One-fifth of all passenger cars, SUVs, and light trucks sold in Canada in 2026 will need to run on electricity under new regulations published just before the holiday by Environment Minister Steven Guilbeault.

By 2030, the mandate will hit 60% of all sales, and by 2035, every passenger vehicle sold in Canada will need to be electric, The Canadian Press reports.

Guilbeault’s parliamentary secretary Julie Dabrusin said the new target is “about making sure that Canadians have access to the vehicles they want.”

Manufacturers or importers that don’t meet the sales targets could face penalties that would be phased in under the Canadian Environmental Protection Act.

Canada still has a long way to go before approaching the first target in 2026, CP says.

In the first six months of this year, sales of fully-electric and plug-in hybrid vehicles made up just 7.2% of new car registrations. For all of 2021, the proportion was 5.2%.

Cara Clairman, president and CEO of Plug’n Drive, a Toronto-area non-profit that encourages electric vehicle use, said the toughest part of promoting the change from gas-powered vehicles is availability.

“Long waiting lists are definitely discouraging consumers who are ready to make the switch,” she said. “And if we all agree that we’re in a climate emergency, we need to help consumers make the switch as soon as possible.”

Brian Kingston, president and CEO of the Canadian Vehicle Manufacturers’ Association, said the federal government should be building out necessary infrastructure for electric vehicles before regulating sales.

He suggested Canada’s infrastructure is not on track to support a growing fleet—and those who will be driving the new cars. “The vehicles are coming, but we need a supercharged effort to help marketing, and actually make that purchase and make it easy, convenient, and accessible,” he said.

Under the draft regulations, which were to be formally published December 30, the government proposes tracking the sales by issuing credits for vehicle sales.

Fully electric cars and trucks would be worth a bigger credit than plug-in hybrid versions, though the government acknowledges that hybrids will likely remain in demand in rural and northern areas.

The mandate fulfils a 2021 Liberal election promise. It’s the first major set of regulations to come out of the emissions reduction plan the government published in April.

That plan is Canada’s broad roadmap toward its 2030 goal to reduce greenhouse gas emissions across all sectors by 40 to 45% below 2005 levels.

Passenger vehicles account for half of all road transportation emissions and about 10% of Canada’s total emissions across all sectors.

Before Wednesday’s move, Canada already had targets for electric vehicle sales. But they were not enforceable, and the government wasn’t successfully compelling car companies to ramp up the number of electric vehicles available for sale.

Kingston told CP the government’s approach seems intended to “regulate away global supply chain challenges”—but he said that’s not realistic, since a whole new supply chain is being created for electric vehicles.

“You can’t regulate away shortages, and it simply doesn’t work like that,” he said.

The new policy would decouple Canada’s regulatory regime from the United States, Kingston warned, and the impending penalties for vehicles sold outside of the prescribed federal targets could raise the overall cost of operating in Canada.

But Nate Wallace, clean transportation program manager at Environmental Defence Canada, said the federal mandate “will help Canadians escape high gas prices by getting behind the wheel of an affordable electric car. Requiring automakers to meet sales targets will make them break ZEVs [zero-emission vehicles] out of the luxury market and go mainstream with more affordable, mass market models.”

Wallace added that an effective credit system would drive down ZEV costs by 20% for the average consumer.

“While automakers talk a good game about the electric transition, we know that this is the only policy strong enough to break manufacturers’ gasoline vehicle production bias and ensure we meet our sales targets,” he added. “Left to their own devices, they would have kept us in gas guzzlers or on a waiting list for a luxury electric car.”

Andréanne Brazeau, mobility policy analyst at Équiterre, added that “Canadians across the country are eager to get their hands on electric vehicles, and this long-awaited regulation will help them purchase one more quickly and at a more affordable cost. With a credit system that is stringent enough, this zero-emission vehicle standard will act as a comprehensive policy and help Canada catch up with leading jurisdictions in transport electrification.”

Clean Energy Canada Senior Policy Advisor Ekta Bibra celebrated the announcement in a release but warned that the penalties will need to be legally enforced, “a time consuming process” that will create complexity and uncertainty.

The group said other countries have opted to use immediate financial penalties as soon as automakers are non-compliant.

The new targets will be countrywide, though some provinces are already ahead of others. An analysis released last month by the Canadian Climate Institute concluded that mandates helped both Quebec and British Columbia move well out ahead of the rest of the country on electric vehicle use.

Anna Kanduth, a senior research associate at the institute, said the global supply of zero-emission vehicles is still limited, though it is growing quickly.

“Auto manufacturers are largely prioritizing jurisdictions with some type of sales mandate,” she wrote, so places with mandates have much higher rates of zero-emission vehicle adoption and more model choice.

B.C. is leading the field in EV sales, which account for almost 15% of all new vehicles registered between January and June. Quebec places second, at 11.4% of registrations.

Then there’s a steep drop-off to third-place Ontario, where only 5.5% of new registrations are for electric vehicles. The province cancelled its electric vehicle incentive after the Doug Ford government took office in 2018.

The number is below 4% in all other provinces.

“What happens is that the vehicles are going to those jurisdictions with a sales target,” Dabrusin said. “I would encourage any jurisdiction that’s looking at how to assist on the affordability piece, and to encourage the purchase of zero-emission vehicles, that they also consider and look at what’s happening across our country.”

This report by The Canadian Press was first published December 21, 2022.