GREEN: Carney should pull the plug on Canada’s EV revolution

During his election victory speech, Prime Minister Mark Carney repeated one of his favourite campaign slogans and vowed to make Canada a “clean energy superpower.” So, Canadians can expect Ottawa to “invest” more taxpayer money in “clean energy” projects, including electric vehicles (EVs) — the revolutionary transportation technology that’s been ready to replace internal combustion since 1901, yet still requires subsidies.

It’s a good time for a little historical review. In 2012, south of the border, the Barack Obama administration poured massive subsidies into companies peddling green tech, only to see a vast swath go belly up including Solyndra, would-be maker of advanced solar panels, which failed so spectacularly that CNN called the company the “poster child for well-meaning government policy gone bad.”

One might think that such a spectacular failure might have served as a cautionary tale for today’s politicians. But one would be wrong. Even as the EV transition slammed into stiff headwinds, the Justin Trudeau government and Ontario’s Doug Ford government poured $5 billion in subsidies into Honda to build an EV battery plant and manufacture EVs in Ontario. That “investment” came on top of a long list of other “investments” including $15 billion for Stellantis and LG Energy Solution; $13 billion for Volkswagen (or $16.3 billion, per the parliamentary budget officer), a combined $4.24 billion (federal/Quebec split) to Northvolt, a Swedish battery maker and a combined $644 million (federal/Quebec split) to Ford Motor Company to build a cathode manufacturing plant in Quebec.

How’s all that working out? Not great.

“Projects announced for Canada’s EV supply chain are in various states of operation, and many remain years away from production,” notes automotive/natural resource reporter Gabriel Friedman, writing in the Financial Post. “Of the four multi-billion-dollar battery cell manufacturing plants announced for Canada, only one — a joint venture known as NextStar Energy Inc. between South Korea’s LG Energy Solution Ltd. and European automaker Stellantis NV — progressed into even the construction phase.”

In 2023, Volkswagen said it would invest $7 billion by 2030 to build a battery cell manufacturing complex in St. Thomas, Ont. However, Friedman notes, “construction of the VW plant is not scheduled to begin until this spring (2025) and initial cell production will not begin for years.” Or ever, if U.S President Donald Trump’s pledge to end U.S. government support for a broad EV transition comes to pass.

In the meantime, other elements of Canada’s “clean tech” future are also in doubt. In December 2024, Saint-Jérome, Que.-based Lion Electric Co., which had received $100 million in provincial and government support to assemble batteries in Canada for electric school buses and trucks, said it would file for bankruptcy in the United States and creditor protection in Canada. And Ford Motor Company last summer scrapped its planned EV assembly plant in Oakville, Ontario, after receiving $640 million in federal and provincial support.

Of course, there’s Canada’s poster child of clean-tech-subsidy failure —  Northvolt. According to the CBC, the Swedish battery manufacturer, with plans to build a $7-billion factory in Quebec, has declared bankruptcy in Sweden, though Northvolt claims that its North American operations are “solvent.”

That’s cold comfort to some Quebec policymakers. “We’re going to be losing hundreds of millions of dollars in a bet that our government in Quebec made on a poorly negotiated investment,” said Parti Québécois MNA Pascal Paradis.

Elections often bring about change. If the Carney government wants to change course and avoid more clean-tech calamities, it should pull the plug on the EV revolution and avoid any more electro-boondoggles.