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Canada Will Regulate Vehicle Fuel Economy

Projected increase in greenhouse gas emissions in Canada. Click to enlarge.

Declaring that “the era of voluntary compliance is over, ” Canadian Prime Minister Stephen Harper has said that for the first time ever, Canada “will regulate the fuel efficiency of motor vehicles, beginning with the 2011 model year.

Harper said that his government would also move to regulate greenhouse gas emissions from major industrial sectors. His speech came in the wake of the recent release of the first volume of the fourth assessment report of climate change by the IPCC (earlier post), and in the context of Canada’s rapidly worsening greenhouse gas emissions situation.

Our government supports a concerted global effort to deal with climate change—and such an effort must include the major emitters, including the United States and China.

But we cannot ask others to act unless we are prepared to start at home, with real action on greenhouse gases and air pollution. After more than a decade of inaction on air quality and greenhouse gasses, Canada has one of the worst records in the developed world.

The previous government committed to ambitious greenhouse gas targets, and then presided over a 27% increase.

...for the first time ever, we will set out enforceable regulatory targets for the short, medium and long term. The era of voluntary compliance is over.

By 2010 Canada’s emissions would be about 46% above the targets it had agreed to hit by 2012 under the Kyoto Protocol on climate change. That’s up from 35 percent above the target in 2004, the latest year for which data are available.

Canada currently does not regulate vehicle fuel economy, but it tracks US CAFE standards through voluntary action by automakers.



First the EU, and now Canada. Will the US be shamed into action? Is Washington even capable of shame?


Why wait until 2011? It's not like there's a huge Canadian auto industry that will have to retool. Canada's a small enough market that this won't induce car companies to change their design and manufacturing strategy.

All this will change is advertising strategies and pricing so that the companies stay in compliance. So, why wait? Why not start in 2008?


In fact Canada has huge auto industry and is the main employer in the largest province population and economic output. The North American auto industry is heavily international with assembly and parts suppliers in both the US and Canada and now add Mexico as a parts source and assembly area. This is quite a politically charged subject in Canada now since GM,Ford and today Chrysler have announced layoffs and plant closures. It seems we are also due for another election in the next year or so. It remains to be seen if this election will be fought on green issues versus traditional economic issues. Oh well the automaker will just lobby the government for some research grants to meet these new fuel economy guidelines. It's kinda funny that Toyota and Honda both receive much less Canadian government support but have pushed ahead to make improvements and have been profitable doing it. While the big 3 constantly beg for money and don't deliver.


Ontario exports more cars to the US than all of the rest of the world combined. A 'small' but vital industry


Harper doesn't actally want to do anything, his ears are full of the sweet $$$ sounds of his oil buddies. He knows that he has to sound green if he wants a chance to win the next election. So he'll make all the right noises and try and pass legislation (minority government) that won't take effect for years. He's just trying to fool most of the people some of the time (until after the next election)


It's clear the current government is just paying lipservice to the issue, just as previous governments did, especially since the environment was nowhere to be found on the agenda last year and all of a sudden there's this massive focus on it, but all goals set so far off that it would require "realistic adjustments" (as lobbied by the usual suspects) by the time it's actually in effect, like the California ZEV mandate. Canada needs to get serious about producing energy without producing CO2 waste on a large scale because at some point things have to change, today for climate, or tomorrow with depletion. Better to do it before we hit serious global troubles with depletion because we have the resources at this time, alternatives become exponentially more expensive to develop with the increasing costs of primary energy source due to scarcity.


Surely it has to be done NAFTA wide, not just by Canada which has only 30M people.
The EU is a large enough bloc to have an effect - Canada alone would seem too small.

Mark A

This just proves another point that the US was, perhaps, smart in not ratifying the Kyoto Protocol, as yet another country is being shown to not be able to deliver the correct reductions. Spain, Greece, Portugal, Ireland, and to a lesser extent, Japan are having similar concerns, as of 2004.


This is a joke.
1) Three years from now, gas prices will have organically raised the mileage on vehicles sold.

2) They can always change their mind before it goes into effect.

3) This might actually help sell the trucks that are waiting on dealor lots. "You mean I can't replace my big truck after 3 years? I better go do it now, I don't want no hybreed"

4) This is the same BS as bush's state of the union statement.


Is Bush even capable of shame?"


Harvey D.

This is pure election talk. Canadian voters recently chosed pollution control as their number one pre-occupation. So........

Canada, with only 31 million pollutes more than 100 million Europeans do. We drive the most polluting vehicles (290 gr/CO2/Km) in the world. Gas gazzlers are still number one sellers in western + mid-Canada and Canadians consume more energy 'per capita' than all other 20 industrialized nations.

Alberta, with about 10% of the country's population will create 50% of the country's GHG by 2010-12.

With Alberta tar sands activities to triple or quadruple in the next 10-12 years, to satisfy south of the border and local demands, chances are that Canada will be 50% ++ over Kyoto by 2015.

The 100+ billion $$ being invested in the Tar Sands and associated activites will weight heavily on future pollution control laws + their application.

Politicians with promise all kind of pollution controls in an effort to gain votes, but very little will be done after the election.


Baird just refused to implement any kind of Carbon tax. It's going to take a big jump in oil prices to get the rednecks out of their trucks and SUVs. Here in Vancouver there are idiots that buy trucks and then lower the suspension to the point where they are useless as trucks. Baird is a bad joke in a green tie.

Rafael Seidl

Any improvement in the CO2 emissions of Canada's LDV fleet will be completely swamped by the rapid expansion of oil sands production in Alberta province. Mr. Harper needs to take a more holistic view, well beyond the transportation sector.

George -

Actually, Bush is sending a bill to Congress asking it to increase the CAFE average for LDVs to 34 MPG by 2017, corresponding to 166 g CO2/km, roughly where Europe is today - but only because 50% of new vehicles here feature diesel engines.

The head of the House Transportation & Energy Committee is Rep. J. Dingell (D-MI). He is close to the Big Three and the UAW and has called Speaker Pelosi's recent idea of a special congressional committee on climate change "as useful as feathers on a fish". The contract with the union needs to be renegotiated this year, in a very tough business environment for the North American auto industry and Michigan in particular. I therefore expect Rep. Dingell will do his utmost to prevent any increase in CAFE. Be critical, but of all your political leaders.

Killing a measure that would force higher fuel economy would be short-sighted, because ignoring the risk of rapid changes in the price of oil is what caused Detroit to go from bumper profits to junk bond status in the first place. Sadly, it's a well documented-fact all over the world that consumers by and large tend not to put their money where their mouth is when it comes to purchasing their vehicle: given the choice, they will always choose the largest, safest, most comfortable and most powerful car they can afford, climate be damned. The emerging consensus is that market mechanisms alone are not enough to overcome such selfish indulgence.

Unfortunately, in addition to climate change, the global auto industry is also extremely exposed to the gyrations of the world's oil markets, which can easily overwhelm their product cycles. To hedge against this risk, the US auto industry in particular needs broader product line-ups that permit profitable operations regardless of what happens in the Middle East, Nigeria, Venezuela and elsewhere. In addition to leveraging their global engineering expertise and supply chains, US auto makers need to invest more heavily in rapid virtual product development, in more flexible production lines and demand the same from its domestic supply chains - all of these add cost to each vehicle that will have to come out of payroll and overheads.

That is why the UAW ought to accept cuts in headcount and health care provisions for both members and retirees, but only in return for quality control authority in the product roadmap process. Representing your members does not mean maximizing their job security, wages and benefits at the expense of the viabiity of the business they work for. At the end of the day, you've got to turn a profit.

Much the same, btw, applies to Germany and its powerful unions.

Of course, the other proven strategy to insulate yourself from wild fluctuations of prices at the pump is high excise taxes on fuel. Over the past 3 years, Gasoline and diesel prices went up and the down in Europe as well but by less than half as much in relative terms. Public reaction was far more sanguine than in the US and, the auto industry did not suffer a shock to the system. It's unfortunate that US voters are unwilling to consider gradually shifting their country's tax base a little away from wealth creation and toward asset consumption, as part of a package of measures that makes doing so socially acceptable.


Rafael states:

"they will always choose the largest, safest, most comfortable and most powerful car they can afford, climate be damned. The emerging consensus is that market mechanisms alone are not enough to overcome such selfish indulgence."

Do you not include taxes (carbon or luxury) as a market mechanism? Because, if you increase the price of the more powerful cars (purchase or operating costs) then people will buy smaller cars.


Shame on Bush for not setting targets and then missing them all? Tar sands seem to have brought economic arguments to the fore for Canada.Bush has emphasized meeting goals with technology{phev, bev, battery tech,future gen,bio fuels,nuclear,etc.}.Which has a better chance of making a difference,empty targets or research into world changing tech?The 2005 energy bill was delayed for four years by by the dems.The bill has energized the wind industry,bio fuels and to a limited extent solar.Dems and repubs alike are falling over themselves to expand on this Nixon to China ,perhaps it took an oilman to begin the end of oil.

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