Ross Marowits
The Canadian Press
MONTREAL (Jan 20, 2010)
The eventual popularity of electric cars will force governments to consider alternative revenues as they prepare to wean themselves off fuel taxes, industry observers say.
Canada's three levels of government share about $15 billion in taxes from fuel annually. But some of that revenue could be at risk if consumers turn en masse to plug-in electric or hybrid vehicles.
"What is being talked about is taxes on electricity, taxes on other modes of transportation like highway tolls," said Al Cormier of Electric Mobility Canada.
But the founder of the organization that promotes electric cars says taxation shouldn't be a major issue for at least five years. It will depend on fuel prices and electric car purchases.
The industry has forecast that there will be 500,000 plug-in electric cars in Canada by 2018. That's a small fraction of the 20 million vehicles on the country's roads today.
HEC business school professor Pierre-Olivier Pineau said governments have to rethink their tax intake as society looks to rid itself of its oil consumption habit. He said the most likely option is to implement carbon taxes or increase ones already in place in B.C. and Quebec.
Part of the government's tax solution might also involve charging higher rates to recharge a car than for residential uses.
Existing networks only charge one price for each household.
But "smart grids" that could be available in a decade would permit variances.
"It's becoming a buzzword and people think it will change a lot of things," he said.
Growing interest in electric cars has Canada's provincial and municipal electric utilities conducting pilot projects to get ready.
Hydro-Quebec recently announced a partnership with Mitsubishi to test the performance of 50 plug-in i-MiEV electric cars in the town of Boucherville over the next three years.
The $4.5-million project provides the public utility with another window on the electric car market. It is also testing a Ford Escape hybrid and a hybrid pickup truck, while batteries developed by its TM4 subsidiary are being tested overseas in vehicles being developed by Indian carmaker Tata.
Spokesperson Stacey Masson said the Mitsubishi project is part of the energy giant's overall strategy and will help it evaluate the impact of electric vehicles on its vast network.
B.C. Hydro launched its own trial of the cars in November and is also awaiting delivery of the Nissan Leaf in 2011.
Toronto and Calgary are also looking to test electric cars.
The vehicles are seen as part of the solution to global warming as they emit no greenhouse gases.
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