We’re Gonna (Drive) Down To Electric Avenue

3 minute read

Last week, Prime Minister Justin Trudeau joined Québec Premier François Legault to announce a nearly $100 million investment in Lion Electric for the establishment of an electric vehicle (EV) battery assembly plant in Saint-Jérôme. The company, which manufactures all-electric trucks and buses, is expected to bring 135 new jobs to the area by 2023, with the possibility of even more long-term growth via a future research and development facility. 

This announcement is just the latest part of a broader push by our governments, industry, and the public to invest in all aspects of the EV supply chain — from early-stage mineral extraction all the way to the assembly of batteries and vehicles. But is Canada prepared to realize its potential and become a major player in the global EV boom, as some politicians and industry leaders claim? That will ultimately come down to our governments’ and business community’s ability to leverage some existing advantages and manage a set of obstacles in the road toward a greener world and more sustainable industry.  

Most conventional EVs run on lithium-ion batteries, whose technology operates using minerals such as lithium, nickel, cobalt, and graphite. When it comes to manufacturing and supplying materials for lithium-ion batteries, Canada possesses a unique competitive advantage. Our soil, mines and seas are rich in many of the minerals that are critical to the EV supply chain. Although its natural reserves of base metals are gradually dwindling, Canada is still home to some of the world’s largest lithium, nickel and cobalt deposits, among others.

According to BNEF, Canada’s raw material capacity in the battery supply chain currently ranks fourth in the world and first in North America. But perhaps more importantly, Canada is home to a robust natural resource extraction industry. This is what former Industry, Innovation and Science Minister Navdeep Bains dubbed as Canada’s “mines to mobility” advantage — the capacity to play an outsize role in the entire EV supply chain, from mineral extraction to vehicle rollout. 

Yet, Canada has even more room to claim a major stake in the global EV boom. With environmental standards becoming an ever-more important priority for governments and corporations both at home and abroad, Canada has the momentum to leverage its progressive environmental policies and strong regulatory landscape. One of the world’s largest producers of cobalt — and a major player in the global EV supply chain — is the Democratic Republic of Congo. For years, critics have sought to bring attention to the Congo’s mining industry, where multinational corporations often behave with little regard for workers and the local environment. If governments and financial institutions across North America and Europe are intent on greening their investments, then Canada certainly has a strong pitch to make them. 

Despite all of its natural advantages, Canada continues to face significant obstacles on the road toward becoming a crucial peg in the global EV supply chain. And while an entire book could be written about these obstacles, the most potent risk, from a political perspective, may be coming from inside the energy sector itself. 

Perhaps the greatest hurdle to Canada’s green energy aspirations is the oil and gas industry. As one article succinctly put it, “Canada can’t continue to try to do two things: help a dying industry and address climate change.” We can’t have it both ways. Canada cannot at once brand itself as a global trailblazer in green energy technology while continuously resuscitating a dying oil and gas sector by pouring billions of dollars in ill-fated pipelines.

Provinces like Alberta, where oil and gas still has a chokehold on politics and the economy, will have a far greater chance of revitalizing their markets by better equipping their energy sectors to help usher in the EV revolution, rather than pinning workers’ hopes on pipelines that will never be built and jobs that will only continue to disappear.At the end of the day, the federal government and a handful of provinces, like Québec and British Columbia, won’t be able to go it alone. Other provinces, like Alberta, have the industry, the money, and the skilled workers that can and should be directed toward more sustainable energy projects — including the EV supply chain. Until then, every dollar that goes into pipelines and oil sands (and driving out Bigfoot) is a dollar that doesn’t get invested in the green energy economy — and Canada’s future prosperity.

Missed this week’s Look Ahead?

We’ve got you covered.

Articles we think you’ll like

Subscribe to our mailing list.