Montreal, March 28, 2023— Propulsion Québec, the cluster for electric and intelligent transportation, welcomes the investments announced today by the Minister of Finance of Canada, Ms. Chrystia Freeland, to promote the energy transition and ensure the competitiveness of Canadian businesses in the face of the Inflation Reduction Act (IRA) adopted last August by the United States.
A strong signal for the green economy, but concrete initiatives are still expected
The measures announced today to support the manufacturing of clean technologies, notably the zero‑emission vehicle industry and the exploration of critical minerals, represent a step in the right direction to respond to the American strategy that provides for unprecedented investments in the transition to a green economy and in reshoring production to U.S. soil. Propulsion Québec would, however, have liked to see investments to support the acquisition of zero‑emission vehicles and infrastructure to accelerate the transition of vehicle fleets. The cluster also notes a lack of concrete measures dedicated to innovation in the transport sector and to workforce training.
“The federal government gets it right by offering a targeted response to the IRA. It is essential that Canada align with its trading partners, notably the United States and Europe, in order to ensure the competitiveness of businesses in the context of the energy transition. We hope the Canadian government commits to a coordinated green industrial policy that would deploy concrete measures for our ecosystem,” says Sarah Houde, CEO of Propulsion Québec.
Better coordinate efforts
We acknowledge that over the past few years the federal government has invested significant sums in clean technologies and the various links of the supply chain for electric and intelligent transportation. However, we are convinced that better coordination of efforts among the different partners and ministries, and continuous monitoring of progress toward clear targets, would be our greatest allies.
Electric and intelligent transport: accessible and concrete solutions to decarbonize the economy
Given the urgency to act on climate, Propulsion Québec has been proactive and has proposed a sectoral industrial policy for the electric and intelligent transport sector –TEI Ambition 2030– which identified 225 concrete initiatives led by more than 60 partners.
We thus offer our full collaboration to the Government of Canada to identify and deploy concrete measures for the electric and intelligent transport sector.
Budget highlights
Among the announcements related to transportation, it is relevant to highlight the investments over 5 years that could have a positive impact on the ecosystem:
- C$6.3 billion to introduce an investment tax credit for clean electricity,
- C$1.08 billion to support clean electricity projects,
- C$4.5 billion to introduce an investment tax credit for the manufacturing of clean technologies,
- C$5.5 billion to introduce an investment tax credit for clean hydrogen,
- C$294 million to support clean technology projects,
- C$20 million to improve reduced tax rates for manufacturers of zero‑emission technologies,
- C$52 million to strengthen Canada’s trade corridors,
- C$14 million by 2028 to expand flow‑through share deductions and the tax credit for critical minerals exploration to activities for extracting lithium from brine.
