With details on the Carney government’s tailpipe emissions standard expected this summer, analysts say a strong, swift policy is essential for market certainty and to ease costs for cash-strapped Canadians.

Prime Minister Mark Carney’s launch of a new auto strategy in February, including a renewed electric vehicle rebate program and a C$1.5-billion injection into the country’s charging network, signalled the “return of EV momentum in Canada,” write Clean Energy Canada’s Rachel Doran and Joanna Kyriazis in a recent post for  Electricity Autonomy.

Another “critical component” of the strategy was a promise to replace the repealed Electric Vehicle Availability Standard (EVAS) with a tailpipe emissions standard that could deliver 75% EV sales by 2035, and 90% by 2040. The EVAS was seen as a politically unpalatable effort launched in 2023. It mandated that 20% of all new light-duty vehicle sales be electric by 2026.

The new standard needs to come into effect “in 2027 at the latest,” write Doran and Kyriazis. “Since EVAS was repealed, Canada has had no policy on the books improving the fuel efficiency of cars and trucks after 2026—and in a fuel crisis, it’s critical there is no policy vacuum here.”

Ottawa has pledged to reduce tailpipe carbon pollution by nearly 57% from the previous standard of 172 grams of carbon dioxide equivalent (CO2e) per mile. The new target is 74 grams CO2e per mile.

Industry representatives have pushed back against the nascent standard as “too aggressive,” reported The Globe and Mail. Energy transition and climate advocates warn that 74 g/mile is already too weak.

A 74 g/mile tailpipe standard “could result in 62 megatonnes fewer cumulative emissions reductions by 2035,” compared to what could have been achieved with the original EVAS, wrote the Pembina Institute in March. The shortfall could translate into “more than $18 billion in additional social costs from greenhouse gas emissions.”

The federal government “will need a vehicle emissions limit of 40 grams of CO2 equivalent per mile by 2035 to confidently reach its target of 75% electric vehicle sales,” ” the clean energy think tank added. Even 62 g/mile would provide “only a reasonable chance” of meeting the target, as “weaker targets reduce the market signal needed to scale EV adoption.”

Consumer interest in EVs is surging thanks to the new rebate program and the recent spike in gasoline prices, write Doran and Kyriazis. February EV sales were up 47% in Canada year over year, while online searches for battery-powered vehicles grew 94% in the first three months of 2026.

“Strong standards would ensure the Canadian market is prioritized when carmakers are deciding where to send EV inventory, including more affordable EV models.” Affordability is critical, Kyriazis wrote in a recent release. “Canadians are hungry for good options that make financial sense in the short term as well as the long term.”

Strict tailpipe emission limits would also support and de-risk investments in Canada’s EV supply chain and charging network. To achieve market certainty, the standard must meet an interim goal of “at least 40% EV sales by 2030.” This goal will ensure the carmakers make steady progress with electrification, providing both “the early momentum that will allow the market to take over in later years” and “the certainty that key players, such as charging station networks, electric utilities, raw material suppliers and battery recyclers, need to continue investing in Canada’s EV supply chain.”

Clean Energy Canada recommends two further guardrails: The standard must be applied to all vehicles regardless of size—not like the existing design that has one for cars and a more lenient standard for pickup trucks and SUVs, which “contributed to a significant shift towards larger, more polluting vehicles over the last 20 years.”

Carmakers must also be restricted to a narrow set of options when it comes to compliance. In particular, the excessive use of carbon credits should be forbidden.