero-emission vehicle (ZEV) mandate. While the provinces are not responsible for Ottawa’s push for electric vehicles, they are in charge of electric grids within their borders.

Findings from SecondStreet.org’s research include:

  • Not one province had estimates on how much the mandate will cost ratepayers through their power bills, though there was general agreement that the ban on gas-powered vehicles would cause a strain to the electric grid.
  • Lower income households will be hit hardest as electricity grids are upgraded. This is because utility charges make up a greater percentage of their household spending. 
  • Households that do not own electric vehicles may need to subsidize electric grid upgrades, for households that do own electric cars.
  • A University of Regina report, commissioned by SaskPower, examined the impact of EVs on local distribution systems. It found that, in the prairie province, a 22-house distribution system could handle charging 11 EVs. Given that many homes have two vehicles, it’s easy to see how significant upgrades would be needed.
  • NL (Newfoundland and Labrador) Hydro doesn’t believe that the province will be able to reach the federal government’s target of 100% new ZEV sales by 2035.

“These are just a few of the challenges we uncovered in this study,” said co-author Dom Lucyk. “An influx of EVs will also mean significant investments are needed to build charging infrastructure, to generate more power, to handle the extra weight of heavier EVs on roads, and so on. Overall, it’s clear that the country isn’t ready for this massive mandate.”

Ultimately, Ottawa implemented a policy without calculating the cost to Canadian households. With that in mind,  it would be prudent to pause the ZEV mandate, go back and do the homework first. After seeing how it affects their wallets, many Canadians might not support the government’s policy.

To see Policy Brief: Shocking Lack of Details on Cost of Electric Car Mandate – click here.

See each province’s FOI response below:

B.C. Ministry of Energy, Mines and Low Carbon Innovation — FOI 1, FOI 2
B.C. Hydro — FOI 1, FOI 2
Alberta Electric System Operator — FOI 1, FOI 2
Alberta Ministry of Energy — FOI 
SaskPower — FOI 1, FOI 2
Saskatchewan Ministry of Energy — FOI
Manitoba Hydro — FOI 1, FOI 2
Manitoba Department of Environment and Climate — FOI
Ontario Ministry of Transportation — FOI
Ontario Energy Board — FOI 1, FOI 2
Hydro Quebec — FOI 1, FOI 2
Quebec Ministry of the Environment, the Fight against Climate Change, Wildlife and Parks — FOI
Nova Scotia Natural Resources and Renewables — FOI
New Brunswick Natural Resources and Energy Development — FOI 1, FOI 2
Newfoundland Department of Industry, Energy and Technology — FOI 1, FOI 2
PEI Ministry of Energy — FOI 1, FOI 2

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Prevention – reduce demand in the first place

If Canadians lived healthier lives, we could reduce demand for emergency services, orthopaedic surgeries, primary care and more. 

For instance, if you visit the Canadian Cancer Society’s website, you’ll read that “about four in ten” cancer cases are preventable. The Heart and Stroke Foundation notes that “almost 80 percent of premature heart disease and stroke can be prevented through healthy behaviours.” A similar number of Diabetes cases are also preventable. 

Many joint replacements and visits to ERs and walk-in clinics could also be avoided through healthy living. 

To be sure, not all health problems can be avoided through healthy living – everyday the system treats Canadians with genetic conditions, helps those injured in unavoidable accidents and more.  

But there is an opportunity to reduce pressure on the health care system through Canadians shifting to healthier lifestyles – better diets, more exercise, etc. 

To learn more, watch our Health Reform Now documentary (scroll up) or see this column. 

Partner with non-profits and for-profit clinics

European countries will partner with anyone who can help patients. 

It doesn’t matter if it’s a non-profit, a government entity or a private clinic. What matters is that patients receive quality treatment, in a timely manner and for a competitive price.  

In Canada, governments often delivery services using government-run hospitals instead of seeing if non-profit or private clinics could deliver the services more effectively. 

When governments have partnered with non-profit and private clinics, the results have often been quite good – Saskatchewan, Ontario and British Columbia are just a few examples of where partnerships have worked well. 

Canada should pursue more of these partnerships to reduce wait times and increase the volume of services provided to patients.  

To learn more, watch our Health Reform Now documentary (scroll up) or see the links above. 

Make cross border care more accessible

In Canada, citizens pay high taxes each year and we’re promised universal health care services in return. The problem is, wait times are often extremely long in our health system – sometimes patients have to wait years to see a specialist or receive surgery. 

If patients don’t want to wait long periods, they often have to reach into their own pocket and pay for treatment outside the province or country. 

Throughout the European Union, we also find universal health care systems. But a key difference is that EU patients have the right to go to other EU countries, pay for surgery and then be reimbursed by their home government. Reimbursements cover up to what the patient’s home government would have spent to provide the treatment locally. 

If Canada copied this approach, a patient waiting a year to get their hip operation could instead receive treatment next week in one of thousands of surgical clinics throughout the developed world. 

Governments benefit too as the patient is now back on their feet and avoiding complications that sometimes come with long wait times – meaning the government doesn’t have to treat those complications on top of the initial health problem. 

To learn more, watch our Health Reform Now documentary (scroll up) or this shorter video. 

Legalize access to non-government providers

Canada is the only country in the world that puts up barriers, or outright bans patients from paying for health services locally. 

For instance, a patient in Toronto cannot pay for a hip operation at a private clinic in Toronto. Their only option is to wait for the government to eventually provide treatment or leave the province and pay elsewhere. 

Countries with better-performing universal health care systems do not have such bans. They allow patients a choice – use the public system or pay privately for treatment. Sweden, France, Australia and more – they all allow choice. 

Why? One reason is that allowing choice means some patients will decide to pay privately. This takes pressure off the public system. For instance, in Sweden, 87% of patients use the public system, but 13% purchase private health insurance. 

Ultimately, more choice improves access for patients. 

To learn more, watch our Health Reform Now documentary (scroll up) or watch this short clip on this topic. 

Shift to funding services for patients, not bureaucracies

In Canada, most hospitals receive a cheque from the government each year and are then asked to do their best to help patients. This approach is known as “block funding”. 

Under this model, a patient walking in the door represents a drain on the hospital’s budget. Over the course of a year, hospital administrators have to make sure the budget stretches out so services are rationed. This is why you might have to wait until next year or the year after for a hip operation, knee operation, etc. 

In better-performing universal health systems, they take the opposite approach – hospitals receive money from the government each time they help a patient. If a hospital completes a knee operation, it might receive, say, $10,000. If it completes a knee operation on another patient, it receives another $10,000. 

This model incentivizes hospitals to help more patients – to help more patients with knee operations, cataract surgery, etc. This approach also incentivizes hospitals to spend money on expenses that help patients (e.g. more doctors, nurses, equipment, etc.) rather than using the money on expenses that don’t help patients (e.g. more admin staff). 

To learn more about this policy option, please watch our Health Reform Now documentary (scroll up) or see this post by MEI.