Québec issues final regulations for ZEV mandate; in effect 11 January 2018; targeting ~10% ZEVs and LEVs by 2025
Québec Minister of Sustainable Development, the Environment, and the Fight Against Climate Change Isabelle Melançon has issued the final regulations in support of Bill 104 – An Act to increase the number of zero-emission motor vehicles in Québec in order to reduce greenhouse gas and other pollutant emissions. (Earlier post.) Québec is the first Canadian province to adopt a ZEV mandate. As of today, close to half the Canadian ZEV fleet is located in Québec, which non-coincidentally has the largest public charging network in the country.
The National Assembly unanimously adopted the Act to increase the number of ZEVs on 26 October 2016. Following the example of 10 US states, including California and several northeastern states, Québec has thus assumed the power to adopt the ZEV standard. In the wake of the adoption of the Act, two draft regulations were published in the Gazette officielle du Québec on 5 July 2017, and the Cabinet approved the attendant regulations on 13 December 2017. The ZEV standard is part of an array of initiatives, in particular those stemming from the 2013-2020 Action Plan on Climate Change and the 2015-2020 Transportation Electrification Action Plan (PAET 2015-2020), which has set a target of 100 000 plug-in vehicles registered by 2020.
The standard will come into force on 11 January 2018. The automakers subject to it must accumulate credits by obtaining zero-emission vehicles (ZEVs) or low-emission vehicles (LEVs) on the Québec market. The credit target is calculated by applying a percentage to the total number of light-duty vehicles that each automaker sells in Québec. The credit requirement thus varies from one automaker to the next.
Each sale or lease of a ZEV recognized by the Minister earns credits, the number of which varies according to the vehicle’s electric range. The greater the range, the greater the number of credits that the automaker earns, which consequently reduces the number of ZEVs that it must sell to meet its credit target. The purpose of the ZEV standard is thus to spur the automobile market to develop greater numbers of models that rely on increasingly efficient low-carbon technologies. The percentage of mandatory credits will be calculated on the basis of the total number of new vehicles sold or leased in Québec and manufacturers will start earning credits with model year 2018.
Looking to the future, the government anticipates that by 2025, ZEV and LEV sales and leases will account for approximately 10% of the market. Major automakers—those that sell or lease more than 20,000 vehicles in Québec annually—will need to earn a specified percentage of credits based exclusively on ZEV models, starting in 2020.
Manufacturers which do not achieve their target will be required to purchase credits from other automakers that have excess credits available, or pay a fee to the government. Income will be paid to the Green Fund and used to support climate change projects, particularly those aimed at greening the vehicle fleet.
While the Québec standard in large part follows current ZEV standards in 10 US states and provides the automobile industry with normative continuity on both sides of the border, one difference is that Québec regulations also permit vehicles that have been upgraded by carmakers and licensed for the first time in Québec to qualify for credits. This measure was included in the standard in order to make it possible for low-income households to also choose zero-emission vehicles.
The ZEV standard will change the business model of Québec automobile dealerships. Recognizing the importance of maintaining a dialogue process with key players in the transition to a greener vehicle fleet, the government also announced the creation of a committee the mandate of which will be to monitor the evolution of this dossier.
The committee, jointly led by the Corporation des concessionnaires automobile du Québec (CCAQ) and the Ministère du Développement durable, de l’Environnement et de la Lutte contre les changements climatiques (MDDELCC), will also rely on the expertise of the Coalition zéro émission Québec (CZÉQ) and Steven Guilbeault, Cofounder and Senior Director of Équiterre, who will represent environmental groups.